As you approach the end of each quarter, you are always looking a little closer into the profitability of your financial institutions merchant services program. What is the conclusion you are coming to? Are your program objectives being met? Have you met your expectations?
As you look over your results, it might be helpful to evaluate your current merchant account service provider and the value they provide in helping you meet these goals. Consider whether or not the services, products and support they deliver are helping you keep up with this rapidly changing industry.
If you find profitability is not where you want or expect it to be, it’s good time to ask the following questions that play a key role in your profitability:
1. Are your new merchant accounts growing as planned?
This question really asks if you are targeting your commercial account base effectively. To do so it’s crucial to have the correct mix of products and services for your merchants. How do your ancillary products and services match up to those of your competitors? Finally, do you have pricing that is competitive enough to attract larger merchants as well as the typical “mom and pop” establishments?
2. How much time is being spent on acquiring new customers compared to supporting your existing customers?
Today’s employees are given a diverse set of responsibilities and are expected to wear many hats. That’s why it’s important that your team is able to spend time on revenue-generating activities. We all know service is important, but the growth of your institution is extremely important as well. Does your payment processor offer “self service” tools for merchants to help deal with the easy questions? A few examples of this are online access to statements, data, etc. Another area to look at is the usability of your systems and the training time required for new team members.
3. How much money does your program make?
It’s essential to be able to evaluate your program’s profitability and truly understand your success. Is your payment processing company providing you with reports that are easy to understand and help you dig into the bottom line numbers? You should be able to quickly tell which of your merchants are most profitable and least profitable. Also, the fees are a key element of profit. Are you able to tell how much your provider is really charging you?
4. Are you getting the service you need?
Your financial institution is highly focused on providing top-notch customer service. Your payment processing company should be able to deliver the same. Are they working with you on ways to grow your portfolio and increase your fee income? Do they address service issues expediently, as well as those of your customers? And when it comes to your main point of contact, do you still have a primary relationship manager?
While evaluating your financial institution’s merchant services program, answer these questions truthfully. Also keep in mind what the definition of a partnership is, “a cooperative relationship between people or groups who agree to share responsibility for achieving some specific goal.”
After all, it’s those shared goals and a strong commitment from each party that will put you on your way to increased profitability and retention. Does your current merchant account service provider share your goals?
For more payment processing updates subscribe to our payment processing blog for financial institutions.
No comments:
Post a Comment