Percentages can Grow Overnight... not just Beanstalks

"But I'm in a contract..." is a phrase that never gets un-funny to me. The number of times I have consulted people and groups that said they were fine as they were "in a contract" is difficult to be counted. The number of those groups that were paying too much is easy. It's over 99%. Seriously, with the cell phone companies out there now, does anyone really think a contract protects them?

Sadly, many do and the industry is glad of it. In truth, the rate goes up constantly, but here is the good news: You can have your account reviewed once a year. That's right. Once per fiscal year, you may request that your account and its rate be reviewed even if you're in a contract (By the way, everyone is in a contract that has a merchant account).

Here's the bad news: So what? All they have to do is say that the Fed Rate and MC-Visa went up and that you just hit a brick wall. This is why you need an advocate on your side. A group that cares more about your account, than they do the processors. This is because of two things. 1)They should be the ones automatically asking for a rate review, and 2)They can say to the processor, "They have been quoted a better rate and are going to leave unless you drop the rate back down."

It's really that simple.

I have seen rates in a single year go from the 1.7%'s which is good for a Retail account to 1.83 % and even 2.3%. One customer in a two year period went as high as 3.1%. Now for those of you who do not know this, the riskier the business, the higher the percentage. 3.1% is getting into the realm of adult media. The only reason I would pay anyone 3.1% is to keep my mother out of the hospital.

There was a book out called A Father's Wisdom . It was full of many pithy one-liners that held great value, but one of my favorites was this: 'Have two keys made to your house and give them to your two best friends. If this makes you uneasy, get new friends.' The same applies here. Your account representative is your advocate, not the processors. If they are not able to argue your account down to a reasonable rate at the end of the year, and every year, then get a new one.