Whether you’re selling strictly online or have an online store as part of the website for your brick-and-mortar business, you are most likely using what is referred to as a “high risk” merchant processor. If you have decided it’s time to say farewell to your current provider because you are looking for better terms and features, you’ll want to be certain you don’t go from the frying pan into the fire. Here are five rules to consider that will help you choose a merchant processor that will provide the features you need for your cigar and tobacco business at the best rates available.

Rule #1: Choose a processor that offers custom solutions

While there are many processors you can select, some specialize in the cigar and tobacco industry and understand your unique needs. The processor you choose should be flexible and able to accommodate your online sales process. For example, you may offer your customers subscription box services such as “Cigar of the Month” Clubs or have customers reorder the same merchandise every month.  On-going charges require recurring billing methods. Find out if your company offers the ability to process recurring payments. Because some processors consider recurring charges high-risk due to a potential for higher chargebacks, not all want to accept these charges. Also, when it comes to fees, they may vary from company to company, and your business may be able to avoid some of them depending on which processor you choose. With research, you should find the business solutions you want without paying all of the fees charged by some processors, such as:

  • Set-up Fee
  • Monthly Minimum Fee
  • Cancellation Fee
  • Chargeback Fee
  • Gateway Fee

Whatever fees you agree to, make sure you understand them, if and when they can increase, and how hard it is to get out of your new contract.

Rule #2: Ensure you always receive excellent customer service

As a retail merchant, you know there is no substitute for customer service that exceeds expectations. You strive for it in your own business and don’t have to accept anything less from your merchant processor. A company that offers superior customer service will guide you through the onboarding process, so you’ll get approved and set up fast. If you have a concern, can you speak to a real person on the phone, send an email, or live chat? If you can’t connect with the company within a reasonable amount of time, is this a company that you can trust and is dependable?

Rule #3:  Make sure you have room to grow

If you are a long-established cigar and tobacco retailer and your business is booming, you may want to maintain your clientele. But for those businesses that want to expand and grow, as your needs and requirements change, it’s good business to find out how well your merchant processor can accommodate your needs. Being locked into a long-term contract that does not allow for changes and modifications is a recipe for conflict and can perhaps hinder growth. Look for a merchant processor that is flexible so you can grow at your pace. For example, your payment gateway should allow your revenue to increase steadily. Ensure your processor understands your long and short-term goals and can provide the services you need now and in the future.

Rule #4: Choose a processor that offers added features

Some credit card processors concentrate on the basics—giving you the ability to streamline your payments by accepting various payment options. Others offer additional benefits that can make a difference in your business’s security and are fully integrated with all your point of sale systems. Ask your processing company if they offer these features:

  • Mobile payment processing
  • PCI compliance services to protect you from cyber attacks
  • Fraud protection
  • 24/7 support

Rule #5: Cancel your current merchant account yourself

When you’ve made the decision to switch and are ready to terminate your relationship with your current processor, there are specific steps you can take to avoid headaches later. Unfortunately, not all processing companies are as eager to have you depart as you are to leave them. We suggest sending an email, fax, or snail mail with your merchant account information included, along with your clear desire to terminate. If you’re using email, ask the recipient reply to confirm they have received your cancellation request and that your merchant account has been canceled or when it is scheduled to be canceled. If you fax your cancellation request, make sure to save a fax confirmation page in your records. If you use snail mail, it’s helpful to send as certified mail so that you receive an official receipt showing proof the item was mailed. This may sound overly cautious, but if your previous processor claims they never heard from you, and you have no way to confirm they did, you may continue to be billed monthly fees even when you are using another company. Without proof of termination, these fees could continue while your situation is being litigated, and it is possible you may have to pay. Play it safe, handle the details yourself and leave nothing to chance.

Switching merchant processors can be made easier if you choose to rely on tobacco industry institutions, such as The Premium Cigar Association(PCA), the leading authority, and advocate for the premium cigar and pipe retailer industry. As an option to help its members, the PCA has partnered with Premium Tobacco Payment Processing(PTP), a specialist in cigar and tobacco retailers’ payment processing needs. Because PTP is powered by Nuvo Merchant Services, a leading payment processor with a 35-year history of helping merchants in various industries, PTP can absorb a higher degree of risk. PTP’s goal is to offer PCA members the lowest processing rates for the industry, with rates and fees guaranteed never to increase. And, they never require a contract or charge a cancellation fee. If you are ready to change processors or would like a free audit of your existing processor, call Premium Tobacco Payment Processing at (321) 972-9838.