How We Do It: Accepting Credit Cards at Greenworld Irrigation Specialists

There are several advantages to accepting credit cards. However, there was a learning curve involved when we first implemented the system here at Greenworld Irrigation Specialists, West Nyack, N.Y.

To begin accepting credit cards, we first had to contact a credit card service company to acquire the data service and equipment. The machines usually sell for $200 to $300 outright or rent for $5 to $20 per month. However, our co-founder already owned a machine, so our cost was nothing. Also, because it was possible to purchase the equipment from one company and the data service from another, we shopped around until we found a second service company with better transaction rates and service charges to keep fees down.

All of this setup was easily done over the phone and installing our hardware was also straightforward. The type of machine we use has us punch in the client’s credit card number rather than swipe the card. This works well for us because not many of our clients come into the office to pay their bills. They enter their credit card information on their service contract or bill.

When we began offering payment by credit card, only about 5 percent of our client base chose that option. More of our customers are taking advantage of this form of payment and some clients have even mentioned that they purchased an irrigation system just because they could charge it. However, we do incur a small 2.47-percent charge for each transaction.

For instance, if we installed an irrigation system that cost our client $1,000, after running the card, our business account would only be credited $975. The other $25 would be paid to the credit card service company. To combat this charge, we try to mark up our work by 3 percent, which our customers hardly notice.

While working with credit card machines and services is easy, we did learn the hard way that finding an organized, trustworthy person to handle credit card payments is a must. Originally, we hired an office person who claimed to be familiar with credit card systems, but who made several mistakes like charging a client’s card twice. Though that kind of mistake is easy to correct and the client usually understands, there is a charge to our company to credit the amount back to the client’s card. For us, the charge was $25 per occurrence, which can add up quickly.

To stop overcharging clients and avoid penalty fees, we hired a new office manager who has a background in accounting to handle credit card transactions. Her accounting knowledge also comes in handy because we store credit card information in QuickBooks. This system made accessing the information easy, but we also made sure to install several levels of security on our computers to safeguard our clients’ personal information. Three different passwords are required to access our network, QuickBooks and sensitive account information. Also, to keep our clients’ information secure, we have a computer technician regularly update our computers with antivirus protection. Additionally, we do not allow our employees to take credit card information on-site. We don’t want to give our employees an opportunity to be anything but honest, so clients must come in or call the office with their credit card information or put it on their bill.

With credit cards, clients benefit from having 28 days to pay their bills and they have the convenience of being able to finance expenses like irrigation systems. And, once they provide us with their credit card information, they never have to submit it again. It’s all on record.

For our company, there are also many benefits. The primary advantage is that our account is credited within 24 hours of charging the card, rather than having to wait for a check from the client, depositing it, clearing it and then reconciling the checking account at the month’s end. Because payments are made when the job is complete, our cash flow is better. We proudly display all accepted credit cards on our invoices and we expect to increase our charging client base to 75 percent within the next two seasons. Also, we know our professional image and competitive advantage strengthen with each swipe. – Brian Klimek

The author is president, Greenworld Irrigation Specialists, West Nyack, N.Y., and can be reached at 847/721-5055.