What Happens When Your Credit Card Merchant Provider Calls
Derek Cladek on July 10th, 2009
So it was a crazy day in the ecommerce world this past week! I started a new online store with a friend of mine back in February 2009 and we had a new product launching this past week. I saw this coming and we prepared the product page, got it to rank number 1 on google and had a list of just over 400 people interested in buying with a 10% off coupon. Things were set and all we had to do was wait for the product to be officially out. When the date came, the product was available we started taking orders around 4pm PST. By the end of the day we had done 70 sales! For any ecommerce store that is pretty good but since we had only done about $4,000 in sales the past few months it was a shock to our Merchant Provider for the store.
We processed the sales and now were waiting for the money to be dumped into our bank account so that we could buy the products and have it shipped to our customers. Sounds easy, doesn’t it? Well then crap hit the fan! Friday comes around the day our money is supposed to be dumped into our bank account and our merchant processing bank calls… These calls never go well because they only call when there are problems. They never call to just say, “Hey, thanks for your business, you really make us a load of money!”
“We noticed there was a very large volume and unusual transactions for your account”, well no duh! Is that wrong that we made 70 sales in 1 freakin day? Now they are planning on holding our $8,500 until we can provide tracking numbers on 10 of the sales we took.. Hmm.. do you see a problem? I do! How can we send them 10 tracking number if we don’t have the money to place the orders to get the tracking numbers? Well its not that we didn’t have the money, this was a new store for us and so we didn’t have the cash flow built up to sustain a large volume like that. I am just trying to show some problems that may come up for new store owners.
This brings me to ask a question. Would you be able to survive if you were new at ecommerce and your credit card processor decides to hold a substantial amount of your money until you can provide documentation that they require? Most newbies would not be able to make it. This has been a problem for me twice. The first time I had to eat into my own credit cards just to keep the business alive. You cannot run a business if you do not have the cash flow.
This is the point I want to hit:
Do you have a great relationship with your merchant account manager?
Do you have a great relationship with your credit card processing bank? -Most likely not, even if you are a seasoned veteran at ecommerce.
The point is, you must find a good merchant for any store you start. I am very grateful for our contact Bob Bryant. We got that phone call around 10 a.m and I emailed Bob to call me ASAP. Within 3 minutes he was calling me, how cool is that? I told him the problem, what the bank wanted and my issue with it. He said he would talk to the president of the credit card processor and would get them to release the funds. By noon I received another call from Bob who said they released the funds and would still want to see 10 tracking numbers from 10 of those orders. Now that is what I can live with. We get the money and can process these orders without going into our own credit cards, they get their 10 tracking numbers and our customers get their products and the world goes round and round.
Here is a quick screen shot of the store’s volume for the day just so you don’t think I’m full of crap.
July 13th, 2009 at 8:57 pm
[...] Mondays are our days we get the ‘tedious’ jobs done. From my earlier post about our credit card processor calling you can see how many orders we have to deal with and that was just for 1 of our Yahoo Stores. [...]