This will come as no surprise to restaurateurs: When a customer swipes their debit or credit card on their POS machine, the restaurant pays a percentage — say, 2% — to the bank for using its machine. It’s also no secret that percentage adds up.
Of course, it can be significantly higher than that.
To make matters worse, many establishments aren’t even aware of how much they pay in processing fees — or how much it impacts their bottom line. Others are told they’re paying one thing; in reality, they’re paying more. Unbeknownst to them, clauses in their contract allow rate hikes at will.
SO, It quite literally pays to stay informed. With that in mind, let’s take a closer look.
How processing fees work
Processing fees are the entire fee the restaurant pays. They refer to any fees associated with processing payment for the sale of goods. Whether you swipe, tap, insert, pay with Apple/Google Pay, or manually enter a card, it goes through a payments processor.
Know what you’re paying in processing fees
Want to know how much you are paying right now? Check the settings on your current Point of Sale system, specifically the reports that you get from payouts. Read the fine print on the contract you signed. Alternatively, ask a rep from that company.
Sometimes, you have to do the math manually to back into and understand what you’re actually paying.
With variable rates, it’s much harder to break it down since every transaction can have a different rate associated with it. Often, POS companies add in a contract clause allowing them to adjust the fees for any reason, at any time. It’s something to be aware of and look for before signing to make sure you aren’t taken advantage of after you sign a deal. Table Needs is not only contract-free, we only offer set rates, which won’t get changed on you. You’ll enjoy complete visibility into the payouts and fees right in your reports dashboard.
Flat rate versus variable rate
Like many of our competitors, we offer flat-rate processing. That means that we charge a flat fee for all payments. It doesn’t matter if you use an American Express card or a debit card, you pay the same percentage. The benefit to this approach is the fees are straightforward, easy to calculate, and consistent. With a flat rate, you don’t have to worry about unpredictability, or the random fees associated with variable rates.
Variable rates are just that. They change with every different card that is swiped, keyed, or entered. Some might be 1%. Another could be 4%. As a business owner, you hope you win on average.
It’s complicated and frankly hard for any business owner to understand or follow. As a result, many remain in the dark.
Table Needs doesn’t work that way. Our fees are as follows:
- 2.69 + 10¢ (when the customer’s card is present at the time of transaction)
- 2.9 + 30¢ (when the customer’s card is not present at the time of transaction for example, online ordering or call ahead orders)
Who is Table Needs and why should you care?
Table Needs is a Point of Sale (POS) software company and we partner with Stripe, an independent sales organization (ISO) that is a payment processor.
Typically, anyone who signs a contract may be subject to a monthly minimum and many ISOs enlist this. However, Table Needs does not have a monthly minimum, nor do we enlist contracts.
As for where our fees come from and what determines them, Stripe sets our limit. As a result, that’s the lowest we can go without losing money on every transaction. It’s important to us that we’re fully transparent. So, what you see — and what we tell you — is exactly what you can expect.
End-of-Day batching and Table Needs
Simply put, batching is when all the payment transactions that have been collected in a day are run through the aforementioned payment processing process.
As it goes through the process — which can take a variable amount of time — payments get processed and then are deposited into a restaurant’s bank account. This is time-consuming and it’s something that traditionally is done manually by a restaurant.
We do this automatically for our restaurant partners.
Whether you’re on the fence about your POS or ready to make a move, we can walk you through the options and design a solution that’s as simple or as wide-reaching as you need. Our plug-and-play solutions are tailored to the goals and circumstances of individual restaurateurs, designed with the local, independent operator in mind. Ready to accomplish more, while knowing exactly what you’ll get? The restaurant technology tools from Table Needs can help.
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