I'm looking at a statement right now from one of my merchants.  A local MLS, we’ll call “Weasel” with “Fuzzy Math Payment Systems”, came by to show him how he’s overpaying for merchant services.  He was a real super credible guy!  Of course nothing says credible like a business card printed on an inkjet printer with the little torn apart perforated edges.  But hey when someone comes in to your store, tells you that he can cut one of your bills by ? I guess a merchant would be a fool not to listen.   But here are the facts…you decide.
    Our merchant is at 1.75% and .25 cents with a $10 statement. They process about $1200.00 per month.  Their total bill with downgrades was $53.40 on this statement. So Mr. Weasel comes in and quotes them 1.65 and .19 with a $5 statement. I have his handwriting on the statement. I also have all sorts of complex math scribbles / equations on a sheet of paper that then arrive at a savings of 50%.  Next to his Einstein like math Mr. Weasel has written savings: $22.08 per month $264 per year.
    Boy he’s good because that's almost 50% savings on the months processing. But wait my math says there’s a savings of $5 on the statement. They had 32 transactions at a savings of .06 cents per transaction, which is $1.92 and a whopping 10 basis pts on the $1200 which is $1.20.   So we have $5 + $1.20 + $1.92 = $8.12 cents per month or $94.77 per year.  So in two and a half years this merchant would break even after paying the early termination fee of $250.00, that’s assuming mids, nons, batch fees, annual, help desk and all the other mystery fees are not higher than mine.  My program is probably better because all we have are mid and non qualified downgrades.  Now either my calculator is broken or this is not a smart business move for this merchant?
    Before talking to me and doing the math, this poor merchant thought Mr. Weasel could cut his processing costs in half.   Another example was of a merchant that actually left us.  He called to terminate his account and was already reprogrammed with another processor.  This means that we will enforce the $250.00 early termination fee.  Just for the record I don’t like to charge early termination fees and will almost always waive them, especially if the merchant has a good reason for leaving or if they give us a chance to meet the new deal.  Now this other merchant also said that we were too expensive according to the representative we’ll call Mrs. Weasel.  She’s Mr. Weasel’s wife.  They obviously went to the same school of Fuzzy Math.  But this merchant was convinced that he’d be cutting his processing bill in ?.   Now here are the numbers.  He was processing $3400.00 per month in a swiped retail environment.  His check card rate was 1.45%, qualified was 1.70% with a .27 cent transaction fee and a $6.00 statement.  His mid’s and non’s are average at 1% and 1.5% but not really an issue.  Oh, and his average ticket was high so there were only 25 transactions in the month I’m speaking of.  Total billing on the account was about $75 and the guy just wouldn’t see that “even at cost” he wasn’t going to save $37.50 a month?  One thing I could be sure of though is that it would be close to a year before he recoups his early termination fee!
    This stuff just makes me sick!   I’m all about sales and competition, I believe the best man or woman with the best product for the merchant should win!  If that’s not me, that’s fine.  I’ll also be the first to admit that sales is an art, not a science.  So I always give sales people a lot of wiggle room as long as they are honest.  But MATH is a science.   2+2 will always equal 4 and half of $100 will always be $50.     
    I know the numbers and revenue streams in our business can be easily razzell dazzeled to look better.  I’ll even concede that sometimes there are gray areas where absolute comparisons cannot be made and estimates must be substituted.   But to make claims where the number can’t even come close is simple robbery.  No more, no less.
    Now I don’t know whether Mr. & Mrs. Weasel are honestly confused because their professor at the fuzzy math school taught them that way or they know what they’re doing?  I don’t know what percentage of merchants would be susceptible to this type of tactic?  But it’s obviously enough to get the Weasel’s some short- term sales.   Maybe that’s why Mr. Weasel’s business card was homemade.  It must get expensive changing your phone number every 60 days or so.
    I know you want to keep your promises and your customers!  So don’t be a fuzzy math sales weasel!