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How to Sell Merchant Services to Auto Repair Shops

If you are looking to help your local auto repair clients with their credit card and payment processing, this article will give you the edge you need!

In this article I want to give you some specific insights that you can use to sell local auto repair shops in your area.  Payment processing for auto repair shops is very important and there are plenty of things you can offer to prospects in this niche to differentiate from the competition.


#1 – Start with their average ticket size and talk through their percentage fees. 

Take their total credit card processing volume and divide that by the total number of transactions so you can get their average ticket size.  This number will vary a lot.  If it is a transmission shop, you might see an average ticket size of $800+ or if they primarily do oil changes, the average ticket size might be as low as $50.00.  In either case, focus on the percentage fees that they are paying and give special attention to the mid-qualified rate.  Most auto repair shops take a lot of transactions over the phone from clients and for most processors, these keyed in sales will fall into the mid-qual bucket or “tier”.

#2 – Offer electronic check processing.

Auto repair shops, and especially larger ticket size shops hate taking checks and many of them even refuse to take checks.  This is because once they give the car back to the customer, they really have no way other than going to court to collect their money.  The way they get paid is that they ensure they have received payment before giving the car back.  If someone gives them a bad check, they will not know this for a few days and by that time, the person will already have the car back and now they have to take this person to court.

Electronic check processing with conversion and guarantee is a great service for these situations.  Let me explain how these two services work.  First of all, when it comes to check “conversion” this means that the check is converted into an electronic ACH transaction.  You would be surprised how much time a mechanic spends at his or her local bank filling out long deposit slips, signing the back of all the checks, etc.  With check conversion they never have to do this again.  Considering that the average mechanic charges $80 per hour, imagine the extra revenue they could generate, just by eliminating that daily trip to the bank.

Check guarantee is a service that actually guarantees the  amount of the check.  The auto repair owner would write certain info on the check like driver license information and then scan the check through a machine that stores a picture of it.  The terminal will dial out to a special service to see if this checking account has a history of NSF and if they do, they will decline to guarantee the check and this is a red flag to the owner.  If they do guarantee it, the owner will get his money and if the check comes back NSF, the check processing company goes after the customer rather than the repair shop.  This will save them time and money in the long run and it will keep them from having embarrassing conversations with customers about bad checks.  There is usually a per transaction fee of around $0.25 for this service plus a percentage fee of 0.50% to 1.5% depending on the service offered and the high ticket size for the guarantee.

#3 – Get them some information on how chargebacks work.

One thing many auto repair shops don’t know is that in most cases they need to keep their signed receipts and work orders for up to 18 months and they need customers to sign something when they pick up the car if they paid over the phone.  Lets say a customer spends $1,200 on a big repair job and uses their visa card.  6 months later they are in a financial crunch, so they call Visa and say, “The mechanic charged me $1,200 but he didn’t really do anything and my transmission doesn’t work.”  Visa will file a chargeback and it is up to the auto-repair shop to produce a signed receipt and details on the work completed, otherwise they could lose that $1,200 in revenue.  This has become so common in the US that it has been called, “Legalized Stealing” because some people do this all the time and they know that a good percentage of the time, the small business owner didn’t keep proper records and will lose the chargeback.

Now its time to go visit an auto repair shop so you can provide these insights to them and make some money!

James Shepherd

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