Business Eye LLC

After working with more than 1,000 merchants, I learned that one simple question could change the entire conversation about payment processing.

By Joe Wilkins | Merchant Doctor™ | Business Eye Network

What grade would you give your credit card processing company?

An A? A B? Maybe a C, D, or even an F?

Now let me ask you something else.

What would you base that grade on?

Your processing rates? Your monthly fees? Your equipment? The quality of service you receive?

Or would you consider everything your payment provider does—or doesn’t do—for your business?

Over the course of my career, I’ve worked with more than 1,000 merchants. And years ago, I developed a simple technique that became one of the most memorable parts of my sales presentations.

I would review a merchant’s processing statement, evaluate their business, and give their existing payment provider a letter grade.

Sometimes it was an A.

Sometimes it was a D.

And occasionally, the situation was so bad that an F didn’t seem low enough.

It sounds simple. Almost too simple.

But I believe that letter grade helped me win business because it accomplished something that complicated processing statements rarely do.

It made the merchant stop, think, and ask why.

And that was exactly where I wanted the conversation to begin.

Where It Started: North American Business Solutions

Earlier in my career, I served as Vice President of Operations at North American Business Solutions (NABS), a merchant services company with approximately 13 inside sales representatives and nearly 20 outside sales representatives.

We had a structured approach to selling payment processing services.

Our outside representatives would meet with business owners in person, while someone from our inside team would participate in the presentation by phone.

I frequently handled those presentations myself.

But I wasn’t interested in simply giving a sales pitch.

I wanted to understand why merchants made decisions, how our representatives moved opportunities through the sales process, and what separated successful presentations from unsuccessful ones.

We used Salesforce to track that information.

Our sales process generally involved three appointments.

Appointment One: Discovery.

We introduced ourselves, learned about the business, discussed its payment requirements, identified the decision makers, and requested a processing statement.

Appointment Two: Analysis and Proposal.

We returned with a detailed analysis of the merchant’s current processing arrangement and a proposal explaining what we could improve.

Appointment Three: Decision.

We addressed any remaining questions and worked toward a final decision.

Sometimes an opportunity required a fourth appointment. Occasionally a fifth.

But our objective was always to keep the process organized, productive, and moving forward.

We also tried to ensure that everyone involved in the decision was present when we reviewed the proposal.

That mattered because a business owner might understand the financial savings, while a partner, controller, or operations manager had entirely different concerns.

We wanted those concerns addressed together.

What the Salesforce Data Taught Me

One of the advantages of having a structured sales process was that we could measure it.

We tracked appointment progression, individual performance, and closing percentages.

We could see who handled the initial conversation, who presented the proposal, and which opportunities ultimately became customers.

I paid particular attention to that information.

When I compared my own results with those of other people handling presentations, my closing percentage was approximately four percentage points higher.

Now, I can’t tell you that one particular technique accounted for that difference.

There are too many variables in sales to make that claim.

But I did notice something about my approach.

I was extremely consistent.

I opened conversations the same way. I established expectations. I learned about the business. I explained our philosophy. And when we returned with our findings, I made the information easy to understand.

One of the most effective ways I found to do that was by giving the merchant’s existing processor a letter grade.

The Top-Down, Bottom-Up Approach

Before we ever reviewed a processing statement, I introduced a philosophy I called our Top-Down, Bottom-Up Approach.

It was a simple way to explain how we evaluated a business.

From the top down, we wanted to understand the merchant’s operation.

What kind of business was it?

How did it accept payments?

What equipment did it use?

What technology did it need?

Were there opportunities to improve reporting, customer management, or operational efficiency?

Then, from the bottom up, we examined the underlying costs of providing those services.

We wanted to determine the lowest practical cost at which we could deliver the appropriate technology and level of service.

Our goal was straightforward:

Provide the same or better service at a lower overall cost, with as little disruption to the merchant as reasonably possible.

That was our philosophy.

And it gave the merchant something tangible to understand before we ever started talking about rates.

We weren’t simply looking for an opportunity to beat a price.

We were looking for an opportunity to improve the overall value of the relationship.

Then Came the Letter Grade

By the time we reached the second appointment, we had already learned about the merchant’s business.

We had their processing statement.

We understood how they accepted payments.

And our quoting department had reviewed the numbers and prepared our proposal.

Instead of immediately presenting a complicated spreadsheet, I would often start with something like this:

“After reviewing your processing statement, considering your industry, your transaction volume, how you accept payments, and the services you’re receiving, I’d give your current processing company a D.”

And then I’d stop.

The merchant would almost always want to know why.

Think about that for a moment.

A business owner might not immediately understand interchange, basis points, assessment fees, or effective processing rates.

But everyone understands what a D means.

And everyone understands the difference between an A and an F.

The letter grade gave them an immediate reference point.

It simplified the conversation without eliminating the financial analysis behind it.

The grade got their attention. The explanation earned their trust.

How Did I Determine the Grade?

I wasn’t assigning grades randomly.

My assessment was based on several factors, including the information gathered during our first appointment and the processing statement we reviewed.

There wasn’t a formal mathematical scoring system behind the grades at the time. It was a professional assessment informed by the business’s circumstances and the financial analysis.

Here’s what I considered.

1. Processing Costs

I looked at the merchant’s total processing expenses, not just the advertised rate.

What percentage of their processing volume were they actually paying in fees?

Were there unnecessary charges?

Were their transaction fees reasonable?

How did their costs compare with what we could realistically provide?

A merchant processing $30,000 per month shouldn’t automatically be evaluated the same way as one processing $300,000 per month.

And two merchants processing identical volumes might have very different transaction characteristics.

Those differences mattered.

2. Industry and Risk

Different businesses have different payment requirements and risk characteristics.

A restaurant processing mostly card-present transactions has a different payment environment from a professional services company accepting large invoices remotely.

Average ticket size, transaction volume, card mix, payment methods, and business risk can all influence processing costs.

I wanted to understand those variables before deciding whether the merchant was receiving competitive pricing.

3. Equipment and Technology

Was the merchant using equipment appropriate for the business?

Did they have the capabilities they needed?

Could a different terminal, virtual payment solution, or point-of-sale system improve their operation?

Sometimes the merchant’s processing rates were perfectly reasonable, but their technology was holding them back.

That was an opportunity worth discussing.

4. Service and Support

Was the merchant happy with the service they received?

Could they get help when something went wrong?

Were equipment issues resolved promptly?

Were they receiving meaningful support, or were they simply another merchant account number?

The quality of service was part of the value equation.

5. Overall Business Value

Finally, I considered the relationship as a whole.

Could we provide better service at a lower cost?

Could we improve their technology without increasing their expenses?

Could we introduce capabilities that made their business more efficient?

Or was their existing provider already doing an excellent job?

That final question was particularly important.

Because sometimes the answer was that the merchant already had a good arrangement.

Not Every Processor Received a Bad Grade

I think this is one of the most important parts of the story.

I didn’t automatically give every merchant’s existing processor a D or an F.

Sometimes I’d give them a B.

Sometimes an A.

I might say:

“Your processing rates are actually very competitive. I’d give your current provider an A on pricing. But when I look at the equipment you’re using and the additional capabilities available, I’d give the overall relationship a B.”

Then I could explain what we might improve.

Perhaps we could introduce better reporting.

Perhaps we could help them identify regular customers, customers who were becoming less active, or customers who hadn’t returned.

Maybe we could improve the equipment or make the payment process more convenient.

And sometimes, we simply couldn’t offer a meaningful improvement.

I was comfortable acknowledging that.

Because the purpose of the grade wasn’t to convince every merchant that their current provider was terrible.

It was to explain where they stood and whether there was a legitimate reason to consider something different.

Here’s Why I Think This Matters Even More Today

The payment processing industry has changed considerably since those days.

Today, many merchants are paying for far more than payment processing.

Consider a restaurant operating a modern point-of-sale system.

It may have a base software subscription, additional POS licenses, handheld ordering devices, kitchen display systems, payroll, timekeeping, online ordering, loyalty programs, and various other recurring services.

Some of those charges may appear on a processing statement.

Others may be billed separately.

A restaurant could have excellent processing rates while spending $1,000 or more per month on software and related technology.

Another business might have relatively high processing expenses but an efficient technology environment that eliminates substantial administrative work.

So here’s the question I’ve been asking myself:

Why are we still evaluating merchants primarily through their credit card processing statements when those statements may represent only part of their total payment-related expenses?

I believe there’s a better way.

Introducing the Next Evolution: The Merchant Doctor™ Report Card

I’ve recently been revisiting the grading concept I used at NABS and thinking about how it could evolve into something more comprehensive.

Imagine a business owner receiving a professional diagnostic report evaluating their entire payment environment.

Not just processing rates.

The report could examine:

• Processing costs: The true cost of accepting credit and debit cards, including interchange, assessments, processor markup, and other fees.
• Software and subscriptions: POS licenses, payroll, online ordering, loyalty programs, reporting, and other recurring services.
• Hardware and technology: Terminals, printers, kitchen displays, equipment costs, and operational capabilities.
• Efficiency: Whether the technology reduces administrative work or creates unnecessary complexity.
• Service and support: The quality, accessibility, and reliability of the assistance the merchant receives.
• Contract terms and transparency: Pricing structures, contractual obligations, and potential financial risks.

Each area could receive an individual assessment.

And together, those findings could produce an overall grade.

An A, B, C, D, or F.

But this time, instead of relying solely on professional judgment, the report could incorporate a documented scoring methodology, supported by financial data and measurable business requirements.

It could show the merchant what they’re spending today, what alternatives exist, and what improvements might realistically be achieved.

And it could distinguish between the performance of the processor and the broader technology environment.

Because a processor shouldn’t receive a bad grade simply because a merchant is paying too much for an unrelated software subscription.

That’s an important part of making the assessment fair.

The Best Diagnosis Doesn’t Always Lead to a New Processor

One thing I want to preserve from my original approach is the willingness to tell a merchant when they’re already in good shape.

If your processing costs are competitive, your equipment works well, your software meets your needs, and you’re receiving excellent service, there may be no compelling reason to change providers.

You might deserve an A.

And that’s a perfectly acceptable outcome.

Maybe we identify a software subscription that can be eliminated.

Maybe we discover an opportunity to introduce ACH payments or improve reconciliation.

Maybe a piece of equipment needs to be replaced.

Or maybe the entire payment environment could benefit from modernization.

The recommendation should follow the findings.

Not the other way around.

That’s the philosophy behind Merchant Doctor™.

So, What Grade Would You Give Your Processor?

After working with more than 1,000 merchants, one thing has become clear to me.

Business owners don’t necessarily need another salesperson promising lower rates.

They need someone who understands their business, can explain what they’re paying for, and can identify opportunities to improve their overall operation.

Years ago, I found that a simple letter grade could help start that conversation.

Today, I believe that same concept can become the foundation for a more comprehensive way to evaluate payment processing and business technology.

So let me ask you one more time: What grade would you give your credit card processing company?

And would that grade change if you considered everything you’re spending on payment-related software, equipment, technology, and support?

It’s a question worth asking.

Because the lowest processing rate doesn’t always mean the lowest total cost.

And the lowest total cost doesn’t always mean the best solution.

Top-down. Bottom-up. Understand the business. Evaluate the costs. Recommend what’s best for the merchant.

That’s how I’ve approached merchant services for years.

And it’s the philosophy I’m continuing to develop through Merchant Doctor™ and Business Eye Network.

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Joe Wilkins is the owner of Business Eye LLC and founder of Merchant Doctor™, providing payment processing, point-of-sale technology, and merchant services consulting through Business Eye Network.

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