The incredible growth of the tattoo removal industry mirrors the growth of the tattoo market. As more people get inked up, more folks decide to remove tattoos for a variety of reasons, from poor artwork to a change in lifestyle. So, it’s no surprise the tattoo removal market has been growing at more than 15% per year. By 2023, the global market is expected to exceed $4.7 billion. By offering tattoo removal at your medical spa or dermatology clinic, you can profit from this booming market! Not only have you made a good financial choice, but you can also help people remove unwanted tattoos and move on with their life. You’re doing a good thing. However, to continue serving clients, you must take care of your finances. That means making sure you don’t lose money unnecessarily. One way to keep more of your revenue is to stop credit card processing fees. Now, you may think: That’s impossible. You just pay the 3% or so and deal with it.Think again! There is a solution. In this article, we’ll show you how much you lose to credit card processing fees and how you can eliminate those fees and take home 100% of your revenue.
As an article in Mayo Clinic notes, tattoo removal is a delicate task suited for professional dermatologists and skin surgeons. Chances are you’ve put in a lot of work to get to this point. So, remember the investment you’ve made to become a dermatologist and business owner. According to market research, it can cost $500,000 or more to start a dermatology practice and offer tattoo removal. On top of that, you’ve spent time and money on education, training, certifications, regulatory compliance, and more. You also have ongoing expenses, such as labor, insurance, and equipment. It isn’t cheap to offer tattoo removal. You may even still have student debt to consider (average medical student debt nears $200,000, according to NerdWallet). You get the point: You don’t need to lose money to credit card processing fees. You’ve worked too hard and sacrificed too much. Here’s an overview of how much you pay in credit card processing fees for your tattoo removal treatment:
After payment processor markups, you’ll probably pay more than 3% per transaction, regardless of the card network.
You still may think: It’s just 3-4%. That doesn’t matter. Well, you could ignore it and continue accepting credit card payments as you do now. But you would be missing an opportunity to boost your tattoo removal profits by double digits. Yes, you can boost tattoo removal profits by double digits by removing credit card processing fees.Now, do we have your attention? Let us explain more.
Let’s do a little exercise. The average cost of a tattoo removal treatment is around $460, according to a Glamour report. Since it’s a cosmetic procedure, it’s most likely not covered by insurance. Most of your patients will pay out of pocket. Tattoo removal is a high-value transaction too. As Federal Reserve research has found, consumers are more likely to use credit cards for larger purchases.
Source: Federal Reserve
Credit card spending continues to climb rapidly, especially in comparison to checks and electronic transfers.
Knowing this, it’s possible 60% of your tattoo removal revenue comes from credit card transactions. For each transaction, let’s say you pay an average fee of 3.5%, after accounting for processor markups such as monthly fees and hardware fees. Now, consider the following example:
Imagine if you could eliminate those credit card processing fees. Your tattoo removal profits would jump from $50,000 to $60,500. That’s a salary increase of 21%!As you can see, getting rid of credit card processing fees can boost your margins and enable you to take home more of your tattoo removal revenue. Think about what you could do with that extra $10,500 per year. You could:
Are you motivated to eliminate credit card processing fees now?
What you must do is shop for the best merchant service provider (MSP). When you analyze MSPs, understand the following fees and what’s negotiable.
Additionally, look for other fees, like account closure fees, voided transaction fees, and chargeback fees (which happen when a client disputes the transaction). These can make the cost of using a certain payment processor much higher, but you can negotiate these fees before signing a contract.You should also opt for pass-through pricing instead of a tiered pricing model. With pass-through pricing, you pay a fixed interchange fee as well as a variable fee and markup (based on card brand and MSP). Pass-through pricing is almost always cheaper and it avoids complex fee structures, which typically lead to you paying the highest amount possible.Finally, know the competition in payment processing gets intense. As a dermatology practice or medical spa offering tattoo removal, you don’t have to settle for what an MSP says, especially since your revenue is probably higher than the average small business. Use that leverage to negotiate the best and cheapest credit card processing possible.
Even with the cheapest credit card processing possible, you still have to pay fees. How do you avoid them completely? We have the solution: A cash discount program. With a cash discount program, you give tattoo removal clients a discount for paying in cash. If they want to pay with a credit card, you still offer that convenience through your payment processor. It’s just that they’ll pay a markup (which offsets the credit card fees). This way, you get the best of both worlds. Your customers can save money by paying with cash or conveniently swipe the plastic. And you don’t take an unnecessary financial hit from credit card processing fees. Interested? Talk with us at NadaPayments! We’re available anytime at +1 (929) 293-1800 or click the link below to leave a message.