One of the things that a small or medium sized business owner should consider when setting up a merchant account is how easily the provider will be to accommodate merchant expansion in online payment processing systems . As your business grows, you’re going to want to expand the merchandise or services you offer to get more out of investment in security and credit card termnials , so you reasonably expect to be able to expand the products you offer. However, a merchant account’s provision and rates are predicated on a specific expected volume of chargebacks that is based on the products your store offers. Merchant account providers, online payment processors, and credit card suppliers all stand to lose money from chargebacks, so any expansion of products offered may require a reevaluation of your risk as a merchant.

There are two possible outcomes when you want to begin to offer new products.

1. The new products don’t vary a great deal from what you were already selling. For example if you are a sportswear retailer and you want to begin selling cold weather camping and exercise gear. These products are in a similar price range, meaning the cost of a chargeback is comparable, and they have an equally low likelihood of being the object of a chargeback. In this situation, since there’s no real change, you don’t have much to worry about and shouldn’t even bother letting your payment processor know about the new products.

2. The new products are not very similar to the rest of the products you sell. For example, you run a dive and surf shop, and you want to begin selling jet-ski type recreational water vehicles. While the risk of a chargeback itself may not be that different, with these new products that cost between 10 and 100 times as much as your other merchandise, the cost of a chargeback to the payment processor would be significantly higher. In this situation you should absolutely contact your processor. They will have to reassess your risk and may ask you to open a new, separate merchant account to handle the higher risk products, and offer you specific suggestions as far as online payment processing is concerned.

The difference is clear. This new account will mean added costs. As such, it is a good idea to consult with potential providers of real-time and online payment processing systems to understand how they anticipate responding to your likely growth. By discussing the directions in which you think you might expand and their perspective on customizing your merchant account experience, you can save yourself a lot of future costs.