Get a High Risk Nutraceuticals Merchant Account Fast with DigiPay
The nutraceutical industry exists in a space between highly regulated medicines and unregulated foods and supplements. Sellers require a high risk nutraceuticals merchant account and high risk nutraceuticals merchant services because of the regulatory possibilities and a high rate of customer issues. Getting an account is a simple application process. Digipay Solutions arranges the payment gateway and supports like chargeback management systems.
Understanding the Basics of High Risk Nutraceuticals Processing
E-commerce and online sales are an essential part of the nutraceutical business. Nutraceuticals involve pharmaceutical preparations for individual consumption. The nutraceutical industry exists in a regulatory environment, and it has a higher than average rate of chargebacks. Because of the nature of the products sold, which are dependent on a wide range of customer opinion and consumer satisfaction, most nutraceutical businesses must use high risk acceptance. They must apply for a high-risk merchant Account and related merchant account services.
The Nutraceutical Merchant account consists of a Merchant identification number (MID), one or more terminal identification numbers (TID), and a gateway identification number (GID). Online sales must have a reliable system for taking and processing online payments. The Merchant Identification Number or MID is the beginning of the chain. The unique identifier must also match and assigned Gateway ID and TID. Together, the ID numbers make a functional payment processing path.
- MID is a unique identifier assigned to each merchant account; this number identifies the merchant.
- TID is an additional ID number assigned to each merchant profit center that generates orders for processing.
- GID is the online location for front-end acceptance and back-end settlement of orders, including chargebacks, refunds, and cancellations.
Nutraceuticals is a Global Growth Industry
The global nutraceuticals business reached total sales of approximately $180B in 2015; the industry projection for 2017 exceeded $204B. The US share of the global market was substantial. In 2015, US sales were about $74B or 40 percent of the global market. Of the entire US sales volume, 37 percent were in dietary supplements.
Your high risk nutraceutical merchant account is a tool for success in the rapidly expanding nutraceutical business. The projected annual industry growth rate of 6.3 percent bodes well for manufacturers and sellers.
High growth projections apply to the below-listed SIC and NAIC product classes:
- SIC 2834 – Pharmaceutical Preparations
- SIC 2833 – Medicinal Chemicals and Botanical Products
- NAIC 325412 – Pharmaceutical Preparation Manufacturing
High risk nutraceutical merchant services depend on proper management. A key aspect is to keep chargebacks low. Chargeback ratios that exceed the permitted level of 2% or less will often end with account cancellation.
Nutraceutical Business Models
Many sellers use straight sales for their products, and this practice can minimize the difficulty of getting started. Many processors can handle this type of sales. The dominant approach and one that produces high margins offers free trials. Trial purchases are potent sales techniques for nutraceuticals because they inspire customer confidence that the product will work and work well for them.
The free trial model is important for developing sales and increasing sales volumes. Let us help manage your preference for the number of trials and the number of trial days.
We can offer high rates of acceptance high risk nutraceuticals merchant accounts due to our extensive range of services and depth of experience. We understand the key points in high risk nutraceutical merchant services, the nutraceutical business models, and have worked regularly with banks, underwriters, and credit card companies.
The start of the high-risk services usually has a volume limit. The amount varies by provider and customer qualifications, but it is usually in the range of $25,000 to $50,000 per month. This initial volume level is usually workable for sellers until they have had enough time to establish a customer base and to develop and carry out an effective marketing plan.
Increasing the Monthly Volume:
The factors involved in the decision to increase the high risk merchant account volume limit include chargeback management, as described in the below-listed items.
- Maintain a consistent and low chargeback ratio
- Keep a relatively constant monthly volume
- Maintain a range of regular transaction sizes
- Demonstrate financial growth and good financial standing
- Managing Nutra-Business Chargebacks
Chargebacks are disputes from a customer to its credit card company to dispute a billing or a transaction. Chargebacks are a particular problem for the nutraceutical business. Sellers can reduce or avoid chargebacks by accurate records, clear presentations of the transaction that show consent. Many top sellers emphasize customer relations and resolution of complaints. Statistics show that nutraceuticals attract more chargeback problems that most types of sales. There may be many causes for this, but research has identified a few that may also be avoidable.
- Many nutra-businesses are small startups that do not have a robust system to capture complaints and resolve issues with dissatisfied customers.
- Many nutritional product sellers promise results that may not occur or occur as expected. High expectations are a constant source of potential chargebacks. Customer relations and information are excellent tools for avoiding failed expectations.
- Some businesses use a membership, continuous, or recurring billing model. With these recurring billings, experience shows that a percentage of customers will fail to realize the process and reject the bill.
- Small businesses and start-ups may lack the adjustment and refund processes typical of large or brand name businesses. Brand name companies often incorporate satisfaction and price guarantees in their advertising and product promotion. The difference may lead to chargebacks because customers will not have enough information to pursue other means of resolution.
A Growth Market Awaits
Learn More about the DigiPay High Risk Nutraceuticals Merchant Account and High Risk Nutraceuticals Merchant Services. At DigiPay Solutions, we dedicate capacity and make special efforts to help merchants process payments for all types of nutraceutical product sales. Contact us today to learn more about accounts, marketing support, and merchant services. Call and find out the most cost-effective way to join or expand in the nutraceutical boom!
About The Author: Sandy Travers
Payment technology executive Sandra Travers is Co-Founder & Co-CEO of DigiPay Solutions, Inc.. Her years of experience in early-stage technology ventures brings a unique perspective to payments. Sandra manages operations and risk in addition to new product development.
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