How to Avoid Chargebacks

Chargebacks can cause a great deal of trouble for a business, especially when merchant accounts initiate fees for them. Credit card processing has a wealth of benefits, but it also has complications such as consumer chargebacks. Consumers initiate chargebacks for a wide variety of reasons including fraud, attempted theft, honest mistakes and discontent. Every business […]

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Building Your Small Business

Accepting credit cards is a necessity for small businesses because it allows them to remain competitive, offer convenient payment methods to buyers and not forego a sale in the event customers come up short of cash. Understanding the world of credit card processing can seem daunting at first, but these 3 key principles help address […]

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Reading Reviews Before Selecting Your Merchant Account Provider

When looking to select a company to use as a credit card processor, it’s wise to choose one that offers all the right services at a good price. However, one should take it further, and here are three things to look at when reading reviews for a merchant services provider. Speed: Without a doubt, if […]

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All About Flagship Merchant Services

Flagship Merchant Services has been helping merchants conduct transactions online for many years. As a leader in credit card processing and merchant accounts services, Flagship Merchant Services has remained focused on giving business owners of all size the solutions they need to effectively do business completely online. How does credit card processing work? There are […]

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All About

Without a doubt, when looking to get credit cards processed, one should go with a solid, reliable and trustworthy company. When doing so, it’s easy to avoid mistakes that others suffer from. While true, one should know where to look, and is a great place to go, and here are three reasons why. Provide […]

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What is the Bankruptcy Notification Service?

Without a service, it’s hard for people to know when someone went bankrupt, and this is often a problem when dealing with merchant accounts or other financial services. For this reason, the two major worldwide credit card companies, Visa and MasterCard, have developed a service to help people track bankruptcies. With this, people can see […]

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Average ticket size can be used to calculate how merchants choose to conduct businesses with banks. The calculated amount is extremely important in determining risks and evaluating the company. An average ticket size or average ticket limit when evaluating a new client.

What is it?

The average ticket size is calculated by using the average dollar amount of a credit card transaction. Sometimes the metric is referred to as the average ticket. The amount the average customer spends for goods or services are used to calculate these amounts. The credit card transactions are determined by calculating the average amount of a transaction in the future.

How is it calculated?

The business divides the total amount credit card transactions by the number of transactions made in order to identify the value. If working with a merchant account solutions provider, the amount is calculated during a statement review. The calculation is basically the average unit value.

Formula: average size of sales / credit card amount

Compared to average ticket limit

In some cases the average ticket limit is requested. The highest sale amount can be provided to the institution instead of the average ticket size. Merchants who process smaller tickets more often than larger ones may benefit from this model.

How average ticket size impact how business is done with a bank?

If a merchant’s average ticket size is above thousand dollars, the banking institution may require more of the applicant. The person may have to apply additional documentation. A transaction history can span three months of recent financial statements. Additionally, tax returns may be required.

Why is it used?

The average ticket is used to better understand how much a risk taking on a merchant would be for a processor. The institutions use this when evaluating an applicant. The amount can also be used to determine profitability. The credit card processing volume is requested in addition to the average ticket.

Average ticket amount is used to evaluate the merchant. When applying for a merchant account, the average ticket limit or the average ticket size is requested in addition to the credit card processing volume. Merchant account applicants may be required to offer additional documentation depending on their ticket amount.