Payment cards as a business

Business ideas by directions

It is not uncommon to find on the Internet a very attractive, at first glance, business idea for selling payment cards. It is not so much about selling, but about reselling cards, which seems to be a simple and easy thing.

And indeed, you need to buy a batch of cards in bulk, distribute it to retail outlets, set a mark-up of $10-15, of which $5 should be given to the seller, and the remaining $10 should be taken for yourself. Why not a great business opportunity? I sold 10 thousand cards a month, earned 100 thousand dollars. Great business idea. But only if it is really treated like a business.
In fact, building such a business without market research and a serious business plan is next to impossible.
Everyone who undertakes the implementation of this idea seriously is convinced of this. First of all, card providers are very reluctant to enter into agreements with small counterparties. After all, payment cards have expiration dates, among them there is marriage. Therefore, in the event of claims from the buyer, one must be prepared to either compensate for the damage or reasonably reject the claim. This cannot be done without accurate card counting. And accounting requires additional costs, and the more contracts, the more work. Therefore, it is more profitable for suppliers to conclude one large contract than to mess around with small ones. The amount of such an agreement can be hundreds of thousands of dollars per month.

Small entrepreneurs are simply not ready for such volumes. Therefore, they have to turn to wholesale suppliers. And those, of course, firstly, want to get their share of the profits, and, secondly, require reports from counterparties, or act according to the principle: sold-forgotten, not accepting claims in the future and shifting the risks to counterparties.

On the other hand, the entrepreneur cannot charge too high a premium on cards, so his margin in this case is much lower than $10. In addition, again, you need to either establish accounting or bear the risks. And these risks, in the absence of accounting, are not so small.
For example, the owners of outlets will definitely demand the conditions for the return of expired payment cards. If you do not keep records by card numbers, then there is a chance to receive expired cards from the partner, instead of those that he received from the entrepreneur and successfully sold.
And this is just one example of the risks that arise in the absence of accounting. And accounting, as already mentioned, is an additional cost. Therefore, building a business on the sale of payment cards can only be successful if all processes are thought out and calculated. To do this without a good business plan is possible only in dreams.

On our website you can order a detailed business plan for an enterprise selling payment cards with all the necessary calculations and recommendations. This will help build a really serious and profitable business, and avoid the risk of losses.