By Katie Griffiths May 22, 2025
For dry cleaners, profit margins can be tight. Between equipment maintenance, employee wages, cleaning supplies and rent, every expense needs to be carefully managed. One often overlooked area where savings can be found is payment processing fees. Every time a customer pays with a card, a percentage of that transaction is taken by payment processors. While the fees may seem small per transaction, they add up quickly over weeks and months.
Reducing these fees does not mean compromising on service or technology. It means understanding how fees are structured, evaluating your current setup and making informed decisions. With the right strategies, dry cleaners can keep more of their revenue while still offering customers a fast and convenient way to pay.
Understanding the Basics of Payment Processing Fees
Before you can reduce your costs, it is important to understand how fees are structured. Each card transaction includes several layers of fees, usually categorized into interchange fees, assessment fees and processor markups.
Interchange fees are paid to the customer’s card-issuing bank and are set by the card networks like Visa and Mastercard. Assessment fees are paid to the card networks themselves. Processor markups are added by your payment processor as their profit for facilitating the transaction.
These fees vary depending on the type of card used, the method of payment and your business’s processing history. By knowing what goes into each transaction fee, you can better evaluate where adjustments can be made.
Types of Pricing Models
Processors use different pricing models, and the one you are on can significantly impact your total fees. The most common models include flat-rate pricing, tiered pricing and interchange-plus pricing.
Flat-rate pricing charges the same percentage on all transactions, regardless of the card type or method. It is simple but can be more expensive for businesses with a mix of card types. Tiered pricing groups transactions into categories, but it lacks transparency. Interchange-plus pricing separates the actual card network fees from the processor’s markup, offering more clarity and often better value.
Understanding which model your business is on helps you determine if you are paying more than necessary.
Strategies for Reducing Processing Fees
Once you understand how the fees work, the next step is to look for ways to lower them. This often involves reviewing your processor agreement, upgrading equipment and making minor changes to how payments are handled.
Negotiate with Your Processor
Many dry cleaners sign long-term agreements with payment processors without reviewing them in detail. But these contracts often include negotiable terms. If your business has grown or if you process a consistent volume of transactions, you may be able to ask for a lower rate.
It helps to compare your current processor’s rates with offers from other providers. Having this information gives you leverage when negotiating better terms or reduced fees. Some processors may also be willing to remove or waive monthly fees if you agree to a longer contract or increased volume.
Choose the Right Equipment
The type of terminal you use affects your processing fees. Chip-enabled and contactless payment terminals reduce fraud risk, which can lower your rates. Card-present transactions, where the customer inserts or taps their card, are generally less expensive than keyed-in transactions.
If your current equipment is outdated or lacks support for EMV and NFC payments, consider upgrading. Not only will this reduce fees, but it will also improve your checkout experience and help future-proof your business.
Encourage Debit Over Credit
Debit card transactions usually come with lower interchange fees than credit cards. While you cannot control how customers choose to pay, you can promote debit use by displaying signage or offering small discounts for debit payments.
Some dry cleaners also find success by offering loyalty incentives tied to preferred payment methods. These strategies can shift customer habits over time and lead to noticeable savings.
Avoiding Hidden and Extra Fees
Not all fees are directly tied to transactions. Some processors include additional charges such as monthly minimums, statement fees, PCI compliance fees or non-compliance penalties. These fees can often be reduced or eliminated with the right provider or by maintaining compliance.
Stay PCI Compliant
PCI compliance refers to a set of security standards that businesses must follow when handling card payments. Staying compliant not only protects customer data but also helps you avoid extra charges. Most processors charge a monthly fee for PCI compliance or a larger fee if you are non-compliant.
To stay compliant, complete your annual self-assessment questionnaire and maintain secure payment practices. Some providers offer assistance with compliance at no cost, while others may charge extra. If your provider is charging a high compliance fee, consider asking for a waiver or looking for a processor that includes it as part of their service.
Review Your Monthly Statements
It is easy to miss hidden fees if you do not regularly review your statements. Take time each month to go through your billing summary and look for unfamiliar charges. If something looks unclear, contact your processor for clarification.
Over time, these reviews help you identify patterns, spot unnecessary costs and ensure you are being billed correctly. A small time investment can lead to meaningful savings.
Choosing the Right Processor for Your Business
Not all payment processors are the same. Some specialize in small service-based businesses like dry cleaners and may offer better rates and support. When evaluating providers, consider their pricing structure, equipment options and level of customer service.
Look for Transparent Pricing
Processors that offer interchange-plus pricing are often more transparent than those using tiered models. This allows you to see exactly what portion of your fees goes to the card networks and what goes to the processor.
Ask for a detailed breakdown of rates and fees before signing any agreement. Providers that are unwilling to explain their pricing may not be the right fit for your business.
Consider Local or Niche Providers
Large national processors may offer competitive rates, but they often lack personalized service. Local or niche providers that understand the dry cleaning industry may be more flexible and responsive.
These companies may also offer value-added services like integrated point-of-sale systems, mobile apps or loyalty programs that help your business run more smoothly.
Educating Your Staff and Streamlining Checkout
Sometimes the way transactions are handled at the counter can affect fees. Staff should be trained to process payments efficiently, avoid unnecessary keying of card numbers and follow best practices for card-present transactions.
Train for Secure and Fast Transactions
Make sure your team understands how to use the payment terminal correctly. Mistakes like entering the wrong transaction type or manually keying in card details can result in higher fees. Emphasizing proper use of chip readers and contactless features helps reduce these unnecessary costs.
Also, having a clear and quick checkout process improves the customer experience. A smooth and fast transaction encourages repeat business and enhances overall satisfaction.
Conclusion: Small Changes, Big Savings
For dry cleaners, managing expenses is key to maintaining profitability. Payment processing fees may seem like a fixed cost, but there are many ways to reduce them without sacrificing service or technology. By understanding your current setup, negotiating better rates, upgrading your equipment and staying compliant, you can lower costs and improve efficiency.
With the right approach, you can transform payment processing from a silent expense into a well-managed part of your business. These savings can be reinvested into your operations, marketing or customer service, helping your dry cleaning business grow stronger in a competitive market.