How Does the Integrated Payments System Work?

I've now built a system that lets you accept payment for orders when they are placed. Currently, this system lets you accept credit and debit cards (via Stripe.com). I do have plans on adding payment from bank accounts (via Dwolla.com), but the needed third-party tools to do this aren't in place yet. Adding PayPal is a future possibility, but given PayPal's hostility toward farmers markets and CSAs, I do not recommend using them.

To turn on the integrated payment system, click on "Edit Your Market's Info" on the "Your Account" page. Scroll down to "Payment Integration" system or click on the "Payments" shortcut on the top of the page. The first question asks if you want to use the system. Using it turns on a lot of optional behind-the-scenes software, including an expensive secure certificate (needed for any financial transactions). So, if you decide to use this system, your software fee will increase by 0.5%. That is, if your software charge is currently 3% of your market's sales (the base rate for using the software), checking this box will make it 3.5%.

It doesn't matter how many of the offered payment systems you use (once I have more options besides Stripe), you'll only get charged one additional fee. Most payment systems will have their own fees on top of what I charge for locallygrown.net, ranging from a few cents upwards to around 3%, so keep those costs in mind.

The second question asks if you want to only use this system. If so, your customers will not have the option to pay when they pick up their order. They must either already have enough money in their account to cover the order, or they must use a valid credit/debit card. You can take other advance payments to their account any way you wish (checks mailed to you, your own PayPal account, whatever), and put that money in their account.

The third option asks if you want to charge a "Customer Convenience Fee Percentage". Taking online payments will cost you, no matter what system you use. For example, Stripe.com charges 2.9% + 30 cents per transaction. PayPal has a similar rate. While most payment processors forbid you from charging an extra fee for only credit card customers, you are allowed to add a convenience fee for online payments. So, you can set your percentage to 3%, and that amount will get added to any online payment (and cover your additional expense). If you've ever bought a concert ticket from Ticket Master, you know how awful these convenience fees can be, so don't set it too high. 3% is probably just right, and I certainly wouldn't go any higher than 5%.

Stripe.com

To accept credit/debit cards, you'll need to go to Stripe.com and create an account. Stripe transfers money directly into your bank account (much like PayPal and Square), so you'll also have to give them your bank info. They'll transfer a few cents into your account as a test, you'll verify the amounts, and then you'll be good to go.

Once you've got your account set up and your bank account tied in, you can put your Stripe keys into your market's information, in the Payments section (the same place we were in above). Stripe has two sets of keys, Test and Live. You'll want to be very sure you use your Live keys, or else no cards will actually get charged!

Once you've done this, then your customers can start using their cards. On their "Your Account" page, they'll see a section where they can save their credit/debit card in the system. They can use all Visa, MasterCard, American Express, Discover, JCB, and Diners Club cards. Their card is not stored on my servers, but rather directly in Stripe.com's system (though your customers will never leave your market's site).

Accepting Payments

Once you have your payment credentials in the system, then your customers can start paying online. They can do it two ways: directly into their account, or on a per-order basis.

Once the card is in place (Stripe verifies the numbers as they put it in), then they'll see a verification on their "Your Account" page. They will also see a form where they can add money directly into their account. Some people will want to pay you in advance once a month for budgetary reasons, or to cash in on a bonus point promotion on their card, or some other reason. The amount they specify will get added straight into their account with no action from you, and your convenience fee percentage will get added to that amount when the card is charged.

They'll also have a link to change their card, or to remove it from the system altogether.

When they check out an order, if they don't have money in their account to cover it already, they'll see an option to pay right there. If they have already put their card in, they'll have a single button to charge their card. If they haven't, they'll have an option to add a card and charge it.

Charging Their Card

If they place multiple orders, whatever option they choose last will apply to all their orders. So, if they order with one card, then on their second order change their card info, only the second card will be used. If they say on their first order they'll pay when they pick up, but put a second order on their card, both orders will go to their card.

Their card will not get charged until you mark the order as complete. This gives you plenty of time to adjust their orders, take off things that didn't come in, add items they added to their order off an "extras table", whatever. This is the key to making the whole thing work simply. You don't have to put holds on their cards (which can be terrible for debit cards). You don't have to process refunds when things they ordered didn't come in. All of those headaches go away.

I highly recommend that you also use the Order Fulfillment System in conjunction with this. If you have internet access at your pickup location (even on smartphones or iPads), you can mark items as delivered or missing right as you fill orders. If they leave and later you find a bag you were supposed to give them, you can mark it then and there. If you don't have internet access there, you can print out the Packing Report and mark there, and then back at home use the Order Fulfillment System to record it all. If you do this, then the system will already know exactly how much to charge the customer's card. Additionally, if a customer checked out their order saying they'd pay when they picked up, but change their mind, you'll be able to put it on their card right there. Or the reverse, if they decide there to pay in person instead of use their card.

If you do not use the Order Fulfillment System, then the system will assume the customer received everything their ordered, and will charge their card accordingly. If they did not, you will need to manually edit their orders before you mark them as complete.

It is important that you mark all the orders as complete at once using the single link provided rather than closing them out one at a time. This will allow the system to combine orders as needed and run a single charge to the customer rather than individual charges for each order.

Keep in mind that Stripe.com takes seven days to put the money in your checking account. I have internet access at my pickup site (on my iPad), and so right after we're finished filling orders, I sit down and take a few minutes to make sure all the orders have been marked as filled, charge customer accounts for no-shows (if they don't have a card on file), refund items paid for but not received, and charge growers for items they were paid for but didn't bring. All that happens in the Order Fulfillment System, and takes ten minutes, tops. I then mark all the orders as complete right there. That charges their cards, and I'll get that money all the sooner.

When a card gets charged, the customer will get an email letting them know the amount charged, including the convenience fee. The market managers will get cc'd on this. Stripe.com will also send an email to the address you gave them letting you know the charge was processed. Everyone is notified, so no one should get surprised. A comment is also added to the order itself, so anyone can go back and see how a particular order was paid for.

If a card gets declined for any reason, the order(s) will not get marked as complete. You'll see them in your list, along with a message stating why the charge didn't go through. You have several options at that point. You could contact the customer directly, get them to change their card, and try again. However, I gave you a much simpler option. There will be a link there to just charge the amount to their account. This will email the customer letting them know that their card was not charged (and why), and invite them to go to the Your Account page and either fix it or add a different card (you'll get cc'd on this email). The order will then get marked as complete, and a comment will get added stating what happened.

And that's it! It's all very clean, there's no extra work on your part (if you're already using the Order Fulfillment System).

At my market, customers still have the option of paying when they pick up, but very quickly about a fifth of the orders were pre-paid. They also tended to be larger orders, so about a forth of the total dollar sales were pre-paid. Interestingly, those people also tended to buy more then they used to, so sales have gone up. things have become much easier at our pay station, since a fifth of the people can now skip the line. Since that time, more and more customers have put their cards on file, and over half of the orders are paid for this way.

Some of you want your markets to be pre-pay only, and this will make doing that very easy. It used to be a "nightmare" taking pre-payments, using my system or any of the others, but now it's easy-peasy. Let me know if you have any questions or troubles at all!