Letters to the Editor
Good Afternoon!
I appreciate your review of our Fall Meeting in your most recent Green Sheet. It's always nice to get a little press! I also want to tell you that your last paragraph is right on...I have been saying this forever and I believe it.
With members such as yourself, we will move ETA into a stronger position with every turn. I'm excited with our progress and even though I know we have a long way yet to go, I am encouraged with the direction and involvement I see from our members and board of directors. And, like you said, we are only as strong as our members and I know that myself and staff are working hard to get our members more involved.
Thanks for your continued support as an ETA member and keep those suggestions and comments coming!
Ken Bowman
Do you have any idea what check guarantee companies are selling for? Are there any rules of thumb in the check guarantee industry that buyers and sellers use to determine a price for a check guarantee company?
Any and all information will be greatly appreciated.
Tony Centanni, CPA
LaPorte, Sehrt,
Romig & Hand
Dear Tony,
The following is the Check Guarantee acquisition analysis of major purchases made in this industry during the past 7 years. (Dollars are in Millions)
Telecredit sold in 1990:
FAA (face value of checks approved) $7,900
Revenue $98
Weighted Rate 1.24%
Purchase Price $457
Ratio to FAA 5.78%
Ratio to Revenue 465%
TeleCheck sold in 1992:
FAA (face value of checks approved) $9,500
Revenue $120
Weighted Rate 1.26%
Purchase Price $159
Ratio to FAA 1.67%
Ratio to Revenue 133%
JBS sold in 1992:
FAA (face value of checks approved) $6,000
Revenue $50
Weighted Rate 0.83%
Purchase Price $60
Ratio to FAA 1.00%
Ratio to Revenue 120%
Please do not hesitate to contact me if you have further questions.
Paul Green
Editor-in-Chief
We are an ISO organization that has had some legal problems getting paid by a group of businesses that are much larger and have more financial resources than we have. Do you have any suggestions for us?
Bill Stoute
Bill:
Sometimes small business owners need expert advice that they really can't afford. Despite the prohibitive costs, entrepreneurs need an army of experts on retainer to protect them from today's legal pitfalls. I have seen organizations, such as Pre-Paid Legal Services (www.ppisi.com), that offer access to a large network of attorneys for a low monthly fee, including legal consultation, contract review, legal correspondence, and discounts on litigation fees.
My experience tells me that a strong letter could help. The nature of a Car Dealer's business makes them less likely to want to go to court, but then it depends on how much is a stake, and how egregious they believe your actions were.
Hope this helps.
Good Selling!SM
Paul H. Green
Editor-in-Chief
Don't know if I am writing the right person, but found your site on-line and hope you might help me.
I live in Indiana and was written a bad check (NSF) by an individual who lives in Lansing, Michigan. The check was reimbursement for expenses incurred to travel to MI for a job with the company which this woman owns (believe it or not!) The check is in the amount of $162.50. The woman will not return my calls, and refuses to discuss this matter with me.
Do you have any advice to me at all on how to proceed?
Thank you very much,
Ann Gambrell
Gambrell:
I would suggest that you submit a complaint to the Lansing Labor Board, a complaint to the Michigan Attorney General, and if that doesn't work, consider driving back and filing a small claims suit.
You can get your travel cost on each of the trips, the one you were not paid for, and the two that it will take to file in person and appear at trial. Remember that the reason for the check's return is important in your small claims court action. If it is really NSF, it is likely that you can claim fraud, and may be able to get more than the face amount. Be sure to write and asked to be reimbursed, and send the letter registered and keep a copy for trial and send one with your complaints.
Good Luck
Paul H. Green
Editorin-Chief
I recently read with interest several of the articles your newsletter has published regarding check truncation. Of special interest to me was the article on the pilot program conducted at Soccer and Sports in Rohnert Park, CA. Obviously, the proprietor of that store has struggled with a solution that has fallen short of the expectations laid out to him by the people that sold him the system. I think it is important, however, to not condemn the entire process based on this singular experience. Superior alternatives do exist and are out in the market. For example, BankServ's solution:
1) Removes the burden of handling Notice of Change (NOC's) from the merchant
2) Is priced to make handling checks through truncation the far superior economic choice
3) Has a proven track record of reducing check losses due to some of the inherent timeliness benefits of the ACH system
4) Eliminates the need for the merchant to warehouse months of voided checks
5) Can be integrated into existing point of sale systems, thus reducing the need to purchase some of the required hardware.
I would welcome the opportunity to discuss these benefits with you in greater detail. It is my sense that you are generally skeptical to the advantages of this solution. I believe upon further examination you will recognize the benefits our customers have and become a proponent.
It is also important to note that a DDA is a Demand Deposit Account not a Direct Deposit Account. Additionally, in the last six months I have personally met with nearly all of the top 30 retail banks in the country and all but one or two process ACH items before paper checks and provide greater detail on ACH transactions than they do check transactions in their DDA statements.
Sincerely,
Michael J. Dionne
National Sales Manager
BankServ
Michael:
Thank you for your response. It will appear in the next possible Green Sheet. I have asked several people to respond to my article, but you are really the first feedback.
Your comments on check presentation are based on banks, mine on clearing house responses, which precedes bank processing more often than not.
Good Selling!SM
Paul H. Green
Editor-In-Chief
