How InterPayments Helped an Enterprise Dental Technology Provider Save $14M+ Annually with Minimal Technology Disruption

A leading dental technology provider looking to expand operating margins saw credit card surcharging as a prime opportunity to cut costs. But retaining their existing SAP integration was critical, and traditional surcharging solutions required a disruptive switch to a new processor and gateway. The company also needed to ensure that their surcharging was always compliant and that they could customize who would be surcharged and at what rates – in real-time – without taking on the significant complexity these tasks add. An associated company had successfully rolled out surcharging with similar requirements, so the company selected the same vendor, InterPayments, delivering similar success shortly thereafter.

About the Company

A leading dental technology provider that offers a variety of solutions for dental practices, from consumables to digital workflow technology, with a focus on partnerships to strengthen the professionals that keep everyone healthy.

Challenges

1. Recover fees on credit card payments – The company’s C-suite had a set goal to expand operating margins and saw the recovery of credit card payment fees via surcharging as a solution with immediate impact. Fees were taking up to 2.5% from every transaction, cutting millions of dollars from their profits every quarter. Lower-cost ACH and debit payments would not be surcharged, providing a way for customers to avoid the fee entirely.
2. Minimal disruption – Making major changes to the multiple ways orders are processed, both on the web and through SAP, would cause chaos in every part of the business. The impact would be felt everywhere, from the invoice creation of frontline sales to the workflow of accounts payable, all the way to the general ledger. This productivity drag can undo the savings gains of fee recovery, so wherever possible the existing SAP-powered system should be left in place. And even though surcharging compliance is an enormous and ever-evolving challenge, that complexity could not be passed on to the company’s busy accounting and legal teams.
3. Customer-centric flexibility – The company couldn’t risk losing control of any part of the customer experience that has led to so many satisfied customers. So the surcharging solution needed to be flexible, allowing for data-driven market segment targeting and real-time tweaks and reductions. The financial impact of these changes should also be tracked and detailed to inform future modifications.

The Solution

Among the surcharging solutions available to the company, only InterPayments offered both the ability to integrate directly into SAP and target surcharging for each customer. Fortunately, another affiliated company using the same technology had been surcharging for nearly a year, to great success. This existing relationship with InterPayments allowed for a considered rollout from a trusted provider.

Intuitive Surcharging Built into SAP

For the solution this company chose, InterPayments worked directly to integrate directly in the company’s SAP-native payment system. Surcharging capability was also added to the company’s AR solution, allowing for all varieties of one-time, open account, and recurring payments to be surcharged. Another integration ensured that surcharging would appear in every tool the company was already using to invoice clients while fully accounting for potential credits and returns.

A Tech-Forward Answer to Compliance and Customization

Integrating seamlessly into the existing SAP payment system was only possible because of InterPayment’s all-API-driven solution. This approach also allowed InterPayments to deliver maximum flexibility in terms of how the customer can choose to surcharge clients. To minimize customer impact, the company only wanted to surcharge 1.5%-2% of the value of the invoice, absorbing the rest of the 2.5% total fee cost. For smaller clients with smaller budgets, the surcharge would be waived entirely. The company also wanted to understand the exact dollar-amount impact of these decisions, so it could change them in real time as needed. InterPayments allows for all of this via its API connection, without impacting the SAP experience, while maintaining full compliance with every transaction.

Results

As a result of this one-time integration, the company expects to deliver operational savings of over $14 million per year. These anticipated gains would come from a combination of surcharges and customers moving to less expensive forms of payment and would begin to be captured as soon as surcharging takes effect. No negative customer impact is expected, as none was seen as the associated company. With early, frequent customer communication, combined with InterPayments training that covered every customer-facing team, customers gained an understanding of the need for surcharging, and how it helped the company keep prices down overall.

Interested in using InterPayments to power savings across your organization? Contact us today.

To keep the subject of the article anonymous, identifying details have been changed.