1) How Dockwa Makes Money: Credit Card Processing
One thing marinas love about Dockwa is that we make the reservation and payment processes seamless – as in, they don’t have to enter boater reservation details into a computer and then run a credit card separately. Which works out well for us, since that's where we make money.
Credit Card Processing: Percentage Points
Credit card companies (Visa, Amex, and MasterCard) charge businesses a per-transaction processing fee – a fee that varies dependent upon how much money a given business is processing. Typically the more money a business processes, the better the rate a credit card company will give the business. While a marina might run several or even hundreds of transactions a day, it's not a bad bet to say that with nearly 900 marina partners, Dockwa processes significantly more, garnering a better rate across the board on all transactions.
Credit Card Rates in Action
As a hypothetical scenario: Let's say each of our 900 marinas all charge boaters $1000 in one day. Visa, MasterCard, and AmEx would charge each marina a variable transaction fee per transaction, typically around 3.5% (generally between 2.9% - 4.5%).
If those same 900 marinas were all to process the $1,000 in payments through Dockwa's marina management software instead of their individual credit card machines, Dockwa would process $900,000 in that hypothetical day. Because of our transaction volume, we get a better rate. If our transaction fee is, say, 2.8%, we can then charge the marina a 3.5% flat transaction fee – roughly the same as what they had been paying – and we'd make .7% – $6,300 profit.
With that 3.5% transaction fee that the marina pays – the same if not less than they typically pay running credit cards individually* – the marina also gets marina management software with which they maintain their queue of incoming transient and long-term boaters, communicate with guests, and attract boaters by being included in the world's largest marina marketplace made up of one of the world's largest boater networks.
With Dockwa's flat transaction fee, the marina also gets the highest level of encryption for their boater data and personal/financial information. The marina also nixes the separate processes of reservation confirmation and payment processing – Dockwa handles both seamlessly. No more pen and paper, no more filing cabinets. Marinas increase security, organization, and communication, while streamlining accounting and saving processing time at little to no cost.
*Note: every card type (AmEx, Visa, debit cards, etc.) has a different rate, so the blended fee that each business actually pays can be difficult to measure.
Bonus: Penalty-free Cancelations
Full disclosure can go both ways, so while we're talking turkey here's a fun fact you may have missed: Unlike when paying a credit card company directly, Dockwa chooses to refund 100% of the reservation charge to the boater. We get charged the same transaction fee (it is, after all, a transaction!) but we don't pass that onto the boater or marina. Considering how many marina reservations are impacted by weather, this can add up quickly, and that's just the point: we want marinas to feel comfortable refunding, and hope that this leads to less stringent cancelation policies and thus safer boaters.
Note: Dockwa does not charge a fee on top of the credit card transaction fee.