What if you could save thousands of dollars a month and give customers a faster, smoother checkout, all without touching your rates? In episode 119 of Maximum Octane, Kim Hickey and Jason Patel talk with Dr. Mark Hale, a payments innovator and former QuickBooks CTO, about one of the most overlooked profit leaks in auto repair: credit card fees and surcharges.
Mark introduces Express by Facepay, an alternative to traditional payment processing designed to reduce fees, improve customer satisfaction, and simplify after-hours pickup. He explains what surcharges really cost, how one shop saved thousands, what the rental car industry can teach repair shops about checkout, and why shops need to stop resisting technology.
What You Will Learn
- How much surcharges are really costing your shop, and why your customers hate them
- Why Express is a win-win: no fees, no friction, no surprises
- How one shop saved thousands in just a few months
- What the “Fast Break” rental model can teach you about modern auto checkout
- How Express secures payments without risky card numbers or chargebacks
- Why customer experience is now your most powerful competitive edge
- The cultural shift: how to stop resisting tech and start designing for your customer
- Connect with Dr. Mark Hale:
- Express by Facepay
What Surcharges Are Really Costing You
Mark opens with how much surcharges really cost shops and why customers dislike them. Processing fees take a percentage of every card transaction, which adds up quickly on large repair orders. Some shops pass those fees to customers through surcharges, but customers often see surcharges as a hidden fee that damages trust. Rules around surcharging also vary by state and card network, so shops should review them carefully.
ATI’s Three Ways to Stop Trading Profit for Convenience touches on how small costs erode margins.
Processing costs are easy to overlook because they are deducted before the money ever reaches the bank account. A shop sees net deposits, not the fees taken out along the way. Pulling a year of merchant statements and adding up every fee, including interchange, assessments, monthly charges, equipment rentals, and chargeback fees, often surprises owners. On a business with high average repair orders, the total can rival the cost of a part-time employee.
Surcharging may recover some of that cost, but it shifts the burden to the customer at the worst possible moment: the end of the visit, when they are already paying for an unplanned repair. A customer who leaves feeling nickeled and dimed may not complain, but they may not come back. Before adding or keeping a surcharge, owners should weigh the savings against the effect on loyalty and confirm that disclosure follows card network rules and state law.
A Different Approach to Payments
Around the 8 minute mark, Mark explains how Express is designed to be a win-win: no fees, no friction, and no surprises, according to the company. He also shares the example of a shop that saved thousands of dollars in just a few months. Owners evaluating any payment platform should compare total costs, customer experience, security, integration with shop software, and support.
When comparing payment options, it helps to look beyond the headline rate. Ask how fees are structured and whether they change by card type, what equipment or software is required, how quickly funds are deposited, and what happens when a customer disputes a charge. Ask how the system connects with your shop management software so payments post automatically instead of being entered twice. And ask for references from other repair shops, since auto repair has different needs than retail, with larger tickets and customers who are often not present when work is completed.
Switching systems takes some effort, so owners should plan the transition, train the front counter, and explain any changes to customers in plain language.
Lessons From the Rental Car Industry
Mark discusses what the “Fast Break” model from the rental car industry can teach repair shops about checkout. Rental companies made pickup and return almost frictionless by handling payment and paperwork ahead of time. Repair shops can apply the same idea, letting customers approve and pay remotely so pickup takes seconds, including after hours.
Geoff Berman explores the value of convenience in How Convenient Is Your Auto Shop?
The lesson goes beyond payment. Rental companies studied every point where customers waited and removed as many as possible. Repair shops can apply the same thinking to the full visit. Online scheduling, digital vehicle inspections with photos, text-based approvals, and remote payment each eliminate a step that once required a phone call or a trip to the counter. Customers who can approve work from their phone and pick up a car with no line remember that experience, especially when the alternative is waiting behind someone else at closing time.
After-hours pickup is a particularly strong example. Many customers work the same hours a shop is open. Letting them pay in advance and collect their vehicle later serves them without extending staff hours.
Security and Chargebacks
Around the 22 minute mark, Mark explains how Express is designed to secure payments without exposing card numbers or creating chargeback risk. Reducing how often card data is handled lowers security risk. Whatever system a shop uses, it should follow standards from the PCI Security Standards Council.
Chargebacks are a real cost for repair shops. A customer may dispute a charge weeks after the repair, and the shop can lose both the payment and a fee while it gathers documentation. Clear, signed or digitally approved estimates, photos from inspections, and detailed invoices all help a shop respond to disputes. Reducing how often staff handle physical card numbers, such as by avoiding writing them down or keeping them on file in unsecured ways, lowers both fraud risk and liability.
Customer Experience as a Competitive Edge
Mark argues that customer experience is now a shop’s most powerful competitive edge. Convenience at checkout is part of that experience. A fast, transparent payment process leaves a positive final impression.
Many shops do quality repairs at fair prices, so customers often decide between them based on how the visit felt. Clear communication, accurate timelines, and a smooth checkout all contribute. The last interaction of a visit carries extra weight because it is what customers remember when they write a review or decide where to go next time. A surprise fee or a slow, awkward payment process can undo the good impression left by excellent work.
Stop Resisting Technology
Mark closes with the cultural shift shops need: stop resisting technology and start designing for the customer. Many owners avoid new tools because they seem complicated or unfamiliar. But customers expect modern convenience, and shops that deliver it will win.
Resistance usually comes from reasonable concerns: cost, training time, disruption, and the fear that older customers will not adapt. Those concerns can be managed. Pilot new tools with a small group before rolling them out to everyone, train staff thoroughly, and keep a traditional option available for customers who prefer it. Many owners find that customers of all ages adopt convenient tools quickly once they try them, and that staff appreciate fewer phone calls and less manual entry.
How to Evaluate Your Current Payment Setup
A practical review can be done in an afternoon. Start by gathering the last twelve months of merchant statements and calculating total fees as a share of card volume. Note any equipment leases or long-term contracts and their cancellation terms. List every step a customer goes through to pay, from approval to pickup, and mark where delays or confusion occur.
- Ask front counter staff which payment questions or complaints come up most.
- Review recent chargebacks and what documentation would have helped.
- Check that your surcharge or convenience fee practices, if any, follow card network rules and state law.
- Confirm who has access to payment data and how it is stored.
With that information, you can compare alternatives on equal terms and make a decision based on total cost and customer experience, not just a quoted rate.
Common Payment Mistakes Shops Make
One common mistake is signing a processing contract without understanding its fee structure or termination terms. Another is adding a surcharge without explaining it to customers in advance, which turns a policy into a surprise. Some shops still store card numbers in files or notes for repeat customers, creating unnecessary security risk. Others ignore after-hours customers entirely, missing an easy way to add convenience. Finally, many owners never revisit their payment setup once it is in place, even as better options become available.
Payment Review Checklist
- Calculate how much you paid in processing fees last year.
- Review whether surcharges are hurting customer satisfaction.
- Ask how customers can approve and pay before pickup.
- Confirm your payment system meets security standards.
Mark’s first episode, Removing the Veil of Mystery Lying Over Crypto and Blockchain, covers digital currency. Lisa Coyle and Jesse Meddaugh discuss contactless payments in Put People First and Think About What They Want.
Frequently Asked Questions
Should my auto repair shop charge a credit card surcharge?
It depends on your margins, customers, and local rules. A surcharge can offset processing costs, but many customers dislike it and may see it as a hidden fee. If you consider one, review card network rules and your state’s laws, disclose it clearly before work begins, and watch for effects on reviews and repeat business. Some shops prefer to build processing costs into pricing or look for lower-cost payment methods instead.
How can I lower credit card processing fees at my shop?
Start by reviewing a full year of merchant statements to understand what you pay and why. Compare pricing structures from several providers, ask about fees by card type and any hidden monthly charges, and check contract terms before switching. Consider alternative payment methods that reduce card costs. Make sure any new system integrates with your shop management software so you do not trade fee savings for extra labor.
How can customers pay for auto repairs after hours?
Many shops let customers approve estimates and pay remotely through a secure link sent by text or email. Once payment is complete, the customer can pick up keys from a secure drop box or locker. This approach is convenient for people who work during shop hours and reduces end-of-day crowding at the counter. Make sure your process confirms identity and documents payment before keys are released.
How do I reduce chargebacks at my auto repair shop?
Get clear written or digital approval for every estimate and any additional work. Use digital inspections with photos to document the condition of parts that were replaced. Provide detailed invoices and communicate with customers throughout the repair so there are no surprises at pickup. When a dispute does happen, respond quickly with your documentation. Good communication prevents many disputes before they start.
What security standards should a repair shop’s payment system meet?
Any business that accepts card payments should follow the Payment Card Industry Data Security Standard, known as PCI DSS. In practice, that means using a reputable processor, avoiding storing or writing down card numbers, limiting who can access payment data, keeping software updated, and securing your network. Ask your provider how their system helps you stay compliant and what your own responsibilities are.
