The sale of bongs, glass pipes, and other glassware can sometimes be a difficult proposition. There are perfectly legal and legitimate uses for selling these products in the USA, which may also include a water bong, water filtration systems, ash catcher, vaporizers, various silicone products, or more. The similarity of a smoking device may bear a resemblance to products that are used in the consumption of CBD, cannabis, or other drugs. These drugs are still illegal at the federal level and in the majority of states in the United States. This can create a major challenge and headache for your businesses. This often means that getting access to the basic tools of business, like banking or credit card payments, can be more difficult than it should be.
There are ways that you can sell these products and still have access to merchant account services that can ensure your business can take credit card payments and be successful. This can happen for any vendor of bongs, pipes, and glassware, regardless of the quality of your goods or the location of your business.
You do need to take extra precautions in this highly regulated business and you may find it an expensive challenge to access merchant account services that you’ll need to be successful. Fortunately for you and your business, there are plenty of ways that you can do just that.
What Sort of Financial or Legal Exposure Might My Business Face?
As you’re probably aware, the sale of the above material can often be misconstrued as selling drug paraphernalia. That does not mean that you’re selling drug paraphernalia, as there are many legal uses for these products. It’s vitally important that your business makes it clear that the sale of your equipment not be misconstrued for the sale of drug equipment. You may require multiple checks and statements on your website or in your place of work that reconfirms this fact.
You’ll need to see an attorney to get specific advice on how to shield yourself from any legal liability that the sale of these materials may bring. This text should not be construed as legal advice: Only a qualified attorney can give you that. When it comes to accessing merchant account services, any statements may be vital. A merchant account vendor won’t want to facilitate the sale of any illegal items, so it’s vitally important that you have any necessary disclaimers that are needed to satisfy these concerns.
Can I Access Merchant Account Vendor Services?
Yes. There is no question that you can access merchant account vendor services if you’re selling smoking accessories, including glass blunts, recyclers, glass pipes, water pipes or glassware. This may be a challenge, as some merchant account vendors may not be willing to work with a business that bears a resemblance to one that would sell items similar to those used in drug activity. It isn’t impossible, but it may be a challenge. Unfortunately, you may find your business classified as a high-risk merchant.
It’s vitally important that your business explain the non-drug-related uses of your online headshop. This means explaining how the various glass bowls, bubblers, sherlock pipes and mouthpieces can be used in ways that do not involve the consumption of illegal drugs. This can be done by having other content, including content that explains how your products can help improve the smoking experience for users. For example, you could take various accessories that you sell, including glass water pipes or a glass spoon pipe, and explain the various ways it could be used. You could also discuss dry herb, carbs, percs, and other related items, explaining the various ways that these items are not related to drugs. A FAQ section of your website can also help to drive this point home.
What Is a High-Risk Merchant?
A high-risk merchant is a business that has a greater risk of fraud or chargebacks. There are no formal laws or industry standards of what defines a high-risk merchant and most merchant account vendors will set their standards about what makes a business high risk. Generally speaking, vendors that do work with high-risk merchants will charge you higher fees and may have a more stringent application process for you to get started with their services. While this can be more expensive for you and your business, there are ways that you can reduce your costs and work with your merchant account vendor to keep your costs low.
Why Is Selling Bongs, Glass Pipes or Glassware Considered High Risk?
Selling bongs, silicone pipes, water pipes, recyclers, or glassware comes with some unique challenges, regardless of where your business is located and how you make these sales. These challenges include:
- Adherence to local, state and federal law: As noted above, the sale of drug paraphernalia is illegal and there are many similarities between the sale of legal mini bongs, pipes or glassware and the sale of illegal goods. To be clear, this does not eliminate the possibility of you making these sales, but it does make them more challenging. You’ll have to find a merchant account services provider who understands that you’re seeking to sell legal goods for legal uses. This can be a challenge, but it’s still possible.
- Legal costs: Your business may incur additional costs related to compliance and enforcement because of the specialized nature of the products that you serve. This may also require that your merchant account vendor engage in a variety of legal protections to ensure that they’re staying within the confines of the law and this may result in high-risk classification.
- Fraud or chargebacks: Many account vendors may determine that your industry is at a higher risk of suffering from fraud or chargebacks. A chargeback is what occurs when there is a refund on a credit card charge. This, of course, represents lost revenue and additional expenses for both your business and your merchant account vendor.
How Can a Merchant Account Provider Work With This Industry?
You need a merchant account provider who can not only provide you with access to the vital financial services that you need but one who can understand your industry and work with you to reduce your financial exposure. You should be able to find such a provider.
You need a merchant account provider who can provide you with a high-risk payment gateway. This means that your vendor is capable of setting up a method for you to accept payments on your website and using multiple credit cards, online vendors or more. They should take all of the standard cards, of course, but they may also need to accept payment using methods like Stripe or PayPal. Depending on your business plans, you may need to examine setting up a payment gateway that can take payments in cryptocurrency. This is proving to be an increasingly lucrative market for many vendors and maybe a good idea for you to invest in. ACH payments are another critical payment method to examine. ACH payments occur when one bank directly pays another bank.
If you’re a regular retail merchant who runs a smoke shop, you may not need this feature. If your business sells mini bongs, pipes or glassware to individuals who then resell them – meaning you’re acting as a wholesaler – you may find that this is a feature well worth investigating. In total, you want to make sure that your merchant account provider can manage all of your eCommerce options, no matter how someone makes a payment. This is about so much more than just how payment is made and accepted: You need a merchant account provider who can properly integrate with your various eCommerce plans. This means that they will need to be able to manage shipping, taxes, accounting and more.
Depending on the scope of your sales, you may also need to find a vendor who can do business in foreign countries and with foreign currency. This may not be necessary for your business, but depending on your long-term expansion plans, it’s probably a good idea to at least consider this option. Of course, digital options aren’t the only way that people make payments. Many still pay with checks and you want to make sure that you have a processor that is established which can handle checks or the still-used eChecks.
If you operate a brick-and-mortar location, you’ll want to confirm that your merchant account provider can handle any in-person payments and be able to process checks. You’ll also want to make sure that you select a vendor who can ensure that all of the ways you accept payments are integrated into any account service you have, thus guaranteeing an accurate recording of your financial transactions and making it easy for you to pay taxes at the end of the year.
What Else Should I Look For?
All of the above-listed services and specialties are just the start of how a merchant account provider can properly assist you. A merchant account provider – especially for a high-risk service – needs to be able to do more than just provide you with services. You need a company with experience in this area that is capable of doing so much more than just allowing you to process credit cards.
You need to find a merchant account provider who has ample experience in the area of fraud and chargeback reduction. Remember, it’s absolutely in your best interests to cut down on both of these problems, as doing so can reduce processing fees and help you maintain inventory while avoiding losing valuable dollars on fraudulent sales. Some vendors will offer fraud protection or give you access to a variety of tools that can cut back on fraudulent sales. A merchant account company has to be able to provide you with the physical and digital methods by which you can accept payments. This is more than just copying and pasting a line of code into your website and should also involve:
- All necessary point of sale equipment. This means the machines that will process payments and the software that can be used to help you track these payments. Of course, equipment alone isn’t enough: A merchant account provider should also provide you with customer support, training and assistance. They have to teach you how to integrate your new equipment with your existing software and how to make sure you’re getting the most out of your new service.
- A gift card or loyalty program. If you’re looking to build a base of returning customers, you need to make sure that you make it easy for those customers to do business with you over and over again. This means that you’ll need a vendor who can easily and seamlessly set up a gift card or loyalty program on your website and in your checkout.
- Other services as you need them. The glassware, bong and pipe industry is growing more and more by the day, particularly as more people seek alternatives to traditional cigarettes or nicotine consumption. That means that your business may be well-positioned to expand. What good is being in a growing industry if you don’t have access to the financial resources that can allow you to take advantage of it? As such, how can your merchant account provider help you grow and take charge of market dynamics? Do they have access to business capital that you can use to grow your business? Can they help you with ATM purchases or access to cash when you need it? How quickly do they process payments and get the money into your account?
Finding a good merchant account provider can make a huge difference for your business: They can help limit your fees, improve your bottom line, reduce fraud, expand your business and so much more. This is why finding the right merchant account provider is so critical to your long-term success. If you have questions on what this means or are looking for more information, contact Zenti today and learn how we can help your business grow.