By Karen October 8, 2025
For multi-location retailers and franchise operators, managing payment processing costs across multiple sites can be complex. Each store, kiosk, or franchise location typically requires its own setup for card acceptance, and with that comes added fees. One of the most significant but often misunderstood costs is the Fixed Acquirer Network Fee (FANF), charged by Visa and passed along by processors. FANF applies differently to multi-site merchants compared to single-location businesses, making it critical for operators to understand how it works. In 2025, as retail franchises continue to expand across New Castle and beyond, merchants must learn how IDs, location counts, and consolidation strategies directly affect their FANF obligations.
FANF is not negotiable; it is set by Visa and enforced across the acquiring ecosystem. However, the way it is applied depends on how many merchant identification numbers (MIDs) a business has, how its locations are reported, and whether consolidation strategies are used. For multi-location businesses, this means that structuring IDs and managing processor relationships is just as important as understanding overall transaction fees. With the right approach, merchants can reduce unnecessary expenses, maintain compliance, and avoid surprises on their monthly statements.
Understanding FANF for Multi-Site Merchants
The Fixed Acquirer Network Fee was introduced to cover the operational costs of maintaining the Visa network. Unlike percentage-based interchange fees, FANF is a flat monthly charge applied to merchants based on their business type and structure. For single-location retailers, FANF is usually determined by transaction volume or merchant category. For multi-location businesses and franchises, the calculation changes, focusing on the number of locations and how they are identified in the payment ecosystem.
This means that a retailer with 10 stores may see FANF applied differently than a franchise with 50 individually operated sites, depending on how each is set up with their processor. Some may pay per location, while others may qualify for consolidated reporting that reduces overall expenses. The key for multi-site operators is understanding how Visa defines a “location” under FANF rules and how merchant IDs influence billing. Without this knowledge, retailers risk paying far more than necessary simply because of how accounts were structured.
The Role of Merchant IDs in FANF
Merchant identification numbers, or MIDs, are central to how FANF is calculated. Each MID represents a unique merchant account, usually tied to a specific store or location. For multi-site retailers, this often means that every store has its own MID, leading to separate FANF charges for each. Franchises with multiple operators may have dozens or even hundreds of MIDs across the network, multiplying the total expense.
In some cases, businesses can work with processors to consolidate multiple locations under a single master MID or use chain reporting options that group accounts together. This can significantly reduce FANF costs by lowering the total number of billed locations. However, consolidation is not always possible for franchises with independently owned stores, where each operator requires their own merchant account. Still, by carefully structuring how MIDs are assigned and managed, multi-location merchants can optimize FANF obligations and avoid unnecessary duplication of fees.
Counting Locations: How Visa Defines a Site
For FANF purposes, Visa defines a “location” as any distinct merchant outlet where transactions occur. This includes traditional retail stores, kiosks, and sometimes even online divisions treated as separate entities. Multi-site retailers must be careful in how they report locations, as overcounting can lead to inflated FANF bills. For example, a business with multiple registers in one store is not considered to have multiple locations; the entire store counts as one. Conversely, a business with several stores across New Castle will have each counted individually.
Franchises are particularly affected by this rule, as each franchisee’s store is treated as its own location, even if the brand operates under a single corporate umbrella. This can lead to large FANF obligations when dozens or hundreds of franchise locations are involved. The only way to minimize costs is to explore whether consolidation options apply and to ensure accurate reporting. Merchants must maintain clear documentation of location counts to avoid disputes or audits from processors.
Consolidation Strategies for Lower FANF Costs
Consolidation is one of the most effective ways to manage FANF for multi-site merchants. By grouping locations under fewer MIDs or using master account setups, businesses can reduce the total number of locations Visa considers for billing. Some processors offer chain-level reporting where multiple sites roll up into one account, simplifying both billing and management. For large retailers, this not only lowers FANF but also streamlines reporting and reconciliation across stores.
However, consolidation is not always straightforward. It requires coordination with acquiring banks and processors to ensure that transactions are routed correctly while maintaining compliance with Visa rules. Franchises may have less flexibility, as independent owners often prefer their own accounts for autonomy. Still, corporate franchisors can sometimes negotiate group agreements that reduce FANF at the network level. For both retailers and franchises, consolidation represents a key strategy for controlling costs, but it must be planned carefully to avoid disrupting operations.
Balancing Growth with FANF Obligations
As multi-location businesses expand, FANF obligations naturally grow. Each new store or franchise location adds to the total number of counted sites, increasing monthly fees. This means that rapid expansion, while beneficial for revenue, can create unforeseen processing expenses. For businesses in New Castle opening new stores, it is critical to factor FANF into financial planning from the outset. Ignoring these costs can lead to margin compression as the number of sites grows.
The best approach is to model FANF expenses alongside other fixed costs when evaluating expansion opportunities. This ensures that new locations are profitable even after accounting for network fees. For franchises, understanding how each additional operator impacts FANF helps corporate leaders set realistic expectations for franchisees. By making FANF part of growth planning, retailers and franchisors can avoid being blindsided by rising costs and maintain profitability across all sites.
How Processors Communicate FANF to Merchants
One of the ongoing challenges for merchants is that FANF is not always clearly explained by payment processors. Many multi-site retailers first encounter FANF when it appears as a line item on their monthly statement, often without much context. This lack of transparency can create confusion, particularly when fees increase as more locations are added. Merchants should demand detailed explanations from processors, including breakdowns of how FANF is calculated and how location counts are reported.
Choosing a processor with strong transparency practices can make a significant difference. Some acquirers specialize in working with franchises and multi-location businesses, providing clear FANF reporting and guidance on managing IDs and consolidation. Merchants should not hesitate to request documentation or clarification, as understanding FANF is critical to long-term financial planning. Better communication also helps avoid disputes when new stores are added or when consolidation arrangements are made.
The Impact of Hybrid Operations
Many multi-location retailers now operate hybrid businesses that combine in-store sales with ecommerce channels. For FANF purposes, online operations are often treated separately under card-not-present categories, leading to additional fees alongside the location-based charges for physical stores. This can complicate billing for merchants that must manage both structures simultaneously. For example, a retail chain with ten physical stores and a robust ecommerce platform may face FANF fees for both.
Managing hybrid operations requires a clear understanding of how processors categorize different sales channels. In some cases, merchants can align reporting to streamline FANF charges, while in others, separate accounts are necessary. Retailers must evaluate whether the added ecommerce FANF costs are offset by online revenue and adjust strategies accordingly. As more multi-location merchants expand into digital sales, this dual-structure challenge will become increasingly important to manage.
Preparing for the Future of FANF
Looking ahead, FANF is unlikely to disappear, but its application may continue to evolve as retail models change. Visa’s goal with FANF is to fairly distribute network maintenance costs across merchants, and as digital transactions grow, multi-location businesses must adapt to the shifting landscape. Future updates may refine how locations are defined or how consolidation is applied, especially as more merchants operate both physical and digital channels.
For New Castle retailers and franchises, staying informed is essential. This means monitoring processor communications, reviewing statements closely, and keeping up with changes to Visa’s fee structures. Businesses that remain proactive will be better positioned to control costs and adapt as FANF evolves. Ultimately, managing FANF is not about avoiding it altogether—it is about structuring operations intelligently to minimize unnecessary expenses while maintaining compliance.
Conclusion
For multi-location retailers and franchise operators, FANF represents a significant but manageable cost of doing business. By understanding how merchant IDs, location counts, and consolidation strategies influence fees, businesses can take control of their obligations and prevent costs from spiraling out of control. While FANF is unavoidable, proactive planning ensures it becomes a predictable part of operations rather than a disruptive expense.
In 2025, as franchises expand and retailers continue to open new sites in New Castle and beyond, FANF will remain a central factor in financial planning. By choosing transparent processors, exploring consolidation, and modeling fees as part of growth strategies, multi-site merchants can maintain profitability while scaling. FANF is simply another piece of the payment puzzle—one that requires careful attention but offers opportunities for smarter management when approached with the right knowledge.