I know Stripe has a theoretical limit above this; however I'm concerned that credit card companies will often trigger alarms for such high charges.
What are the most common ways to collect big, yearly contracts? Paper checks? Stripe? Some sort of bank transfer API?
Yep, at least in the US, paper checks for some (still!) and wire transfer for others. You send them an invoice, and they send you an (actual, paper) check or make a wire payment to the account number you put in the invoice. Both should be pretty much free, if you have a decent bank (although some banks will charge a few dollars now for incoming domestic wire transfers).
I think for a yearly charge of $10,000+, it's probably worth the pain in the ass factor to invoice the charge, particularly given how much you'll save (about $300 if you use Stripe, more for others, assuming 10,000 charge). Most banks have banking apps now that let you cash checks using the app, so if you really get going with 10,000 checks flowing in by the batch, you can hire some one to help deposit them via app or dropping them by a bank branch. Not a bad problem to have, if it happens.
Just realize that most companies operate on 60 or 90 day terms, and some even more. You can often negotiate for 30-day terms if they really like you/your product and you're firm about it. Just be sure you factor this into your cash flow. And have a process in place for what to do if you don't receive payment by then.
Actually, regarding Stripe, and I may be wrong about this, but I don't think most companies will let you set up a recurrent yearly credit card payment of 10,000 dollars, at least not without going high up the corporate food chain. If that's the case, you'd need to break it into a monthly charge to go the Stripe option.
A $10k invoice will often require your point of contact to open an internal Purchase Order (PO) with their finance department. If your contact doesn't make purchases often, it's really easy for them to miscommunicate internal requirements to get you paid on time, causing additional delays on top of your 60/90 terms. I strongly recommend asking your point of contact to connect you with their finance teams to confirm requirements before the software is delivered.
All companies have different requirements to pay vendors, with larger companies having longer, more convoluted internal processes. Clarifying the process to get you paid before you deliver the software pays dividends down the road by minimizing your time collecting late payments, 10x so if you are a solo founder or small team with more important tasks to focus on.
Better yet, do as the parent comment recommends and try to make a contact with Accounts Payable to begin with (although that's not always possible, depends on company).
Stripe can help you with doing ACH programmatically, if you want to offer an online payment option: https://support.stripe.com/questions/accepting-ach-payments-...
There are a few reasons transactions of this size are almost never done by credit card:
* Cost ($300 for CC, $0.25-$5 for ACH, free for checks)
* Fraud risk: Someone buys your product with a stolen card or without their boss's permission, they can reverse the charge and you have little to no recourse.
* Chargeback rate risk: You need to have less than 1% of your processing volume be reversed to accept major credit cards. With large transactions, a single reversal can put you over the limit.
* Large tickets, and annual billing, are both red flags when underwriting a business for credit card processing.
A business with very large transactions is risky to take on for the merchant account provider, so you may not be able to find one, may not get reasonable processing rates, may be subject to risk reserves that create cashflow issues, etc.
If you go bankrupt and don't fulfill your contract to 20 clients, and all 20 charge back their payment to you, it's the merchant account provider that's now lost $200K they can't recoup. They don't want that.
If you have a major outage and 10 clients charge back their payments, a processor needs $10 million in good charges to balance that $100K in bad charges from you just to stay below their mandated 1% chargeback rate by Visa/MC. That's too much to ask of many local banks and other MAPs.
Also there's an API and integrations with Wordpress and Magento. Price is a fixed $1/Check. No percentages!
Disclaimer: I work for checkbook.io