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Originally posted by a1abdj:

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This is really no different than the exorbitant shipping fees you see with some companies. $12.99 or flat $15.00 for example.

I think it's the exact opposite of that. In your example a package that costs $2 to ship is being billed $15. We won't need to get into the "handling" portion at all. Your example is "overcharging" every customer whos shipping actually costs less than $15 to ship. Fair point.

In the case of companies factoring in the overhead of credit cards across the board, they are overcharging every single customer that pays with a cash or check, no? Those customers do not result in a fee for which they are including within their price.

By making it a line item charge they are A) offering a choice to the consumer, and B) only charging those who result in that portion of the overhead. Doesn't get much more honest or fair than that.

I've wondered how much, if any, sales would drop in our credit driven society if CC didn't exist? Certainly there is a cost but there are also benefits of getting business you might not otherwise receive. And why do some stores thrive and not charge? That being said, I was in the service industry and never had to charge sales tax. Maybe my tune would be different if I were in your shoes.

There's one restaurant in town that advertises a 10% discount if paying by cash. I pay by credit card everywhere but for a 10% discount, I'll pay cash.

I don't like the other way when they charge me more for paying by credit card.

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Originally posted by BB61:
I've wondered how much, if any, sales would drop in our credit driven society if CC didn't exist? Certainly there is a cost but there are also benefits of getting business you might not otherwise receive. And why do some stores thrive and not charge?

Good questions.

As a whole, not maintaining merchant accounts, not leasing or purchasing equipment to process payments, and not having to pad pricing to account for chargebacks and fraud certainly affect the bottom line profit margin. As correctly pointed out earlier in this thread, no smart business person exists for any length of time eating losses. Despite what many people believe, most businesses will not eat a loss. I know I won't. I was recently approached by American Express and offered 2 years free merchant account with 1.9% processing. Anyone who's ever accepted AMEX knows that's a steal of a deal. I took a poll with my customers for 2 months and asked my regular clients if anyone would prefer to pay with AMEX. Not a single person expressed that desire, in fact the only person who has ever needed to pay with an expense card wanted to use a discover and the total charge was only going to be $300. It was an albatross, and I just had them stick a check in the mail and trusted them to get me the money before I delivered the final product. Retail and hospitality seem to be the largest users of CCs.

There is also the issue of paying cash so there is not a clear paper trail. Working off the books is huge in this country. The IRS has gotten a bit better in ferreting this out as they have figures of how much people make in certain professions such as Taxi Driver, construction worker etc.

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Originally posted by rtquig:
I haven't yet seen it at a restaurant, but lately gas stations have been giving two price quotes on their signs. I haven't see this in over 20 years before this.

They have been doing that here for several years . Usually amounts to about 5 cents / gal .

I hope the ones charging 3% or whatever for a CC aren't the same ones with a sign that they don't have any change because of a bullshit national coin shortage.

My fav wing restaurant has a .30 cents each transaction plus another charge depending on price if above &35 and not a cash transaction. I pay it. I hope they stay in business.

There's a hole-in-the-wall (almost a kiosk) place near me that makes pan-fried chicken that is fantastic. They only deal in cash, so I seldom go there. I rarely have more than a couple of Dollars cash in my wallet.

My barber also is cash-only. For him I get some money from the local convenience store as cash back just before getting a cut.

flashguy

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Originally posted by ZSMICHAEL:
There is also the issue of paying cash so there is not a clear paper trail. Working off the books is huge in this country. The IRS has gotten a bit better in ferreting this out as they have figures of how much people make in certain professions such as Taxi Driver, construction worker etc.

That is eactly what the government is trying to do:ELIMINATE CASH

Once that is done ALL transactions can be tracked. Guns will be followed easily. No cash hurts the dope trade and the illegal sex business. It will make it harder for terrorist cells to exist here.
It will also shut down lemonade stands, prevent kids from mowing your lawn or shoveling your snow. If any such kids exist anymore.
It will also mean the government won't have to print money or make coins which is expensive.

All kinds of pros & cons to the subject.

Does this mean I can tip less if I pay cash?

Old news in a way.

Wife's van got hit, gee, ten years ago, body shop offered a cash price instead of CC. Substantial discount which prompted me to carry that day.

Same for gun shows, flea markets etc. Some places had a restriction on purchases less than $XX if on a CC which was in effect a ban on using it. They relented slightly after the laws were changed and now charge the CC extra.

This has been going on a long time now.

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Does this mean I can tip less if I pay cash?

That's another great point that many don't consider.

That restaurant is paying 3% (to put an even number on it) for the entire charge. Your meal? 3%. Sales tax? 3%. The tip you leave? 3%.

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Originally posted by ElToro:
I never saw that before I moved to FL seems every restaurant here has that on the bill. It rubs me the wrong way that it’s not disclosed on the menu up front but dropped on you at the end. I know to expect it now.

Interesting - We spent the last 4 winters in Destin and never saw this once.

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Originally posted by Graniteguy:
Does this mean I can tip less if I pay cash?

Yes, you base the tip off the cash price and leave your tip in cash. Win win for everyone.

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I've wondered how much, if any, sales would drop in our credit driven society if CC didn't exist? Certainly there is a cost but there are also benefits of getting business you might not otherwise receive. And why do some stores thrive and not charge? That being said, I was in the service industry and never had to charge sales tax. Maybe my tune would be different if I were in your shoes.

It's a well established statistic that people spend more when paying with the convenience of a credit card rather than hard cash out of the wallet or a paper check. So these days it is not practical for most merchants to accept only cash. CC fees merchants see is just another business cost. When we started taking CCs back in the early 90's, our fee was 2% - 1.25%. I don't know what the current favored rate is, but I'm thinking it's less than the 3% some places are charging. What if a restaurant wanted to pass on their expenses for A/C and heating because their rates went up and roped off a section that was heated and cooled, and charged 3% more to sit there? I see it as the same sort of thing. Your taking what is now the most favored form of payment and punishing customers for using it.

I don't think I've seen it at a restaurant around here yet, but we don't actually go out to eat that much unless traveling. A few small businesses we use add a surcharge for using a credit card. The most recent one is our dog groomer. Their published price list has the "cash discount" prices. If you pay with a card, they add 2.56%. It seems fair to me. I normally try to pay cash at small family-owned places that I like since I know the credit card fees eat into their profits. At larger places, I don't care.

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Your taking what is now the most favored form of payment and punishing customers for using it.

You use it for convenience, so the government was the first to accurately nail it as a "convenience fee".

It's not to punish you, it's to prevent us from being punished. If it cost me nothing to accept a credit card I'd take them all day long and in any amount.

You mentioned the increased cost of utilities. That doesn't exactly apply to me, but fuel prices do. That's why you'll also see a fuel surcharge on my receipts. Along with that, what you won't see is the fuel surcharge factored into items I ship, as we just put that all into one amount labeled shipping or freight. But that price changes on a daily basis, and you are charged whatever it is that day.

For many years, Texas law did not allow passing on a credit card fee. But some retailers offered a "cash discount" which was compliant with the statute, but accomplished the same thing. Now the law is changed, and merchants can charge the fee explicitly.

But I think it is silly for most retailers to do so, and bad customer relations. Many, if not most, customers want to pay with cards, either for convenience or for credit card points, so just build the credit card fee into your pricing structure. It is, after all, part of the price of doing business. To me it would be like a grocer who gave you a bill that was:

$3.00 Chicken
00.80 Building use fee
00.85 Employee fee
00.20 Utility fee
00.02 Credit card fee
$4.87 Total

I don't care what your cost structure is.

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Originally posted by Tirod:
Old news in a way.

Wife's van got hit, gee, ten years ago, body shop offered a cash price instead of CC. Substantial discount which prompted me to carry that day.

Same for gun shows, flea markets etc. Some places had a restriction on purchases less than $XX if on a CC which was in effect a ban on using it. They relented slightly after the laws were changed and now charge the CC extra.

This has been going on a long time now.

Some of that is driven by a desire to cheat the IRS. Cash is hard for the service to track down.

^^^^^^^^^^^^^
Does your firm accept CC?