Retailers can now charge credit card fees to customers . What's your opinion?
In case you haven't heard, 40 states can now charge a fee to customers when they use a credit card. I'm interested in your opinion of how this could effect your business and the industry a whole.
You can read the article here http://news.msn.com/us/new-credit-card-fee-hits-consumers-in-the-wa...
Replies to This Discussion
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Permalink Reply by Lindsey Doud on
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Our business will soon be adding a $0.25 charge for purchases less than $5. We have many customers that will make a $1.90 purchase with a card and then we pay a fee to process that card! It is so frusterating to watch what small profit you make on small items go the the card companies. So, from a business owner's perspective, it makes a lot of sense. We have to find ways to survive!
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Permalink Reply by Rob Morrisey on
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I have definitely been going through the credit card processing blues lately. I feel your pain Lindsey. A cup of iced tea or coffee gets charged and I fight the dirty looks. Most customers don't realize what we get charged or that we get charged at all!
To answer your question, I would love nothing more than to charge my customers to use their card. Isn't that how it should be?? Many years ago when I learned that WE had to pay for THEIR convenience I was blown away. But say you start charging your customers...does coffeehouse B less than a mile away charge theirs? You can see where I'm going with this. I think it's a great idea and it only seems fair that they should have to pay, but only in a perfect world.
Instead I'm moving on to using Square. They now have a new $275 flat rate fee. So no matter how big or small the ticket is, it's all the same at the end of the month. Plus they have very convenient POS features that make taking orders and training much easier. So do the other companies like SalesVu for example. I just decided on Sqare. Should be up and running in a few weeks.
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Permalink Reply by Jennifer Vaaler on
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Please keep us updated how this goes and how you go about handling upset customers.
Lindsey Doud said:Our business will soon be adding a $0.25 charge for purchases less than $5. We have many customers that will make a $1.90 purchase with a card and then we pay a fee to process that card! It is so frusterating to watch what small profit you make on small items go the the card companies. So, from a business owner's perspective, it makes a lot of sense. We have to find ways to survive!
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I'm curious to know if anyone here plans on implementing the fee. What about you Jennifer? It's a scary thought to the number of customers that will no longer come back out of anger. Most aren't concerned that use of their cards costs us money.
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Many shops in our town are doing the same, so I don't think it will have too large of a negative impact. Our plan is to post something on the register letting customers know about the change. Then a month or two down the road, when they have gotten used to the idea, we will actually start charging. I will have to look Square, though. That sounds like it might be an effective alternative!
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Permalink Reply by John P on
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Isn't it a better option to raise your prices once every 12 to 18 months to cover these kinds of fees and additional product costs. You can always hide these costs in your pricing rather than make credit card customers feel awkward.
We're going to change to Square as well. It will save us an avg of $200/month.
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Permalink Reply by Kathy Fadorsen on
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A note about square I looked at them at the BBB and they have lots of complaints about not funding sales after they reach a certian $'s for the month. They can withhold partial payment of these funds. Also there where compalints that you have no way to reach them if you have a problem they give you and email address but can sometime take days to respond. I know Jack Groot has been using this service for a while and I would be interested to know if he was having any problems.
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I can't remember the exact detail right now, but they only hold the money on charges over $2100 I think it is. This obviously doesn't concern me (I wish I was charging over 2100!!). Also, yes there have been a large number of complaints. Most are about holding the money for 30 days (which again is no concern) and the other is customer service. The thing is, as with everything in life, you get what you pay for. They are able to keep costs of processing so cheap because they don't have a lot of overhead (a large staff running phone lines, emails, etc). If they hired a force of workers then they'd obviously have to raise processing fees. I'm fine with this. In the 7 years of my business I almost never had to call my processor. Hopefully that continues with Square. We'll see as I haven't started yet.
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I'm in the middle of updating my menu before I even before this article. At first I was thinking about charging extra, but now, I'm thinking about adjusting prices accordingly. Still unsure.
I have been using square more on my phone (Android) and seriously thinking about switching over to Square register too. So far, I've had no problems with processing.
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