Retailers point of view

planteria

jo-bo wrote: »

Just a quickie...why should I have to wait for my money?
I've given you a service and I'd like paying now!

i am not saying you should. and my comments, you might notice, are based upon spending time on both sides of the counter. in the past 48hours i have taken cash that'll be in the bank this morning, taken Visa and Mastercard payments that'll be in the bank tomorrow (tuesday) morning and at least one Amex payment that will be in the bank on tuesday, and i have spend on my Amex and Visa and generated cashback in the process. it's all just part of the system.

in theory, i could have said to Dave, who bought from us using his Amex cashback card: 'if you go to the bank & come back with cash, i'll give you 2% off' (ie. more than his cashback rate, i guess)....but would he have gone for that? doubt it. and the benefit to our business would have been a full payment rather than a payment arriving with fee deducted, and our money cleared in the bank 3 days earlier. is that worth it?

we get lots of people who pay cash. we get more who pay by debit/Master/Visacredit card. and we get some who pay by Amex. we take all of their money, happily.

aleph_0

Re chattychappy's post: It's probably a combination of things. For many small businesses, cash still has essentially no effective handling fee, since it goes out again. Initially, I expect supermarkets still had cash going out - e.g. wages, local suppliers. Now, almost all cash will have to be sent to the bank (I'd guess the biggest cash out flow would be through debit card 'cashback'). I'm speculating, but I wonder if the effective cost (security, transportation, loss) of cash is comparable to CC fees now.

I think you're right - supermarkets realised the power of the credit card in encouraging more spend. They were also in a position to negotiate good fees, since they didn't 'need' the credit cards. Eventually M&S/John Lewis had to give in, since too many potential customers were living/buying on credit. They had to give in to the change in public attitude, where credit/debt was now seen as perfectly normal (of course we know that spending on CC and paying off isn't real debt).

chattychappy

aleph_0 wrote: »

Re chattychappy's post: It's probably a combination of things. For many small businesses, cash still has essentially no effective handling fee, since it goes out again.

I used to go to a delightful Sri Lankan restuarant that had cash flow problems. You'd sit down and place your order. A few moments later you'd see the bloke hurry out to a nearby supermarket to get ingredients.

One time my mate ordered an expensive bottle of wine. We got an uncomfortable look. I suggested that we could pay a "deposit" if it would help. We produced twenty quid which the bloke gratefully received. Minutes later he was back with an Unwins bag and wine was served.

simongregson

If I can sell enough extra to cover the costs of accepting credit cards by not limiting customers to how much cash is in their pocket then it is worth swallowing the fee.


The fact that most shops and restaurants in the UK accept credit cards would suggest that this is the case on average, after all if they thought they would make more profit by not accepting them then they wouldn't. On average when businesses that rely on impulse decisions start accepting cards, they increase sales.

Morglin

congaman wrote: »

You got to remember that these card companies make most of their money out of the retailers who accept the card through transaction charges, not from interest from late payers. Retailers often pay up to 2.5% on your transaction. Just cut up your credit card and use debit instead and stop lining the pockets parasitical bankers. In the long run it will reduce costs for us all.

Why would I want to stop using something I actually make money on? :huh:


Extended interest free on purchases, and cashback. Minimum payment made every month. Card settled and account closed when interest free runs out, and then do the same with a different card, been doing it for ages, and I have never paid the CC companies a penny in interest.:j Plus, I get the 'bonus' of the cashback paid by them to me.


It sort of makes up for the pitiful amount of interest they pay me on my investments and savings!


I don't use shops or restaurants that don't take cards, so Aldi's etc., don't get my trade - simple.


Lin

jo-bo

Morglin wrote: »

Why would I want to stop using something I actually make money on? :huh:


Extended interest free on purchases, and cashback. Minimum payment made every month. Card settled and account closed when interest free runs out, and then do the same with a different card, been doing it for ages, and I have never paid the CC companies a penny in interest.:j Plus, I get the 'bonus' of the cashback paid by them to me.


It sort of makes up for the pitiful amount of interest they pay me on my investments and savings!


I don't use shops or restaurants that don't take cards, so Aldi's etc., don't get my trade - simple.


Lin

Have you bothered to read the rest of the thread?!?!

chattychappy

Morglin wrote: »

Extended interest free on purchases, and cashback. Minimum payment made every month. Card settled and account closed when interest free runs out, and then do the same with a different card, been doing it for ages, and I have never paid the CC companies a penny in interest.:j Plus, I get the 'bonus' of the cashback paid by them to me.


It sort of makes up for the pitiful amount of interest they pay me on my investments and savings!

Surely the reverse is true. This clever maximising of interest free periods on debt would be more valuable if you could be earning high rates in savings accounts in the meantime.

Since you are only getting "pitiful" interest... your not really making much out of it!

planteria

a very fair point. but i have used stoozed money very profitably over the years. in the current environment, money is cheap (when you can get it) but making it pay requires at least some level of risk.