Is it greed for a merchant to cover card fees?
The only place I see where a crddit card charge will increase the total price of the transaction is in the firearms business.
Is it greedy for such a low markup business to cover the expense/
if a dealer is offering guns at cost plus 5% and then has to pay a 3% fee if the sale is through credit card?
Is it greedy for such a low markup business to cover the expense/
if a dealer is offering guns at cost plus 5% and then has to pay a 3% fee if the sale is through credit card?
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since even gas stations no longer have a cash/credit price, my suggestion is to have the price as posted as the price...unless you pay by postal money order/certified check, then offer those customers a 3% discount.
NO other business I know does this besides guns, espicially at auction sites. Since most people like using their plastic ( and that includes debit cards are counted as a "credit card" by a lot of folks)why not figure the 3% in the cost, and again, if someone pays cash, give them a break0 -
We do in our business for big items. The price given is for cash. If you want to use a Credit Card, we pass on the fees to you. We sell Lawn and Garden Equip. 0 -
quote:Originally posted by MVP
The only place I see where a crddit card charge will increase the total price of the transaction is in the firearms business.
Is it greedy for such a low markup business to cover the expense/
if a dealer is offering guns at cost plus 5% and then has to pay a 3% fee if the sale is through credit card?
No it's not greed. We start our on line auctions at cost...and I cannot afford to sell an item for 3% below cost. I don't have a very large mark up on my guns...and all my prices reflect a 3% cash discount. One thing you can do is to encourage in store customers to use their ATM cards...there is only a per transaction fee for ATM transactions...no percentage.0 -
I agree with the PB&J guy. Particularly on line, use of a credit card makes great sense for safety and speed of payment. You cannot insure a money order and if it is lost, so is your money. In many cases I don't mind paying the extra for the ease and security, but if the price reflected that at the outset a discount for cash customers simply looks like better marketing. 0 -
The profit margin for most firearm dealers is actually pretty slim. The inability to recoup CC fees could make it a waste of time to sell guns. It's his FFL. If you don't like it then move on to someone who charges the same price but doesn't charge a CC fee. 0 -
Most gun dealers are not the size of say Dicks, Walmart, etc. Those places sell enough to not care about credit card fees or in the case of Walmart tell the credit card company that they will not accept fees.
The small dealer doesn't have that purchasing power.0 -
I'll have to do a little research into this again, but I think your merchant account can be terminated for charging a transaction fee for credit card purchases. I understand perfectly well why people operate this way, but it is most likely in the fine print of the agreement you sign.
With that said, most of the people I've mentioned this to have said that they'll just continue until they get caught.0 -
LOL I worded my original question wrong.
I personally don't have a problem with a 3% discounted cash price for a firearm because I know that at 3% you have almost lost any profit in a new firearm.0 -
quote:Originally posted by agman1999
I'll have to do a little research into this again, but I think your merchant account can be terminated for charging a transaction fee for credit card purchases. I understand perfectly well why people operate this way, but it is most likely in the fine print of the agreement you sign.
With that said, most of the people I've mentioned this to have said that they'll just continue until they get caught.
Alas, that rule, like immigration laws, are widley ignored and an acceptable form of business practice. Visa and MC both prohibit merchants from UP CHARGING for using the card, but who cares. Credit cards are BAD. Nobody I ever met went to the mail and yelled THANK the LORD, MY VISA BILL CAME TODAY!!!!!.0 -
I think they should be able to recoup the fees. Whenever I list anything on an auction site I always include terms that state that if the person uses a credit card the final auction price will be increased by 3%. This is only applicable to eBay for me since PayPal is the only way I can take cards.
My reasoning is this way. In an auction when you bid the amount of the bid is the amount of money you are promising to pay me. If you choose to make that payment using a credit card for your own convenience why should I have to take less in my pocket than the final bid price? The person benefiting from the convenience of using the card should pay for it.
Another way to look at it in an auction format is let's say someone wins my auction with a bid of $100, outbidding the next lowest bid by $1. If the person that would have paid $99 was going to pay cash then I would get all $99. If the person that won at $100 decides to use their credit card I get $97, but the person would not have won the auction with a bit of $97.0 -
Excellent points wuchak 0 -
quote:Originally posted by He Dog
I agree with the PB&J guy. Particularly on line, use of a credit card makes great sense for safety and speed of payment. You cannot insure a money order and if it is lost, so is your money. In many cases I don't mind paying the extra for the ease and security, but if the price reflected that at the outset a discount for cash customers simply looks like better marketing.
Actually if a USPS money order is lost you have to wait 30days after the date it was issued. Then can submit a form saying you want them to trace the MO and return the money to you, had to do this once.0 -
Ya, Its the same way in the appliance bussiness.
Very minimal markup and people expect you to eat the credit card fees also[V]0 -
if you don't want to pay the fee don't take plastic, when you chose to accept credit cards the fee was no secret, i have never paid a few except to one gun shop, and i paid it voluntarily i was not even asked, but knowing the cost/mark up of the gun i couldn't in good conscious make him pay the fee 0 -
This is common practice within the industry and is perfectly legal...provided you are offering a "Cash Discounted Price" and not a price increase for credit. Most wholesalers also charge dealers a 3% mark up for credit card purchases. It's not just the consumer that pays these fees. The merchants also have a per transaction fee and batchout fees, on top of the percentage. A merchant cannot stay in business if they are not earning a profit... 0 -
If merchants don't get to recoup their cost of doing business they will go out of business. It's that way in firearms, clocks, dishes, and everything else. The online auction business is very competitive, and it just makes more sense to show a lower cash price plus additional CC fee so you will see exactly what you are getting. The alternative would be to increase all prices and offer a cash discount, the difference being buyers may choose to look at a $500 auction instead of a $515 auction for the same item. 0 -
Most merchants I know raise prices to cover this cost. So we all pay for it regardless if you pay bt CC, cash, check or ETC.
Lance0 -
quote:Originally posted by non mortuus
quote:Originally posted by He Dog
I agree with the PB&J guy. Particularly on line, use of a credit card makes great sense for safety and speed of payment. You cannot insure a money order and if it is lost, so is your money. In many cases I don't mind paying the extra for the ease and security, but if the price reflected that at the outset a discount for cash customers simply looks like better marketing.
Actually if a USPS money order is lost you have to wait 30days after the date it was issued. Then can submit a form saying you want them to trace the MO and return the money to you, had to do this once.
yeah, this happened to me too.
If you ship your M.O. Priority Mail with delivery confirmation, the USPS will replace the M.O. promptly if it gets lost. It's worth the extra 5 bucks or so (think of it as a credit card fee[;)]).0 -
In Michigan one of the large pizza companies did the same thing. They advertised the cash price and tacked on the credit car fee at the time of purchase. The AG determined that it was illegal. The pizza places had to charge equal prices cash or credit, or list the higher price and state a discount would apply. They could not list the cash price and mark up to the credit price. Therefore such a transactions would be illegal in MI. 0 -
Not sure if it greed, just wrong. 0 -
To me it makes more sense to set the price to include the added 3% for cc, and make note of the fact you five a discount for cash purchases. Tha way people feel like they are getting a deal for using cash, rather than thinking they are getting screwed for using a credit card. 0 -
What is it with the running feeling of entitlement in this thread that others should pay for your convenience if you want to use a credit card? How is this any different than the welfare mother insisting that someone else should pay for her baby?
The biggest problem I have with the fees is the ridiculous amount they charge plus the fact that it's tied to a percentage instead of a flat fee. Do their computers really work 3x as hard for a $300 sale as a $100 one? There is no justification to the increase in cost.0 -
quote:Originally posted by ECC
This is common practice within the industry and is perfectly legal...provided you are offering a "Cash Discounted Price" and not a price increase for credit. Most wholesalers also charge dealers a 3% mark up for credit card purchases. It's not just the consumer that pays these fees. The merchants also have a per transaction fee and batchout fees, on top of the percentage. A merchant cannot stay in business if they are not earning a profit...
You are not offering a cash discount on your auctions. You state
that the buyer must add 3% to final bid price for cc purchase. A true cash discount would be 3% less than the final bid price.0
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