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Old 12-17-2018, 01:36 PM
 
953 posts, read 1,072,489 times
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Do big box stores have contracts with visa/MC/discover/Amex for flat processing fees? I know they negotiate a better deal than your typical small business.

I know many small businesses only take cash because they say the fees are too much when most of their transactions are very small. Just looking online square charges 2.9% +30c or 3.9% +15c.

Today I visited staples to make a single copy. I normally buy a card and load it with a couple dollars and make some copies. Today I only needed 1 copy and it appears they've gone away from staples copy cards and they have a credit card swipe at the copiers. I made a purchase of 12 cents. Do they make any money off of that?
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Old 01-23-2019, 02:11 AM
 
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No, I think they will lose a few cents from that, but they are a large enough business that it wouldn't matter.
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Old 01-23-2019, 02:44 AM
 
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Quote:
Originally Posted by UntilTheNDofTimE View Post
Do big box stores have contracts with visa/MC/discover/Amex for flat processing fees? I know they negotiate a better deal than your typical small business.

I know many small businesses only take cash because they say the fees are too much when most of their transactions are very small. Just looking online square charges 2.9% +30c or 3.9% +15c.

Today I visited staples to make a single copy. I normally buy a card and load it with a couple dollars and make some copies. Today I only needed 1 copy and it appears they've gone away from staples copy cards and they have a credit card swipe at the copiers. I made a purchase of 12 cents. Do they make any money off of that?
Many small "mom and pop" along with other places would have a cow if you tried to charge something that small. Many now have minimums for CC purchases anyway.


OTOH has noted places like Kinkos, Staples and others who do a large volume of "nickel and dime" transactions though losing money on each the sum of whole is positive.


Think how many copy transactions a Staples or Kinkos does in a weekly, monthly or quarterly period, little by little it adds up.


Many consumers don't like captive money "cards"; and if possible will use their CC or debit card instead.


One large gripe is the things often aren't refundable and or if lost you can kiss that money good-bye.


Stores are moving to pure CC/debit card acceptance as it helps reduce amount of cash transactions (and all that such things entails). This not only reduces theft actual or risk (employee or otherwise), but streamlines accounting, and reduces need for bank deposit drops.
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Old 01-23-2019, 02:45 AM
 
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Here is two parts that are true.
The major processors (clearing houses)of credit card processing get the 2-4% profit charged the merchant. Not necessarily the logo marketed name: vis/Mc, American express.
The merchant though rarely shares that it gets a nice kickback from the logo'd market for participating in electronic charge/debits. Some promos are market geared. Such as they might target retail stores...that if they do 1 million in credit sales to visa ..they get a spiff of xyz ...
The store "branded" cards are also another way merchants bring in more revenue on the back end.
Business ...no matter what level are smart enough on how to profit. Telling the avg Joe that they pay a 2-4% is a partial truth. They simply cloak the other side of the coin on the spiff and promo funds received.
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Old 01-23-2019, 12:17 PM
 
Location: Aurora Denveralis
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Yes, the bigger the merchant, the more likely they have shopped merchant providers and banks and have arm-wrestled all the credit card costs down to a minimum. Smaller merchants pay more because they don't have this leverage, and, on a transaction basis, cost more to process.

Visa and MasterCard don't issue cards, handle transactions or involve themselves in much if any of the actual monetary process. They (and, AFAIK, Discover and Amex as well) are relatively small companies that manage the branding, advertising, licensing and processing control for the banks who actually issue and manage the accounts.
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Old 01-23-2019, 12:33 PM
 
23,366 posts, read 16,089,743 times
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Quote:
Originally Posted by Quietude View Post
Yes, the bigger the merchant, the more likely they have shopped merchant providers and banks and have arm-wrestled all the credit card costs down to a minimum. Smaller merchants pay more because they don't have this leverage, and, on a transaction basis, cost more to process.

Visa and MasterCard don't issue cards, handle transactions or involve themselves in much if any of the actual monetary process. They (and, AFAIK, Discover and Amex as well) are relatively small companies that manage the branding, advertising, licensing and processing control for the banks who actually issue and manage the accounts.


AMEX is a bank holding company, and thus handles all of its card transaction via own network.


https://en.wikipedia.org/wiki/American_Express


This is why among other things AMEX now offers personal (debt consolation) loans and other financial services.
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Old 01-23-2019, 12:35 PM
 
Location: Aurora Denveralis
8,717 posts, read 3,923,077 times
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Quote:
Originally Posted by BugsyPal View Post
AMEX is a bank holding company, and thus handles all of its card transaction via own network.
Thanks. I was pretty sure that was the case but didn't care to commit either way.

Which is part of the reason, though, that they are a more costly card to merchants and had a long period (which might still exist in some places) of being rejected and disliked by lower- and mid-tier merchants who didn't have product margins to compensate.
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