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If you buy $1 worth of goods from Amazon, you get $1 worth of value. The processing fee paid by Amazon in no way diminishes that.
If Amazon builds their card processing fees into their pricing - which they presumably do - consumers don't get $1 of value, they get value somewhere in the neighborhood of 98 cents.
The differing merchant fees affect Amazon's profitability, they don't result in one customer "receiving" money from another customer.
This is something that is pretty easy to "know for a fact."
While one consumer does not directly receive cash from other customers, there is a value in differential.
In order to be profitable, Amazon MUST bundle their costs - including card processing fees - into their pricing. So when a consumer spends $1 on Amazon they are really getting about 98 cents in value.
Differing prices for gasoline based on cash or credit purchase are rare these days, and happen in rather limited locations. It is certainly not the norm across the country.
Okay, I happen to live in one of those locations, so my perception is that is is the norm.
I ask not to be argumentative, but because this differs wildly from what I have observed.
I think the distribution "EBT users" is bimodal and dissimilar, hence an observer's perception is driven largely by which mode they are observing.
Probably the vast majority of EBT dollars are spent by parents (TANF, SNAP). Childless adults (seniors, disabled, bums) represent a large proportion of users but receive lower benefits on average.
It is likely that EBT spending by parents is largely driven by children and inherently wasteful. Unless hampered by substance abuse issues, childless adults probably are much more frugal and responsible with their EBT spending. Abusers are reckless and dangerous in their quest for a fix.
What I meant to say is that all "card processing fees" are funded by customers. Amazon makes more profit on my $N purchase than they make on a credit card user's equivalent $N purchase. I'm tired of getting inferior value for my dollar.
If you want to try to determine Amazon's margin in your latest pursuit of your victim high, you've got to take it further than just credit card processing fees. Some products have less (or possibly negative/no) margin on shipping, some have more costs with warehousing or handling, some might be higher margin products just by current market conditions, etc. you cannot just claim that someone using a credit card is getting more value unless they are ordering the same thing at the exact same time to the same address.
Of course this is all silly, the value of a product from a consumer's perspective has two variables: what is the product and how much did it cost.
Quote:
Originally Posted by freemkt
Hypothetical gas.
You know you've got a persecution complex when you're complaining about the injustice you experience in the purchase of a product that you don't even actually purchase.
If Amazon builds their card processing fees into their pricing - which they presumably do - consumers don't get $1 of value, they get value somewhere in the neighborhood of 98 cents.
I think you're thinking too much. lol.
If I buy from any other seller, the cost of CC processing i built into their overhead as well.
By going online with Amazon or any other, I avoid having to travel locally to buy. Surely more than 2 percent savings there.
If Amazon builds their card processing fees into their pricing - which they presumably do - consumers don't get $1 of value, they get value somewhere in the neighborhood of 98 cents.
Untrue. Value is created by the transaction. By definition, anyone who pays $1 for a good or service receives at least $1 of value. In most cases, they receive more than $1 of value -- this is called consumer surplus. There is also a producer surplus on the flip side of the transaction.
By definition, if a good only provides 98 cents of value to a consumer yet is priced at $1, no transaction will take place and no value will have been created.
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