Quote:
Originally Posted by bxlefty23
they are losing money when people pay with credit cards
what is the point of making a sale that loses you money?
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They do for a few reasons--customer convenience, fleet sales, and if they are a franchisee they have too
When gas wasnt as expensive it wasnt so bad for these dealers because they are charged a fixed percentage(BTW Amex charges the most) of the sale, so it the dealer is making 5-15 cents a gallon they can afford it more easily, for example
Car pumps 10 gallons at $1.19
Total gross sale=$11.90
Dealer makes 1.50 (based on .15 margin)cents profit before CC fee
Credit Card fee .59 cents (5% fee)
total net profit .91
Car pumps 10 gallons at 4.19
Total gross sale= $41.90
Dealer makes $1.50 cents profit before CC fee
Credit Card fee 2.095
total net profit -.595
most gas stations dont make alot of profit on gasoline, the bulk of the profit comes from inside sales (store--soda, chips, etc), most margins run anywhere from 15%-75%(75% in case of fountain soda and coffee). But if the street price for gasoline is too high you will see the store sales drop because most of purchases made at a c-store/gas station are impulse sales.