With the holiday retail season upon us, millions of retailers are experiencing a similar scenario. Technology has created new opportunities to enhance service, speed and product offerings while significantly lowering prices. While lowering our prices, we pay more in interchange fees, which translates into a $30 billion annual hidden tax on retailers and consumers.
The below two examples can parallel similar experiences from other retailers in many other industries too. Next month, we will be addessing technology issues at the International Consumer Electronics Show in Las Vegas.
$5.00 PHOTO SCANNING NOW JUST 5-CENTS
At 30 Minute Photos Etc., we charged $5.00 to scan a picture; today it is as low as 5-cents - pay just $49.95 to scan a shoe box of photos (up to 1,000 snapshots) and the orders are completed in minutes. After a Popular Photography article on our business (July, 2006, "Scanning made cheap and easy - Got Prints?"), orders are now mailed from across the country or literally wheeled into our retail store in Orange County, Calif. One customer brought in 19,000 pictures on a Saturday and picked it up Monday morning. That is technology and efficiency for you!
PHOTO GREETING CARDS ARE READY IN MINUTES AND COSTS A FRACTION OF THE LABOR AND PRICE FROM JUST A FEW YEARS AGO
Another example of how technology has created new opportunities for retailers and saved money and hassles for consumers are holiday photo greeting cards. In 1990, when we founded the company, we had nearly a 50% waste ratio to design and prepare a photo greeting card. Orders were ready a few days later and the cost was about 5 times today's rate. Today, with orders coming in from across the country and at retail on our photo kiosks, the wait time is minutes. The waste factor is zero - unless someone misspells a name on the card. The quality from 16-years ago to today is embarrassing; back then, there was a huge error rate - today, every order is extraordinary.
With completed orders being mailed back nationwide within minutes, the price is also something to note. Today the photo greeting cards are as low as 38-cents.
Partly because we provide special services to military families, this is among our customers' most popular photo greeting card designs this year.
[Holiday Photo Greeting Card Sample from 30 Minute Photos Etc.]
This posting is not designed to be commercial, but informative and explain how technology is speeding up everything and lowering the costs .... except seemingly for merchant interchange rates. Keep in mind, our business is not part of a giant cartel with 80% market power and unbridled control. We have lots of competition, and while we use technology to create new efficiencies, products and lower prices, the credit card associations are continuing to raise rates. While they just announced a planned 60% reduction for debit card use in 2008 overseas, our rates regularly climb.
If technology is helping to lower the costs of business, why are the card associations continuing to raise their rates while also adding new schemes to force merchants to pay more.