It wasn't just our presence at CES that drew cheers from entrepreneurial supporters, just today we heard from another important customer. A very sweet lady brought in a photograph to be restored and then explained how much she has enjoyed reading about our many years of civic activism and appreciation for our role as class representative in the merchant interchange battle against Visa® and MasterCard®.
Her own experiences were consequential and added more fuel to our quest because she is a franchisee - owning several fast food restaurants with one of the world's largest chains. According to her, the average sale at her company is about $3.50 and she is now forced to accept all major credit cards. Some key points from our discussion were that the availability of credit cards have led to no appreciable increase in sales and she had to hire an extra bookkeeper just to track all the statements and charges from the card associations. She seemed very connected to the fast food restaurant industry and mentioned that it is not just her, but other franchisees and owners who cannot tolerate the cards; it is too costly. Her staff is trained to ask if it is a debit or credit card, but often she is forced to pay the higher signature card rates anyway.
She explained the acceptance of credit cards are much like "green fees" at a golf club; it is something that they have to pay but provides little benefit, especially because most patrons are spending just a few dollars and have cash anyway. While Visa and MasterCard will challenge these statistics, take it from a franchisee owner who knows her market and business.
But, it is not just fast food, as she mentioned that a local service station is regularly accepting charge cards for items as small as a pack of gum. Take a look at today's Wachovia and Bank of America quarterly results if you want more insights into just how profitable interchange fees are.
[Source: WayTooHigh.com]
