AMEX not accepted or surcharge

[edman]

Re: AMEX not accepted or surchage

Never mind the TPA, but under the rules that allow sucharging, the RBA left it up to the acquirers (the banks/Amex) to enforce limitations on how much a merchant can surcharge. So, I would say, under the framework that the RBA devised, it is the entirely appropriate mechanism for Amex to use.

If the Amex merchant rate is the same as the Visa/MC rate, then it seems a reasonable restriction for Amex to impose.

I got that offer too but after 3 years it was to go back to the original rate.

 

[WA flyer]

Re: AMEX not accepted or surchage

The Audi dealership is charging me 2.75% as that is APPARENTLY their Amex surcharge. Normally they don't charge for payments up to $5,000 but as I want to pay for the whole car on Amex we agreed that I would cover the surcharge.

I am sure a major car dealership and Audi, could hassle Amex and get their surcharge down to 1.5% or lower which is what Amex do charge some merchants now!

Tell them your considering a Fiat with 100k velocity points

 

[JohnK]

Re: AMEX not accepted or surchage

Should the customer pay ? well thats a good question, i guess the retailer has to make the value judgment, do they get same or better value from AX customer or does it really cost them. Even so 1% is not what people complain about, its the 3%-6% that is more than liley well over the cost of providing service.

Many a retailer have lost my business because they do not accept Amex or have a surcharge in place. I have only paid a surcharge if I have no other option to purchase.

In case some retailer does not quite understand the calculation let's see if I can help them out. I want to purchase $1,000 worth of goods of which I am assuming the retailer makes ~$220 working on ~30% margin and the retailer wants to put a 3% surcharge for me to use Amex which means I need to pay an extra $30. OK the customer, me, is definitely not happy so no sale.

The sensible thing for the retailer would be to accept my Amex without surcharge and their profit reduces to ~$190 but it is still a profit. Since the retailer persevered with surcharge I go off to another retailer that will accept Amex without surcharge and I will happily pay $1,030 for the same goods.

Moral of the story is any profit is much better than no profit and having the goods sit on the shop floor longer....

 

[Chicken]

Re: AMEX not accepted or surchage

Moral of the story is any profit is much better than no profit and having the goods sit on the shop floor longer....

Your calculation only works on some cases, but doesn't work in other cases.

Our company used to pay 2.7% for AmEx and Diners, while Visa was 0.8%

If some business who sells low margin products, like Metcard / TravelPass, or computer products, which is probably only about $100.

A Visa / MasterCard sale means losing 80c. A AmEx sell means losing $2.7. They probably only makes $3 or $5 on that $100. Now, isn't it better to have a common understand between all newsagencies / computer shops, to not take AmEx or surcharge it?

And your theory of a sale is better than stock sitting at the floor would not apply either. If I am a shop, and you tell me to cope the $2.7 and only make $2.3 off your sale (instead of $5), I know I will tell you where to go.

I just hope that cardholders also understands from the merchant point of view.

 

[Flashback]

Re: AMEX not accepted or surchage

Many a retailer have lost my business because they do not accept Amex or have a surcharge in place. I have only paid a surcharge if I have no other option to purchase.

In case some retailer does not quite understand the calculation let's see if I can help them out. I want to purchase $1,000 worth of goods of which I am assuming the retailer makes ~$220 working on ~30% margin and the retailer wants to put a 3% surcharge for me to use Amex which means I need to pay an extra $30. OK the customer, me, is definitely not happy so no sale.

The sensible thing for the retailer would be to accept my Amex without surcharge and their profit reduces to ~$190 but it is still a profit. Since the retailer persevered with surcharge I go off to another retailer that will accept Amex without surcharge and I will happily pay $1,030 for the same goods.

Moral of the story is any profit is much better than no profit and having the goods sit on the shop floor longer....

They're obviously not a PC hardware retailer then, as the margins on these are quite low :mrgreen:

 

[Dave Noble]

Re: AMEX not accepted or surchage

a 30% markup on purchase price of goods does not imply that the retailer is making a 30% profit

The profit is likely to be quite a bit lower than 30%. the $30 cost of Amex could be a significant level of profit lost.

Dave

 

[anat0l]

Re: AMEX not accepted or surchage

They're obviously not a PC hardware retailer then, as the margins on these are quite low :mrgreen:

Concur here. Margins were pretty thin on most hardware bar cameras, some MP3 players and media when I worked at Harvey Norman in 2003/2004. How times have changed - selling PC goods is a mug's game now.

Having said that, we couldn't refuse people paying by Amex if they simply took it off the shelf and paid for it themselves. When we do a proper assisted sale, however, payment option does affect our ability to "do a deal" (of which has become so commonplace in computers these days).

 

[zzyss]

Re: AMEX not accepted or surchage

a 30% markup on purchase price of goods does not imply that the retailer is making a 30% profit

Agree. It is a common misconception between revenue and profit. Profit is the (usually wee) bit that is left over after all the costs of running the business have been taken out from the margin. Shifting stock to maintain revenue has little benefit for small business, so most would not bother doing it, and especially not for the sake of pleasing a "minority group" of credit card payers.

 

[JohnK]

Re: AMEX not accepted or surchage

Your calculation only works on some cases, but doesn't work in other cases.

Agree that it does not work in all cases.

I just hope that cardholders also understands from the merchant point of view.

Factor the cost of the processing the credit card into the cost of the retail price. I would be prepared to pay $1,030 for goods and services and not $1,000 + 3% for the same goods and services. Think about it....

 

[Dave Noble]

Re: AMEX not accepted or surchage

Factor the cost of the processing the credit card into the cost of the retail price. I would be prepared to pay $1,030 for goods and services and not $1,000 + 3% for the same goods and services. Think about it....

So you think that everyone should be penalised for your desire to use expensive forms of payment rather than *you* being responsible for the extra costs that your choice of payment incurs

Why should a person paying by eftpos subsidise American Express cardholders

Dave

 

[JohnK]

Re: AMEX not accepted or surchage

So you think that everyone should be penalised for your desire to use expensive forms of payment rather than *you* being responsible for the extra costs that your choice of payment incurs

If that is what I posted then that is what I think. I do not have any EFTPOS cards and I don't think I ever will. I will just shop at places that accept Amex without surcharge. Not too hard to find, Coles, Woolworths, David Jones, Kmart etc, and it means that small business will not be getting my business. Very simple.

By the way handiling cash is way more expensive than credit card payments....

 

[lovestotravel]

Re: AMEX not accepted or surchage

Why were they willing to accept cash if they had already put you down as Eftpos and it was too much hassle to reverse?!?!

They must be doing well in this climate (though their customer service would indicate not) to knock back a sale, considering how so many others will do anything to get a a sale.

I assume they just wanted the sale and didn't' want me to walk

It was not possible for them to accept Amex as the guy did try first and then "remembered" that they no longer take it

 

[edman]

Re: AMEX not accepted or surchage

I assume they just wanted the sale and didn't' want me to walk

It was not possible for them to accept Amex as the guy did try first and then "remembered" that they no longer take it

Well I would have done the same, out of principle. False advertising if nothing else, and it would give me an indication about how far they would be willing to go with after-sales service if it was required.

 

[RB]

Re: AMEX not accepted or surchage

If that is what I posted then that is what I think. I do not have any EFTPOS cards and I don't think I ever will. I will just shop at places that accept Amex without surcharge. Not too hard to find, Coles, Woolworths, David Jones, Kmart etc, and it means that small business will not be getting my business. Very simple.

By the way handiling cash is way more expensive than credit card payments....

John I hope you keep living in big urban areas where these big chains seem to dominate the world. Maybe when small independent business is gone, ala petrol stations, people will change their attitude

 

[Chicken]

Re: AMEX not accepted or surchage

Factor the cost of the processing the credit card into the cost of the retail price.

You cannot do this in a lot of cases.

If you are a newsagent or convenient store, the prices of Metcard or TravelTen / TravelPass are fixed by the government. You cannot charge more.[/QUOTE]

Another example. National Parks and Wild Life in WA don't take AmEx if you want to buy passes. I can understand why, because organizations like these are already very poor, they simply don't need another extra expense.

I mean what? You get off the REX at Kangaroo Island, then going back onto the plane just because the island does not accept AmEX???

I will just shop at places that accept Amex without surcharge. Not too hard to find, Coles, Woolworths, David Jones, Kmart etc, and it means that small business will not be getting my business. Very simple.

So a home network router, like Linksys WRT54GL is about $100 from online store / computer corner store, add another 3% surcharge, that is $103. Sure, Hardly Normal don't surcharge AmEx, but they want $150 for it. Do you think your buying decision still makes sense???

 

[JohnK]

Re: AMEX not accepted or surchage

John I hope you keep living in big urban areas where these big chains seem to dominate the world. Maybe when small independent business is gone, ala petrol stations, people will change their attitude

Don't blame me. Society and our way of life has created this mess. I was quite happy with my passbook account and paying for everything with cash. Then slowly we were given no choice to the point now where some businesses do not have a shop front and only accept cards of some sort.

I hate big chains but they offer the flexibility I need today. I miss the days of having a separate butcher, baker, grocer and so on. Was having a discussion with my mother the other day about the lamb chops she purchased from Woolworths. They were cut way too thick as Woolworths packages them off-site and ships them to the stores. With a butcher we could get them cut any way we wnated.

 

[Evan]

Re: AMEX not accepted or surchage

One reason i buy a magazine from the newsagent rather than coles. Have to keep some of the little guys in business.
Coles in my area have some really good meat, but not all of them are like that, still i prefer a butcher to get the cut i want for example.

 

[cove]

Re: AMEX not accepted or surchage

Long live my butcher,baker and greengrocer.

Really good small operations can still do better quality and this is worth forfeiting Amex points if the trader is getting skinned alive compared with the 0.6 per cent fee the big retail chains seem to get charged.

If your local business is really good support it.That business will never return if it closes.

I have seen small traders getting charged 6 times more for Amex.

 

[JohnK]

Re: AMEX not accepted or surchage

I mean what? You get off the REX at Kangaroo Island, then going back onto the plane just because the island does not accept AmEX???

I don't use Amex for every single purchase. I will use a mixture of cash, BPay and Amex. There are still many things where I have to use cash like my local golf club, RSL or some small shops. I refuse to use EFTPOS and do not use Visa/Mastercard unless absolutely essential as they do not have anything to offer me. I had to use Wizard Mastercard for hotel booking in Singapore during Formula 1 in September as they wanted pre-payment. I would have been happy to pay cash as the hotel did not accept Amex.

So a home network router, like Linksys WRT54GL is about $100 from online store / computer corner store, add another 3% surcharge, that is $103. Sure, Hardly Normal don't surcharge AmEx, but they want $150 for it. Do you think your buying decision still makes sense???

I agree it makes no sense to pay that much more. Quickly looking on the internet for Linksys WRT54GL I have found OzTechologies online store accept Amex and have the router at $97.50 + 2% surcharge. I could save upto ~$8 from any number of other stores selling the same product but only accept Visa/Mastercard and some accept Paypal or BPay. If I really needed the router I will more then likely use this online store as they accept Amex albeit with a surcharge.

My decision is based part on principle and part on stubborness. If I have to use a credit card it will be a credit card of my choice. And that choice for now is Amex not what someone else decides....

 

[lovestotravel]

Re: AMEX not accepted or surchage

My decision is based part on principle and part on stubborness. If I have to use a credit card it will be a credit card of my choice. And that choice for now is Amex not what someone else decides....

Correct and that is exactly what I do

Why can't you support your local butcher/greengrocer etc etc?

My local fruit shop takes Amex
My local butchers (two in the same shopping centre) take Amex
A fish shop nearby takes Amex

I support these guys and I have made it clear to the owners that I am only shopping there as they accept Amex. They all had interesting stories to tell about debating with their business partners if they should take Amex, and the associated headaches. But they basically said why make their lives harder by not accepted a form of payment. Yes they miss out on 1% but they agree that they easily make it up from the customer who pay with Amex and avoid Coles/Woolies.

I always get my fruit, veggies, fish & meat from the local shops that take Amex.

Coles/Woolies is rubbish, but good for convienence! I have lost count of the number of times the fruit I buy from Coles/Woolies is rotton after just 1 or 2 days at home!

Fruit shop fruit/veggies always taste better/last longer, plus I am not supporting the big bullies ripping off the farmers, but that's another argument