In Memoriam, In Advance
July 26, 2016
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I stopped by my local pool place last weekend for some chlorine. At the checkout they had a sign stating that as of August 1st, they will no long accept credit cards – cash or check only. I asked for more clarification, no debit cards either. So, I give them about 2 months to live. Definitely won’t see 2017.
This business had recently tried implementing a “cash discount” and that didn’t seem to work, because I don’t see those signs anymore. I’m very confused as to what their logic is. Accepting a check is probably more risky than accepting a credit card. No one carries $500 around with them to buy a chlorine generator. It’s unlikely businesses would set up accounts with them unless they can do monthly invoicing and hold out the net 30 terms.
I thought this would make their online sales unworkable, but a quick check shows that their website cart uses PayPal. This raises even more questions. Why not get a PayPal mobile card reader and use the same account for store sales and online sales?
I mean, if they are getting hammered with CC swipe fees and TX charges, they need to renegotiate. Or they need to look at their margins. I’ve always known that the ones paying cash were getting shafted because a store’s prices had to assume that CC fees would be included. I’m puzzled by this in the same way I’m puzzled that gas stations can survive with Cash/Credit pricing.
But in the end, my guess is they won’t be sticking around much longer. Here’s the important thing. They’ve made a decision they can’t easily take back. They may get one more transaction out of each customer (they already got mine). But after that, customers like me aren’t going to return. If they realize their decision has now brought the business into a death spiral and they want to start accepting credit cards again, who’s going to know? All the former customers have written the business off. They could put a banner out front saying “We fucked up and we accept credit cards again!” but that’s some serious crow to eat. Maybe the banner will be “Under New Ownership!” which might invite old customers back to see if the payment options have returned.
It’s sounds like another case of small-business America dying, but sometimes that death is caused by a self-inflicted injury.