Credit Relief is Past Due

The
cost some retailers are paying on credit card fees is crippling, but a
panel of retailers and industry experts said relief may be on the way.
Convenience Store Decisions, with the help of ISD Corp. and the
National Association of Convenience Stores (NACS), hosted a Webcast
Sept. 19 to discuss the ever-increasing credit card fees that
convenience store and petroleum marketers are paying. The goal of the
Webcast was simple: CSD wanted to show just how severe the problem is,
while offering solutions that can help retailers alleviate their
situations.

The Problem with Credit Cards

For some higher-volume
retailers, credit card processing fees have soared past $1 million per
month. In 2005, credit card fees cost the convenience store industry
$5.3 billion, according to the 2006 NACS State of the Industry report.
That’s a sharp $2 billion increase from 2004. The reason is due mostly
to the higher cost of gasoline. The higher cost of gasoline has had a
devastating impact on processing costs. The industry sells
approximately three-quarters of all the gasoline purchased in the U.S.
Rising prices often means customers are more likely to use credit over
cash when paying for fuel purchases. While some markets have moved to
two-tier pricing for cash and credit, the majority of operators in
competitive markets have been forced to absorb the additional
processing costs at the expense of their fuel margins.

Source: Credit and Collection News

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