It’s the [new] age-old issue of if you can’t afford a fee that amounts to roughly $3 per $100 spent, you shouldn’t be eating out. But to me its not about that $3 or whatever. It’s a tacky nickel and diming of the customer. And it won’t be getting better any time soon.
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I think the real problem is the exorbitant fees and charges by the banks on business and consumers, especially on the disadvantaged and those with limited means. They pass along the fee because they know most people can and will pay it.
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Odessa. Great place. Lots of steam in the air, and gallons of butter and sour cream.
Your final sentence gets to the heart of the frequency with which restaurants surcharge the use of credit cards.
Precisely its not the amount of $$ involved its the principle .
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I’m curious. No one remembers restaurants – especially Chinese ones-- offering an X% discount if paying in cash OR an up-charge when using a credit card (not debit) for like the last oh 40 years or so? Yeah it’s exploded with the now “standard” payment method: a debit card…and going nuclear post COVID.
I do think businesses should bury the increases in the pricing.
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Speaking for Chinese restaurants in my area of New Jersey, none that I know of ever offered a cash discount nor a higher price for credit cards. The place we routinely order from has raised the prices of some menu items anywhere from 30 cents to $1 (we compared old and new menus one night out of curiosity) and raised the delivery minimum from $10 to $15. Neither of these is a big deal (to us) especially the minimum since we always surpass that.
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Chinese restaurant offering discount never heard of it in NJ or NYC
Most Chinese, Indian and Vietnamese restaurants in the part of Canada where I live offer a cash discount of 10 percent. One also throws in an order of bonus spring rolls. A few Greek restaurants also have a cash discount. Sometimes they even call it saving the tax (our sales tax in Ontario is 13%), which sometimes means they aren’t keeping the cash sales on the books.
I also know contractors and hair stylists that run their businesses like this.
Some, probably most, of these restaurants near where I live are not ringing the cash sales into the cash register, and are saving money by running a cash business. They’re also often paying some or all of their staff under the table, and those employees aren’t going to be receiving workers’ comp, etc if they are hurt at work.
The margins are very tight right now, so I can understand some business owners running their businesses like this. Of course this has been happening for a very long time. Cash is still king, in some places.
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Businesses that surcharge credit card transactions are almost always small time operators who don’t understand that cash also costs them significant money to handle. I would argue that cash is as expensive to accept as cards, and surcharging credit cards makes no business sense.
Why is it that large sophisticated businesses nearly universally accept credit cards while mostly small ones run by folks with minimal business training are the ones who don’t?
Handling cash has many costs, even before lost sales are considered. The main thing small business owners (especially restaurants) understand is the tax cheating part.
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Cash handling has costs - it must be counted, reconciled, and transported to the bank, all of which takes time, and the time involved is of the higher-paid manager, which is both costly and detracts from running the business. These costs may not seem large to the casual observer, but in my estimation they are in fact substantial when compared with the cc fee which mostly eliminates them.
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Where there is cash there are always sticky fingers. Cash bleed is a major but unknowable cost for small businesses, and employees, even family, are astute at finding ways to divert it from the register. Cards mostly eliminate this problem.
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Where there is cash there are increased risks of violent crime. Consider the Spumoni Gardens guy who got himself killed while carrying the restaurant’s cash receipts around. Having lots of cash around puts employees at risk. If I were planning rob a business, I’d pick a cash only one.
Put all those things together, and you have a better understanding of why large sophisticated companies understand it is probably cheaper for them to accept credit cards or at worst not much more expensive.
Then add the extra sales. The profit from extra sales is high when most of the costs are already paid anyway, so lost sales can certainly hurt but are invisible. I’m sure they lose sales because I generally avoid places that add a surcharge and I’m sure there are many others with the same approach.
As far as the tax cheating angle is concerned, I believe to have civilization we need government that has to be paid for, and prefer to not patronize those who shirk their obligations to the rest of us. Call me idealistic.
The cc fee is highly visible to small businesses – the other costs are mostly invisible. The small guys who decide things by their gut feelings are the ones who insist on cash. I’d say they are also the ones who go bust more often. Draw your own conclusions.
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Margins are always “tight.” That’s just life, and isn’t a valid reason for anything.
I don’t understand why so many people condone tax cheating.
And not accepting cc’s may well be more costly than accepting them. See my post.
I can’t remember it because I’ve never seen it. Maybe the practice is specific to your area.
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The BMW dealership is surcharging payments by credit card over $5000 in my region. Times are changing.
Many businesses would never stay afloat if it weren’t for some under the table deals.
What do you do for a living?
Much of the construction, cleaning and restaurants businesses rely on cash business.
I’m not so judgy, I guess.
Not restaurants, but the Asian grocers in our area def offer a cash discount.
Many businesses would never stay afloat if it weren’t for some under the table deals.
Much of the construction, cleaning and restaurants businesses rely on cash business.
I’m not so judgy, I guess.
The reason they do it is not because it’s inherently necessary in their industry. It’s because so many of their competitors do it so they have to do it as well to remain competitive. In other words, a race to the bottom in which they are all equally guilty. It should not be condoned by the rest of us.
Taxes are a cost of doing business like any other cost, and should be paid and reflected in everybody’s prices. Taxes support government services that are necessary to do business (and protect the public). Would you accept that it would be OK if they all stole from their suppliers and their employees to stay in business, because their competitors do it? I didn’t think so. Taxes are no different. Condoning stealing from government, because folks don’t like to pay taxes, is wrong. Calling it out is not being “judgy.” It’s the correct position. If the result of enforcing the tax code is all the competitors pay their taxes and then all have to charge $3.99 for your plate of eggs and toast instead of $3.79, is that such a bad thing? You can’t afford to pay the extra .20? Before driving home in your BMW?
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I agree with the sentiment behind your statement, but society (well, ours anyway) has never run that way & probably won’t in the future. Taxes aren’t the only issue that would be relevant to your post. Speed limits on roads and so many other laws/rules/regulations are seen as things to be avoided when possible. And I’m not so sure any of us are totally innocent of some “race to the bottom”. Its part and parcel of our inherited “culture”.
Aside from that, I think you’re understating the additional charge for the plate of eggs if the diner has to declare taxes accurately and pay their workers accordingly. After all, all the suppliers & contractors would have to charge this business more $$ if they, too, had paid their taxes accurately & these costs would be passed on to the plate as well. Just my 2cents (again, while agreeing with your sentiment).
My point is that big businesses like BMW are offering customers a small discount- or being transparent with what the charges are if paying by credit card- if they pay through cash or money order instead of credit card.
I pay my taxes, and I tip well. I don’t go out of my way to seek out restaurants that have cash discounts.
I also pay tips with cash so the server doesn’t have to declare it.
If it’s a small business and I have cash, I pay with cash to save them that charge on the credit card or debit card. It doesn’t cost me more to pay then in a way that helps their bottom line.
A lot of people are very poor right now. I am not going to judge anyone who is struggling to get by, who pays their staff in cash, gets paid in cash, or goes to restaurants that only accept cash.
If I wanted to avoid all cash-only restaurants, I wouldn’t be able to dine at the Hungarian restaurant in my neighborhood. I wouldn’t be able to buy empanadas at some of the Latin American bakeries in my city.
I rather keep the money local, and cash keeps it local, if I’m paying cash at mom and pop restaurants, compared to paying for food at a chain restaurant with a credit card.
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I pay some bills for my elderly mother. Her water municipality just started charging a fee to use a credit card, but not an e-check, so that is fairly simple.
But her landscaper charges 4% for credit cards and on-line payments, so I mail a check to him.
The electric company doesn’t charge any fees, you can pay it any way you want… I guess they are just happy to get any money from their customers.
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Great retort bravo my man 
