Prices reflect a 3% cash discount

2004-01-25 16:27

This is too funny.

On the bottom of most of CaDan’s faxes, there’s a little disclaimer, in teeny-tiny type; “Prices Reflect a 3% Cash Discount.”

In CaDan’s policy and procedure manual, Procedures 04-02, page 1, we see the following:

NOTE: DON’T FORGET TO MARK UP 3% FOR CREDIT CARD CHARGES

What?

Well, see, the credit card company charges a couple percent of credit card transactions. Merchant agreements often prohibit passing this on, so the public face is to say that there’s a “discount for cash”. But, of course, the manual tells the true story; they mark up credit card charges, even though they’re probably not supposed to.

More importantly: They are, unambiguously, lying. The “3% cash discount” is actually “the real price”. That’s why the prices all look normal ($102.00) after the “3% discount”. Then they mark it up by 3% from the posted price.

Oooh, sneaky!

Would you do business with people like this?

Peter Seebach

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Comments

  1. I am the owner of a small business and I think that there's nothing wrong with what the company is doing.

    The thing is, when you buy something with a credit card, the CC company charges the merchant a fee, sometimes up to 5% of the transaction amount, for the privilege of accepting the card. For a small business with thin margins, that can be killer. The business person can either raise the prices for everyone by 5%, or give you the option of paying cash and saving both you and the business owner 5% of the fee. So basically, if you disapprove of the cash discount, it's the same as saying you want everyone to pay 5% more to the credit card company. Why not just take the discount? You save money, and the merchant saves money.

    The next time you use a CC, think about how much Visa or Mastercard is gouging the small business owner you're giving the card to.

    — Tim · 2004-02-28 17:50 · #

  2. My complaint is about the lie, mostly; they claim to be offering a discount, but they're not.

    Anyway, I run a small business, and we do what the credit card agreement says to - we accept the lower profit margin.

    The fact is, they aren't offering a discount; they're doing a surcharge, which isn't allowed.

    seebs · 2004-02-28 21:26 · #

 
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