Paying surcharge fee for use of credit card

[AzoneHits]

Just want to know if anyone has experienced paying surcharge fee for purchasing a gun from a merchant using a credit card. I just felt like this should not happen - should be a merchant's responsibility unless agreed upon "up front" and I believe that it is not a "good business practice". Just want to know your opinion.

Edited January 26, 2008 by AzoneHits

[Scott R]

Keep in mind that the merchant is being charged to process the transaction and this cuts into the profit margin. They could always mark up their merchandise and then offer cash or check discounts, same end result.

Here is some interesting material on the subject. http://www.gofso.com/Premium/LE/06_le_ic/f...-merchants.html

[cpty1]

I've been on both sides of that fence. As a merchant, if the price on a particular item is marked down to the extent that the credit card processing fees, (generally 3%) eat up the majority of the margin on the sale, I will sometimes request payment other than credit card. The customer always has the option to send a check or money order and I hold the item for the customer until payment arrives. I suppose I could mark the price up so the card fees are covered by the sales price but again, depending on the price of the item, the 3% could be the difference between a good price and one not so good.

As a consumer, the 3% is only significant on a more costly purchase, and I've usually done some research to know whether the price I'm paying is a good price or not on higher dollar items. If I know it's a low price, I understand why the merchant would want to charge an extra percentage. That's the trade-off. I then have the option to pay with the convenience of the card, or send a check or money order. On another note, a large percentage of the distributors and supply houses that I do business with also tack on an additional 3% for purchases made with a credit card. Their advertised or catalog price is always assuming payment is made by means other than a credit card.

[Joe4d]

I wont pay it. merchants accept credit cards to make it easier for buyers to buy. They could allways say "No credit Cards" but they dont cause running a business especially online like that and they wont sell anything. I think it is similar to a merchant asking you where you saw the add then charging you more or less depending on the advertising rate at the place you saw the add. I really dont care what expenses the merchant has. Its called overhead. There are numerous minor expenses involved with selling a product, to itemize certain ones out is pretty petty in my view. I wont deal with a vendor or individual seller that does it. I also believe it violates agreements with credit card companies and if reported the credit companies will close their accounts or refund you the overcharge. But I am sure plenty of merchants will cry foul and tell you all about the fees they are charged. I really dont care. I wont do business with you.

[mscott]

Local guy charges 2 percent. I like my check card a lot, but I try to pay cash there. I don't see a problem with it.

Edited January 26, 2008 by mscott

[AzoneHits]

Keep in mind that the merchant is being charged to process the transaction and this cuts into the profit margin. They could always mark up their merchandise and then offer cash or check discounts, same end result.

I totally agree when it is being done this way where you know why and what happens when using payment options up front.

But what if you paid a partial amount for the agreed price and then ask you later that you have to pay surcharge fee for the remaining balance if you use a credit card that has not been brought up as part of the terms and agreement when you agreed to purchase the gun prior to the sale? I think this is my main question in this kind of transaction.

Edited January 26, 2008 by AzoneHits

[Scott R]

Keep in mind that the merchant is being charged to process the transaction and this cuts into the profit margin. They could always mark up their merchandise and then offer cash or check discounts, same end result.

I totally agree when it is being done this way where you know why and what happens when using payment options up front.

But what if you paid a partial amount for the agreed price and then ask you later that you have to pay surcharge fee for the remaining balance if you use a credit card that has not been brought up as part of the terms and agreement when you agreed to purchase the gun prior to the sale? I think this is my main question in this kind of transaction.

Did you mention you wanted to pay with a CC?

I have been in the situation of breaking out the plastic and being advised of an additional charge more than once and had to weigh out the cost versus convenience in each situation. Never had any hard feeling towards the merchant. I have always known of the charge to the merchant when using a CC and kept that in mind when bargaining for the best deal.

[AzoneHits]

Never had any hard feeling towards the merchant.

Same here. Just hate surprises. Edited January 26, 2008 by AzoneHits

[Action Pistolero]

My local gunshop charges more for using a cc. I have him ring it up as a debit and it only costs him 25 cents. Makes both of us happy that way.

[dirtypool40]

I'm undecided. I mean, am I getting more business because you could CC it?

IF not then, the other way to look at it is the item costs X amount "to me" and if it costs 3% to use the CC then the buyer eats it.

I can see both arguments.

[scirocco38s]

My local gun store that I will purchase from clearly states on all price tags that the price is (x-amount cash or check). If you use a debit card it is the same also. But if you use a credit card he charges 3%, the same amount he is being charged. I understand why he does it as he has excellent prices on his guns. The items that are accessories are marked up the same way. If you dont want to buy, dont. But he is informing you at the beginning that it is his policy. It must work for him as he has been in business for a while and a lot of customer think he is treating them more than fair. When you go to a store that is charging list price for a gun such as a Beretta or Glock has the amount of profit needed to absorb the 3% fee from the credit company.

[JimmyZip]

My local gunshop charges more for using a cc. I have him ring it up as a debit and it only costs him 25 cents. Makes both of us happy that way.

That's what I do. Check cards can be processed like that at most locations. I've found some merchants unaware and happy to oblige when I've pointed that out. ( It usually is someone not used to that ability of check cards) Can't understand why he wouldn't post a sign though. I don't mind as long as he tells me before he stars to ring it up. That way I can run down and get cash.

JZ

[Greg Bell]

On the flip side I've tried to negotiate a cash price discount and been rebuffed. So if I still want the item bad enough I'll just pay with a card to mess with them.

[Kingman]

It is illegal and against most credit card processing agents agreements.

You can give a cash discount, but by law at least in this state you can not charge extra. In other words you advertise the higher price and then offer the discount. That is why most gas stations that used to have a cc and cash price now only have one.

[Middle Man]

Another point to consider from the merchant's point of view. They have to wait for their money when a consumer uses a credit card. That money does not automatically show up in the merchant's bank account. Credit card money usually doesn't show up in their bank account for three to five business days. In the mean time, the cc processor holds that money in some bank account and gains interest on it for a few days (in addition to charging a fee to the merchant and double digit interest to the consumer). The credit card processing companies make out like bandits...they collect from everybody.

Most of the problem with credit cards in gun stores revolves around the fact most all gun stores operate on the razor thin edge when it comes down to cash flow. New firearms sales are a low margin business on average. Most consumers are totally ignorant of this reality. Used guns are almost always more profitable...

Edited January 26, 2008 by Middle Man

[boo radley]

Most of the problem with credit cards in gun stores revolves around the fact most all gun stores operate on the razor thin edge when it comes down to cash flow. New firearms sales are a low margin business on average. Most consumers are totally ignorant of this reality.

That I believe...

Used guns are almost always more profitable...

You may be right, but I am amazed how loathe dealers are to touch any kind of trade-in, at least in my limited experience.

[Middle Man]

Used guns are almost always more profitable...

You may be right, but I am amazed how loathe dealers are to touch any kind of trade-in, at least in my limited experience.

There are several viable business models for retailers to employ and some do shy away from used guns.

[AzoneHits]

It is illegal and against most credit card processing agents agreements.

You can give a cash discount, but by law at least in this state you can not charge extra. In other words you advertise the higher price and then offer the discount. That is why most gas stations that used to have a cc and cash price now only have one.

That is what I know and understand - unlawful to do it. It's either you mark up the price up front to cover cost of CC use or give discounts to buyers who pays with cash, MO, personal check or cashier's check

What difference does it make if you bought other goods amounting to the same amount of the gun? You are not charge with a surcharge fee to buy other goods with CC but charge you a surcharge fee for the gun? That I don't understand.

I believe this is a constructive criticism that I hope will help or maintain good relationships between the consumer and the merchant/s who practice good ethics when it comes to this kinds of transaction. I have no ill feelings towards any merchant/s related to this issue. I also hope that it will help change practices of how merchants deal with consumers regarding this issue.

[uscbigdawg]

I'm for it. In watching some consumers "shop" prices between competing vendors, Brownell's "dealer" discounts, et. al., it's hard for folks to build in an acceptable profit margin. Then to have to whack 3% of that to the CC companies kills what maybe was left. Our vendors bend over backwards for us and the least we can do is at time pay full price for some things. I think this surcharge is less prevelant in "USPSA/IPSC" vendors, but it is out there.

Rich

[Seth]

Its the vendors responsibility to price their products so that they can make an appropriate profit on it. A credit card is THE principle form of transaction for most purchases at this point and the vendor should be smart enough to build the fees into their margin.

The fact that they don't and charge a fee is a clear indication of a poor business model, in my opinion. I wouldn't do business with some one that smacked me with that post agreement of terms (even if the terms are just agreeing to purchase).

[warpspeed]

I'm OK with the CC surcharge as long as it is posted / listed.

I'm not OK with the add on after we agree on a price. I have a local gun dealer that has very good prices and never says boo when I hand him my CC.

In the past, I have said " What's the cash price ?" Occasionally that gets a couple of $'s off. But I don't ask unless I have the cash in hand.

[cpty1]

Absolutely agree that an advertised, listed, or agreed to price should be honored irregardless of the method of payment used. The only time l will sometimes opt for an additional 3% surcharge is on "call for price" type items (which are generally few in number) and for which the 3% could be $50/$60 or more. I make it clear in those cases there is a check/money order price or that price plus 3% for card.

I agree it would be simple to just price up 3% to cover the card fees, but why should the guy with a check pay $50 or $60 more than he would otherwise? I'd be more upset about paying that extra $50/$60, buried in the price for card fees when I'm not using a card, than having a payment method option that will save me money.

[AzoneHits]

I agree it would be simple to just price up 3% to cover the card fees, but why should the guy with a check pay $50 or $60 more than he would otherwise? I'd be more upset about paying that extra $50/$60, buried in the price for card fees when I'm not using a card, than having a payment method option that will save me money.

This is where vendors have to be clear that when paying cash, check or money order, you get a 3% discount specially on items that run into thousands.

[cpty1]

This is where vendors have to be clear that when paying cash, check or money order, you get a 3% discount specially on items that run into thousands.

So aren't we saying the same thing? What's the difference between making it clear there's a 3% discount for cash when the card fee is buried in the price, as opposed to a 3% surcharge when the fee isn't factored into the price. Ultimately the same price is reached, it's just arrived at from different starting points.

[AzoneHits]

This is where vendors have to be clear that when paying cash, check or money order, you get a 3% discount specially on items that run into thousands.

So aren't we saying the same thing? What's the difference between making it clear there's a 3% discount for cash when the card fee is buried in the price, as opposed to a 3% surcharge when the fee isn't factored into the price. Ultimately the same price is reached, it's just arrived at from different starting points.

When it is agreed upon up front, there is no difference. But when it is done through the side or back door, there is a difference.