Just had some work done on our pool. Local company replaced a lightbulb for $1,300 + $200 labor. Ok, expensive but it is what it is.

Now today I get a copy of the bill and they charged me 3% additional because I put it on a credit card. I hate that crap. They should have let me know and I would have sent them a check.

Am I wrong to be upset by this. No other service provider I use charges this fee.

There merchant processor is the one charging the fee and they are simply passing it on to you. The only issue is they should have been upfront about the fee and let you decide what form of payment you then wanted to use.

It's technically illegal in Texas (except menu pricing as noted above) but that has been blocked by a federal court. It's legal in most states and I think eventually Texas will either change the law or lose in court and that will change the law. Nobody wants checks and nobody pays in cash anymore.

IMO they're simply a cost of doing business and the business should decide either to eat the fee or not take cards but that's not how it's playing out. I hate the sob stories from local businesses on how the fees eat into their margin and they're just a small business trying to stay open. Run your business to make the profit you want to make. That's literally your job. I'm a fractional CFO so I see this stuff all the time. Account for that 3% as a cost and price accordingly. It isn't hard unless you make it hard.

Thanks. And totally agree. Just be up front and I'll write you a check.

Here's my theory-

We used to not allow CC payments because of the fees and would wait to be paid by check. From 2010 to 2017 (when we began allowing cc payments) we regularly wrote off between 50-75k in revenue each year from deadbeats that wouldn't pay after we did work for them. Our only recourse was to put them on the do not work for list.

We began allowing CC payments and even attached a link to our emailed invoices allowing people to pay with a CC in 2017. Funny thing started happening, our deadbeat receivables went way down. We gladly eat the fees (2% ish) in exchange for less accounts in collections.

Here's where my theory comes in~

2 words. Cash Flow. Here is a text book example- we go out to a house for a "bad breaker" call. When we get there we see that the buss is burned up on the panel and it's not the breaker but the panel itself and the heat is causing a fire hazard. This is about to be a catastrophe. When the home owner called they are expecting a 100-200 dollar fix, now they are staring at 1500-2000 dollars and this is a necessity. We do the work, city comes and inspects, power gets turned back on and everything is great. Except Sam and Suzie Homeowner do not have the 2k to pay us. They are embarrassed about not having the money so they make the tough decision to stiff us. If they could have paid with a CC my chances of getting paid increase exponentially. Sure it costs me 40 bucks to get that 2k but if I have %10 margin built in to that 2k, we still make $160 gross profit on the job and everyone walks away not mad.

That's how we do it and if it costs me 50k a year in fees instead of 50k a year in non payments I can live with that.

EliteElectric said:

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Here's my theory-

We used to not allow CC payments because of the fees and would wait to be paid by check. From 2010 to 2017 (when we began allowing cc payments) we regularly wrote off between 50-75k in revenue each year from deadbeats that wouldn't pay after we did work for them. Our only recourse was to put them on the do not work for list.

We began allowing CC payments and even attached a link to our emailed invoices allowing people to pay with a CC in 2017. Funny thing started happening, our deadbeat receivables went way down. We gladly eat the fees (2% ish) in exchange for less accounts in collections.

Here's where my theory comes in~

2 words. Cash Flow. Here is a text book example- we go out to a house for a "bad breaker" call. When we get there we see that the buss is burned up on the panel and it's not the breaker but the panel itself and the heat is causing a fire hazard. This is about to be a catastrophe. When the home owner called they are expecting a 100-200 dollar fix, now they are staring at 1500-2000 dollars and this is a necessity. We do the work, city comes and inspects, power gets turned back on and everything is great. Except Sam and Suzie Homeowner do not have the 2k to pay us. They are embarrassed about not having the money so they make the tough decision to stiff us. If they could have paid with a CC my chances of getting paid increase exponentially. Sure it costs me 40 bucks to get that 2k but if I have %10 margin built in to that 2k, we still make $160 gross profit on the job and everyone walks away not mad.

That's how we do it and if it costs me 50k a year in fees instead of 50k a year in non payments I can live with that.

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Everything Pavlatos has said here is consistent with our business as well. We collectively between all of the businesses pay about $200k in credit card fees for the privilege to accept cards. We eat the fees and fix it into our business models. The banks have done a stellar job of getting us all "on the leash" to use credit cards and line their pockets. We all have the rewards, rebates etc. Those tidy little perks are paid by the merchant fees to accept the cards.

In my younger years I attempted once to pass the fee onto the customer and offer a cash discount. Not only did I have a mutiny on my hands, but that costly experiment taught me that people prefer the cost of convenience over the savings 99 times out of 100. The irony is that everything in society is more expensive to the consumer this way, but they don't seem to care.

75AG said:

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They just responded that Quickbooks charges them that fee. I don't use Quickbooks, so I don't know that to be true or not. Either way, I won't be using them for anything else.

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I had a contractor tell me this last year that did some work on my new house.

Him: "Oh man Quickbooks charges me a fee, I wish you wouldn't have paid through quickbooks."

Me: "Well, you sent me the quickbooks link to pay...?".

I wrote him a check for the next invoice. That was a problem too. I wrote it to the company name on his invoice, but he needed it written to him personally.

It's incredible how many people make it hard to give them money.

MyNameIsJeff said:

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75AG said:

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They just responded that Quickbooks charges them that fee. I don't use Quickbooks, so I don't know that to be true or not. Either way, I won't be using them for anything else.

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I had a contractor tell me this last year that did some work on my new house.

Him: "Oh man Quickbooks charges me a fee, I wish you wouldn't have paid through quickbooks."

Me: "Well, you sent me the quickbooks link to pay...?".

I wrote him a check for the next invoice. That was a problem too. I wrote it to the company name on his invoice, but he needed it written to him personally.

It's incredible how many people make it hard to give them money.

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He likes writing to him personally as probably half of it isn't claim on his revenues,

I just adjust my prices to cover it.

maroon barchetta said:

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I like to pay cash at restaurants when possible. Having been a server before, cash tips are preferable to credit card tips.

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we try to ALWAYS pay cash for tips

or uncle scam

All these places that menu price and then state that the price reflects a cash discount are stupid. Just price it, and if someone pays cash, cut them a break (or not). I get so tired of what feels like being nickle and dimed all the time.

75AG said:

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Thanks. And totally agree. Just be up front and I'll write you a check.

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I always ask (over $1000) if there is a cash discount. Some times I get 3-4% off.