Village Kitchen

[Pineedles]

Originally Posted by dpg

I also agree it's a great quick meal, my only complaint if I had to think of something is the fact that they take no plastic as a form of payment. I don't go for the excuse it helps keep their cost down. I'd rather see the prices increase a couple percent for the added convenience. In todays society everybody uses it and it's getting to be more and more of an inconvenience when you come across an establishment that doesn't take it.

They do have an ATM inside for those who want to use plastic. I personally think that is a much better way, than increasing paperwork and prices.

[thinkxingu]

Originally Posted by Pineedles

They do have an ATM inside for those who want to use plastic. I personally think that is a much better way, than increasing paperwork and prices.

If I remember correctly, it's a $3 charge to use it. I've avoided that by paying with check, but I agree with the post above that it's time to start accepting cards.

[Pineedles]

Originally Posted by thinkxingu

If I remember correctly, it's a $3 charge to use it. I've avoided that by paying with check, but I agree with the post above that it's time to start accepting cards.

All I am saying is, raising the prices for everyone is not the answer. You avoid the ATM fee by paying by check. That's great. It's just another way the VK makes it easy for one to pay. I love this place and I know that hundreds of other folks do too as well.

[Crusty]

Many years ago, I worked on the "big iron" that ran the largest VISA processor in the country. We worked ceaselessly to 1) ensure the network was up and running 24/7 and 2) maximize profit. Consequently, I have always been interested in just how lucrative credit card processing can be.

Until late in 2010, merchants were over a barrel if they accepted credit cards. They had to pay both a transaction fee and a percentage of the sale. The rates were set by the card companies and if you didn't agree to it, you couldn't accept the card. The most troublesome part of this merchant "agreement" was that merchants couldn't promote other forms of payment or discourage use of the card. Because the states and federal government finally went after the card issuers, that part of the agreement is now gone. A merchant is free, in principle at least, to add a "credit card fee" to a bill. [Typically, $.35 + 3-5% of the total.] However, most merchants are afraid that such charges would discourage business.

Also, since 2014, debit card fees have been capped at $.21 per transaction (which provides a huge profit for the banks).

Final analysis, if a restaurant decides to accept credit cards, they may need to increase their prices by about 5% just to cover the banks' cut. Accepting debit cards is much cheaper, although significant if the average check is small.

Of course, don't forget that banks charge a per check fee for deposits. Some also impose a charge for cash deposits. If your cash deposit is over $10k, you need to file federal forms. [If your cash deposit is regularly just under $10k, the feds may seize your bank account and charge you under the "criminal banking" statutes.]

My conclusion is that if you are running a successful cash business with small margins, you need to think long and hard before taking 5% off your gross income.

[brk-lnt]

Originally Posted by Crusty

Until late in 2010, merchants were over a barrel if they accepted credit cards.

This wasn't my experience accepting cards for an online and physical store location in the late 90's/early 2000's. Like anything you had to shop around for the best deals, but there were several options.

Originally Posted by Crusty

The most troublesome part of this merchant "agreement" was that merchants couldn't promote other forms of payment or discourage use of the card.

This sounds like you worked for AMEX. They typically have/had their own agreement and the wording stated that you couldn't discriminate against AMEX specifically (EG: Visa/MC would have no additional fees, but AMEX cards would have a 2% surcharge, etc.

Companies have always been able to make the acceptance of credit cards options and offer an across the board CASH/CREDIT price difference. This may not have been true for EVERYONE merchant processor, but it wasn't a universal truth that you had no option for 2-tier pricing just because you accepted credit cards.

Originally Posted by Crusty

Because the states and federal government finally went after the card issuers, that part of the agreement is now gone. A merchant is free, in principle at least, to add a "credit card fee" to a bill. [Typically, $.35 + 3-5% of the total.] However, most merchants are afraid that such charges would discourage business.

Those numbers seem high to me, but as I recall it was all very much based on size of your business, average transaction size, average daily collections, etc. I think we were at like 2.5% for card-present transactions and 3.5% for online/card not present, plus a 25 cent fee.

Originally Posted by Crusty

Of course, don't forget that banks charge a per check fee for deposits. Some also impose a charge for cash deposits. If your cash deposit is over $10k, you need to file federal forms. [If your cash deposit is regularly just under $10k, the feds may seize your bank account and charge you under the "criminal banking" statutes.]

My conclusion is that if you are running a successful cash business with small margins, you need to think long and hard before taking 5% off your gross income.

Your conclusion is puzzling when you point out above that there is generally no free way to operate your business banking. You're charged for cash deposits, checks, etc. You also run the risk of bad checks (one of which could equate to a weeks worth of credit card fees).

[TiltonBB]

Originally Posted by thinkxingu

If I remember correctly, it's a $3 charge to use it. I've avoided that by paying with check, but I agree with the post above that it's time to start accepting cards.

The fee on the ATM at Village Kitchen is $2.50, not $3.00.

Don't forget that in order to provide that convenience for those people who do not carry cash there are significant costs to have an ATM available. The cost of the machine itself, access to internet service and a procesing company for the machine to provide transactions through. It is also necessary to tie up thousands of dollars in ATM machine inventory to have that cash available to customers.

Also, people who use that machine may take out a lot more money than they spend at the Village Kitchen so that they have a little "walking around" money.

There are no free lunches anymore! It costs money to go through life!

[brk-lnt]

Originally Posted by TiltonBB

Don't forget that in order to provide that convenience for those people who do not carry cash there are significant costs to have an ATM available. The cost of the machine itself, access to internet service and a procesing company for the machine to provide transactions through. It is also necessary to tie up thousands of dollars in ATM machine inventory to have that cash available to customers.

ATM's are very profitable to own these days. If the VK is actually *paying* to have an ATM there, they are getting robbed. They should either own the ATM (and make money off the fees) or lease the space to whoever owns/maintains the ATM.

[TiltonBB]

Originally Posted by brk-lnt

ATM's are very profitable to own these days. If the VK is actually *paying* to have an ATM there, they are getting robbed. They should either own the ATM (and make money off the fees) or lease the space to whoever owns/maintains the ATM.

The ATM's are only profitable beyond a significant number of monthly transactions. There are expenses like processing, internet access, disputed transactions, and repairs, that significantly affect the income. There is also state licensing because when a machine is not bank owned there is an annual state license fee. There is also the cost of keeping your cash in an an ATM machine

Also, all of the older ATM's must now be converted to a machine that accepts the newer credit cards that have the chip in them. That expense is in excess of $1,000 per ATM