credit cards what happened when you started taking them?

We have never accepted credit cards. We have been in business over 8 years. We have two locations. On location is a del/CO the other is slices. At the del/CO location we do about 75% delivery with an average ticket of about $22 in the summer and $30 in the winter. At the slice location the average ticket is about $8.

I am wondering if there is anyone else out there that started taking them after being in business for some time and what happened when you did start.

The credit card folks are telling me that average transactions will rise by 30%. That sounds improbable to me… but???

Also,

How many bad transactions do you have where you loose the $$ due to credit card fraud?

How much are the costs really? I know what the card folks are telling me, but what are you paying as a percentage of sales (CC sales, NOT total sales)

What portion of your sales are paid for with cards? Are you mostly paying fees on sales you would get anyway, or is this new business?

If anyone has a high volume slice business, I would be interested to know if the CC slows down the line. We max out at about $1000 an hour when we are busy so keeping the line moving is important.

Thanks

Re: credit cards what happened when you started taking them

We opened taking credit cards 13 years ago. Back then more people paid with cash and check.

Now a days we do 35% of our sales through credit card transactions. All credit card transactions are higher ticket averages than paying with cash. Tips are higher. With the debit card craze you would really do yourself a favor by taking cards.

On a personal note there are two ice cream shops where we live. We like the ice cream at one shop better but they only accept cash. We don’t carry cash. We are to lazy to go to the atm…so we go to the other shop. Plain and simple. They may now accept cards…I don’t know cuz we don’t go there…ever.

If you have one customer a week go somewhere else because they take cards isn’t it worth it?

We pay 3% of our credit card sales in fees. We also have a phone line for the machine which is an added expense but found it a requirement after a few years of taking cards. I consider it a cost of business.

Jump on the band wagon…whether you do it now or two years from now you are eventually going to have to do it.

We have never had a fraudulant transaction in 13 years.

Re: credit cards what happened when you started taking them

We’ve always taken cc’s since being open (2 years). I’d agree with Kris that if you don’t accept cards you’ll lose some business and also people do tend to spend more on cards.

I think the Kris has been very lucky not to have card fraud. make sure you train your staff well, be very cautious and unfortunately accept that you will at some point (unless your very very lucky) have some fraud. We have had only had a couple of cases but we’ve spotted plenty more just in time, and I genuinely don’t think you’ll ever avoid it totally.

Other than that - go for it.

Re: credit cards what happened when you started taking them

You have to be loosing out on a ton of business. Even your regular customers would come in more often and spend more if you accepted cards. How many people every night place an order with you decide not to order wings or breadstix with their delivery because they are short a few bucks?

I’m a cash guy. I never used credit cards unless I am making an online purchase. Being in this business, its easy to always have cash on me but there have been times (although rare) that I have used a card because I changed my shorts and didn’t transfer the cash.

Most people don’t have our luxury and so don’t always have cash available.

Card costs are expensive but the increased sales will “far” out weigh this. Google it. “Every” report you find will tell you the same.

Re: credit cards what happened when you started taking them

Thanks guys.

On the one order a week being worth it, I would say certainly not. One order a week is about $1500 per year in sales which, after food and labor is about $700 in gross profit. A 3% fee on 35% of my sales is nearly 10X that much. In other words, unless I figure I am missing about $15,000 per year ($250-$300 per week) I am ahead not to take them. I would need about 10 orders a week to cover that.

On the other hand, that also means I only need a 2,5% sales increase either from new business or average ticket increase to justify it.

The other real issue is whether it slows us down when we are slammed. Also, if I have to add another phone line to deal with it at each location I am looking at another $1400 in expense.

Re: credit cards what happened when you started taking them

When someone is paying with a credit card, it only takes about 30 seconds or less to process, print ticket, and have them sign it. It’s pretty quick and won’t slow you down that much. I think you’re crazy not to accept credit cards. I didn’t accept credit cards my first 4 years in the business and missed out on a lot of orders. I once missed out on a $1000 order because I didn’t accept credit cards. The order was 100 pizzas for a Christmas party for a bunch of workers at a large nuclear facility near us. The manager had to use the company card to fund that party. My place was their first choice for the food. Since I couldn’t accept credit cards, I had to turn the order down. I was pretty upset and did not want to lose out on an opportunity like that again. I was accepting credit cards a week later! You will definitely get more than 1 credit card order a week. You’ll get more than one a day. Personally, I almost always pay with my debit card when I go out to eat and so do most of the people I know. It’s a hell of lot easier than going to the atm all of the time. My advice would be to definitely start accepting credit cards. I would suggest buying your own credit card terminal off of ebay because that is where the credit card companies kill you. You’ll be paying forever on the terminal lease. After all my payments were done, I had paid $2014 for my terminal. If I only knew then what I know now. I could have gotten one off ebay for around $100.

Re: credit cards what happened when you started taking them

At first I did not take American Express because of the higher costs. After loosing a few $200 to $300 orders from local businesses I started taking it.
It is the only company card for many businesses.

The point is, as long as you are making “more” money, who cares what the costs are.

Re: credit cards what happened when you started taking them

i agree about the bonus card service gives
when i started taking them it was like someone opened a flood gate to extra revenue that surely would have not come to me
you need to get set up

Re: credit cards what happened when you started taking them

you can buy a top of the line terminal (new) for $200…

Sams Club credit card processing is 'bout the cheapest around - thru 1st data. (big guyz) …$.15/swipe & 1.5%

Re: credit cards what happened when you started taking them

How do you guys handle deliveries with CC?

Re: credit cards what happened when you started taking them

My point about one customer a week going somewhere else was taken a little out of context.

If you took that customer and his order once a week that would be 52 orders a year. Not to mention you are GIVING them to the competition. Not to mention the convenience you give them and the chance they may come two times in a week or have a nice order for a party they throw once a year and whatever else.

I imagine your avg. will go to 30 and 35 so that is 1690 a year and it would have only cost you appx $53 to keep them (including the phone line) And that is just ONE customer!

The return in the long run will be much higher but I was just using the one customer as an example and I think it was taken too literally.

Maybe you could use the added line and hook up a fax machine for those occasional calls asking for a menu to be faxed.

Re: credit cards what happened when you started taking them

Okay brace yourself…we use them on deliveries too but we have to pay the higher 4% rate because they are keyed in and not swiped.

IMO it is still well worth it…we are the ONLY pizza place that does it and we do a lot of them. As a matter of fact a lady called me yesterday cuz her daughter was at a local Karate school and didn’t have lunch…would we be able to do it over the phone and deliver it to her daughter…risky yes but then she called back and ordered 3 Large pizzas for the group and I said fine…ANYTIME. Sure we are in a small town and they are regulars so it was safe but hey they are regulars and who knows maybe they are regulars because we take cards.

I’m thankful for this thread because I do on occassion get frustrated when I see the monthly fees but instead I am going to look at the revenue it brings and keep focused on there.

Take the plunge :lol:

Re: credit cards what happened when you started taking them

while we are on the subject…anyone using the wireless from first data
this seems to be the way to go for you bodge,if you are a high roller in delivery…i would have gone this route but i am not a big player, (i have only 1400 households in my market) cuts a lot of corners

Re: credit cards what happened when you started taking them

The store I work at does alot of catering for businesses. Yesterday I delivered an order totaling $212. Pizza, wraps, chips, brownies/cookies, and about 6 2-liter bottles.

90% of them are CC

Re: credit cards what happened when you started taking them

Just a minor note…but assuming a 25% food cost, each sale you lose actually costs you 75% gross profit, because your labor is paid whether you make the sale or not. WE are also a high volume restaurant and lose no speed by taking the card. Also, if you don’t believe the credit card companies concerning increased individual sales from those that use card, then listen to all the retailers in America, who love to take cards because they know people spend more…there are studies that prove this, and I believe you can find some evidence on Dave Ramseys website.

John

Re: credit cards what happened when you started taking them

Don’t know if terminals have the option, but our cc processing is run through our DSL/Cable line which require no additional phone line.

I’d say if you don’t have a POS system to run your cc processing through you are missing out in that area as well.

Re: credit cards what happened when you started taking them

.

Sams Club credit card processing is 'bout the cheapest around - thru 1st data. (big guyz) …$.15/swipe & 1.5%

Sams advertise on their site “Rates as low as 1.64% + 19 cents per transaction”

I use them and getting 1.9% and .25 per transaction. 90% of sales are keyed in over the phone with a $20 avg ticket.

Of my monthly statement it turns out to be about 3.75% of the dollar goes to Sams/First Data

Re: credit cards what happened when you started taking them

Your nuts not to accept it. Alot of people don’t carry cash out there.

Credit Cards are 10% of my sales.
They process right through my POS via Internet. It takes 3 seconds, prints out the receipt and done.
My POS system also holds a customers credit card on file, for future use. (Best Feature ever). so next time they call they just say put it on the card.

Re: credit cards what happened when you started taking them

Yeah, but I don’t feel so badly missing out on a $10K debt :smiley: I may get a POS soon, but I’m not yet losing sleep over it . . . my Card machine cast me $85 from eBay including shipping. I haven’t looked back since it came in.

Re: credit cards what happened when you started taking them

which POS? I was told that was no longer legal…great feature though