Handing out change

[Frank Cox]

My adult admission price was $9 but as of Oct 1 the government has added another sales tax to movie tickets so I raised the price to $10 to make up for it.

In Canada we have a $1 coin and a $2 coin, called loonies and toonies respectively.

I've always gone through loonies and toonies and never gained them. I assumed that with a $10 admission I'll be going through less loonies and toonies because I won't be handing them out to everyone when they buy their ticket.

However, I'm actually handing out more of them which seems awfully strange.

After giving this some thought I think it's because people used to get their loonie or toonie when they came in and handed over their twenty dollar bill. That change was then spent when they bought their popcorn and drink.

Now they don't get that change when they walk in the door so they pull out another twenty dollar bill for their popcorn and drink and get even more change than they would have before. Multiplied by however many people came to the show and suddenly the loonies and toonies are disappearing even faster than they did with a $9 admission.

I think that's interesting and counter-intuitive.

[Jim Cassedy]

WoW! We're apparently working in very different environments. I'd say 95% of the people showing up at the theater I'm
at have either bought tickets in advance, or use a credit card or phone app to purchase tickets & food items. I can't even
recall ever seeing anyone walk up to the box office & pay cash for a ticket. (But then again, I'm mostly in the booth & not
at the box office - - so it's not likely I"d have seen a cash transaction anyway)
Personally, I rarely carry cash any more. Most of the time I leave the house I don't have a single cent on me. A friend
recently asked me if he could borrow $20, and I wound up having to get it at an ATM because although I do keep an
"emergency cash-stash" at home, I had no denominations less than $50 laying around the house. But, at the theater
I'm at, from what I've observed, very little actual cash changes hands anymore.

[Frank Cox]

I don't take cards. Cash only.

Handing out the extra change isn't any big deal or a problem; I just thought it was interesting that it worked out exactly opposite to what I expected to see.

[Mike Blakesley]

How much cash change we go through is directly correlated to the movie crowd. Older crowd equals more cash change. Middle-aged, or under crowd, they all use credit cards or buy online. Kids used to hand us fistfuls of crumpled up bills… We don’t see that very often anymore. It’s amazing how many of the kids even have cards.

[Harold Hallikainen]

Card vs cash is an interesting comparison from the business side. Using cash, you avoid card fees. But you may lose out on customers that don't carry cash (or enough cash). With cards, you have the fee, but, I think, simpler accounting since the CC company (I think) generates an accounting and dumps the money (less fees) in the bank. How do CC fees compare with the cost of handling cash? I heard at one time that credit card companies would not allow sellers to offer a discount for not using the card, but now I see lower prices for cash purchase of gasoline versus card. So, what is the current card company policy regarding discounts or surcharges? Do the fees compare to cash handling costs? Or are cards accepted just because many customers expect it, and you get more sales.

[Mike Blakesley]

There used to be a rule (I think it was more like a credit card company policy via a contract term) stating that you couldn't charge a fee for using a card or have a cash discount, but I think that must have gone by the wayside because I see businesses all over the place with a "minimum purchase" or a "2% fee" or whatever for using cards.

Personally I see it as a business expense, which makes it a tax deduction, so who cares? You're offering the customers a handy way to spend more money, so what's not to like?

When we switched credit card processors to Heartland, the biggest pain in the nuts was finding out that they deduct their fees from every deposit, as opposed to Worldpay which did their deductions at the end of the month. Plus with Heartland there are two sets of deposits, one for our regular sales and one for sales online or through our app, so that means two sets of fees. I just made an adjustment to the way I enter my deposits on my weekly spreadsheet to include a daily entry for fees and an end-of-week total. So it was a pain, but a temporary one.

[Lyle Romer]

Card vs cash is an interesting comparison from the business side. Using cash, you avoid card fees. But you may lose out on customers that don't carry cash (or enough cash). With cards, you have the fee, but, I think, simpler accounting since the CC company (I think) generates an accounting and dumps the money (less fees) in the bank. How do CC fees compare with the cost of handling cash? I heard at one time that credit card companies would not allow sellers to offer a discount for not using the card, but now I see lower prices for cash purchase of gasoline versus card. So, what is the current card company policy regarding discounts or surcharges? Do the fees compare to cash handling costs? Or are cards accepted just because many customers expect it, and you get more sales.

Also, it's a lot more difficult for an employee to steal off of a credit card transaction than it is with cash. Eons ago when I was an assistant manager for GCC we had several box office workers who were good enough at math to charge adults the adult price but print senior or children's tickets and then pocket the difference of several transactions worth. It got to the point where a manager would become the ticket taker unannounced and then ask people what type of ticket they paid for when an adult would hand over a senior ticket or child ticket.

[Leo Enticknap]

The rules on credit card surcharging and discounting vary from state to state. The situation in California appears to be somewhat unclear, from what I can see online. A law was passed banning surcharging by retailers, but it was challenged in court, which held it to be unconstitutional.

From what I can see, discounting - offering a reduction from the sticker price if a specific payment method is used - is legal, hence many gas stations offering a 10c a gallon discount if you pay with cash. But surcharging - imposing an extra charge on top of the sticker price for paying using a specific method - is illegal in most, but not all cases. Ironically, the last time I encountered a credit card surcharge was at the State of California's very own DMV, which wanted to do me for another 3% if I renewed my registration that way. It offered me the direct deposit option for free, which is what I used.

I'm wondering if the specific legal criterion is payment for services as distinct from goods. Other recent examples I can think of when I encountered credit card surcharges were paying a property tax bill and paying an attorney. In both cases they offered alternative payment methods without a surcharge, and in both cases we took them. I've never encountered any retail outlet selling goods that charges a credit card surcharge, though I do occasionally see one that has a minimum amount for credit card transactions. Presumably they are charged a flat rate per transaction or a percentage, which ever is higher, to process a payment, and the minimum amount is the figure, below which the retailer would lose money on the sale due to the fixed processing fee.

I, too, have wondered how the costs of handling cash compare to those of electronic transactions. There is the time taken to count it and manually create accounting records, and the security costs of getting it to and from the bank. Presumably these costs are lower than the card fees, or else gas stations - including those in the sort of neighborhoods where you need serious security when moving cash around in significant quantities - would not continue to incentivize paying with cash.

[Frank Cox]

I have credit cards that give me a (small) percentage of my purchases as a cash credit on my bill. Therefore I use them everywhere that takes them for everything I can.

If you're paying for something that you were going to be buying anyway, it's free money.

If a place wants to surcharge me for using a card then I pay cash instead of course since it would make little sense to pay a higher percentage surcharge to get a lesser percentage refunded.

[Jack Ondracek]

Legal or not, there appears to be zero enforcement.
Our state taxing agencies charge extra for using credit. Only ACH draws from the bank carry no fees.
We have theatres in our area that charge $.50 additional per ticket for credit purchases.

Personally, I've always been of the opinion that credit charges are just another cost of doing business that should be baked into your overall prices. By playing games with fees and discounts, you're just drawing attention to one small part of your cost-of-services.

[Gordon McLeod]

In Canada all credit card charges the merchant can now pass on to the customer

[Frank Cox]

To a maximum of 1.4%, with 30 days notice to their credit card processor, and by posting a prominent notice to that effect.

The ability to add a surcharge applies only to Visa and Mastercard. It doesn't apply to American Express even though they charge the highest processing fees.

[Leo Enticknap]

I have credit cards that give me a (small) percentage of my purchases as a cash credit on my bill. Therefore I use them everywhere that takes them for everything I can.

If you're paying for something that you were going to be buying anyway, it's free money.

My Amazon credit card gives me points that translate into credit for Amazon purchases, so for the same reason, I use it wherever it's accepted without a surcharge, and pay it off in full at the end of each month. But that is at the root of the controversy about surcharging for credit card use. If, as Jack advocates, card fees are baked into sticker prices, the result is that customers who choose to pay with cash are effectively subsidizing the perks and incentives given to credit card users, thereby inflating the cost of goods and services more generally. An argument could also be made for surcharging on social justice grounds: the current situation disadvantages those who cannot get a credit card due to a poor credit history, because they are forced to subsidize cardholders who are using them for the perks.