# Do you offer a Cash Discount ?



## Lin19687 (May 20, 2018)

Just curious for those that take CC's.
Do you offer a Cash discount ? 
Maybe buy 4 get 1 free?
CC payments are roughly $0.14 to $0.22 per bar and when you add in Sales tax and such....


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## DeeAnna (May 20, 2018)

Short answer -- no, I don't.

One big reason is simplicity -- I keep the rules of selling at shows and fairs as simple and easy as possible to avoid misunderstandings and mistakes.

If you do offer a discount for cash (which in most people's minds also includes checks), bear in mind the time needed to handle checks and the security concerns about cash and checks at a fair or show. Don't forget the hassle required if you have to collect on even one bad check -- or the loss of income if you cannot collect. In my experience, the CC fees are annoying, but checks and cash have their downsides too, so I don't see a lot of point to different pricing structures for cash/check vs CC.

"Buy 4, get 1 free" as a discount for cash doesn't make mathematical sense. Most discounts for cash that people offer are on the order of around 5%. That would be more like "buy 19 and get 1 free."

Also sales tax is sales tax whether the purchase is cash/check or CC.

If I wanted to offer a volume discount, I'd offer it to everyone.


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## cmzaha (May 20, 2018)

My only difference is I charge tax with the CC and I absorb the tax when they pay cash. I will not absorb the fee and tax for CC transactions. I do take checks and have been very fortunate to have never received a bad one.  I include the tax because I also like to keep in simple and not deal with coins. Granted the tax is higher than card fees but it works for me... I also do not sell just B&B products, my crochet hats really balance out the profit margin since the profit margin is much higher on my hats.


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## amd (May 21, 2018)

I don't do a cash discount, but I do a bulk discount for in person sales - buy 5 get the 6th one free. I should charge for cc fees but I don't. In my rinky dink neck of the woods I lost sales because people didn't want to pay that fee. I price my soaps assuming that I will be paying sales tax and cc fees on each soap + the x4 for profit. Funny, those people that complain about paying fee, don't complain about the price if they don't know they are paying the fee.


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## Lin19687 (May 21, 2018)

Thanks, I wasn't sure if people did that.  Kind of like there are some gas stations around here that still do that.
My example of the free bar was just the only thing that popped into my head.
We have sales tax here of 6.25%, I was just going to list the price of soap with tax included.

Still looking into the card readers and how that all works. 
https://www.business.org/software/p...dit-card-reader-apps-for-your-small-business/
seems to be good info.
And this one too https://www.merchantmaverick.com/the-best-credit-card-reader-for-your-small-business/


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## earlene (May 22, 2018)

Yeah, that thing about the credit card fees is interesting.  I balk at paying more for using a credit card than for cash at a gas station because I know the major gas companies don't like gas stations to do that.  If everybody did that, there would be no reason for people to get the gas company's credit card and that's not good for business (for the credit card company.)  So the fees are hidden in the cost of the product in most cases and of course then the cash customer is also paying the hidden fee as well because it is 'discriminatory' to make such offers.  

In my recollection, when the major credit cards started out, they really wanted people to view them as 'the same as cash' so the 'cash discount' was discouraged.  But over time, I have begun to see it making a come-back all over the country.  I do know there are some folks who prefer to pay for everything with cash, but I also know there are some situations where cash is not accepted at all.  On the airplane, if you want to buy food or drinks, it's plastic only, no cash is accepted.  For me, I don't want to carry that much cash with me.  If I spend $40.00 at the gas station twice a day, I won't have much left for the grocery store as I travel on my roadtrips.  I'd have to stop at the bank as often as I stop at gas stations!


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## shunt2011 (May 22, 2018)

I don't offer a discount for cash.  I offer multiples discounts.   4 for or 3 for type things.


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## cerelife (May 23, 2018)

cmzaha said:


> My only difference is I charge tax with the CC and I absorb the tax when they pay cash. I will not absorb the fee and tax for CC transactions. I do take checks and have been very fortunate to have never received a bad one.  I include the tax because I also like to keep in simple and not deal with coins.


Same here for the same reasons. I don't charge tax for cash sales because it's easier and faster to have whole dollar amounts. I have the sales taxes percentages programmed into my CC reader for the areas where I sell, and tax is automatically added to the total. I do tell my customers that tax will be added for CC transactions and I've never yet had anyone have a problem with this. And just something to keep in mind - some festivals prohibit vendors from charging a 'service fee' for using CC's, but adding sales tax is perfectly acceptable.
I use Square for my CC transactions and I really like them. No monthly fees, so you only get charged per your transactions and the fees are reasonable. I've also found that they are very fast on transferring funds, usually within 24 hours even on holidays.


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## lizzysoap (May 30, 2018)

Lin19687 do you mind me asking where you are at, the only reason I ask is because our sales tax here is 9.98% it is ridiculous. And they just issued another bond that is going to raise it above 10% next year.


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## Lin19687 (May 30, 2018)

Massachusetts, says on my Avatar 
Sales tax is 6.25%


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## madison (May 30, 2018)

lizzysoap said:


> Lin19687 do you mind me asking where you are at, the only reason I ask is because our sales tax here is 9.98% it is ridiculous. And they just issued another bond that is going to raise it above 10% next year.


 10 % is too much.


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## cmzaha (May 30, 2018)

Our sales tax is over 9% in most counties in So Cal


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## Misschief (May 30, 2018)

We have two taxes... GST (Goods & Services Tax) of 5% and PST (Provincial Sales Tax) of 7%, for a total of 12%. That said, GST is not charged on everything (i.e. not on food items).


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## amd (May 30, 2018)

In South Dakota we also have a Tourism Tax - most craft shows/festivals are considered "tourist" activities (by the state) so I usually have to pay an additional 2.5% tax... our taxes can range anywhere from 3% to 7%.


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## DeeAnna (May 30, 2018)

Lin19687 said:


> Massachusetts, says on my Avatar
> Sales tax is 6.25%



Local and other types of taxes often increase that, sometimes by quite a bit, so a person can't just look up the state sales tax to get a definitive answer.

For example, my state of Iowa has a 6% state sales tax, but the counties can charge another 1% local tax. I believe all counties in Iowa do happen to collect the local tax, it isn't strictly required that all must do that.


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## NsMar42111 (May 30, 2018)

Florida is the same, state tax is 6% but my county adds .5% to that


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## Lin19687 (May 30, 2018)

MA just has one tax


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## cerelife (May 31, 2018)

In Louisiana, I have to pay both state and parish sales tax which ups the total to at least 9%.


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## shunt2011 (May 31, 2018)

In Michigan it's a straight up 6%.    I have found that many states with higher sales taxes don't pay state taxes.  Texas & Missouri are a couple.


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## amd (May 31, 2018)

Yep. I think the point is to be aware of what taxes you have to pay, and figure out how you're going pay them - e.g. collect at the time of sale or price so that paying the tax out of pocket (so to speak) doesn't affect your profitability.


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## madison (Jun 1, 2018)

cerelife said:


> I use Square for my CC transactions and I really like them. No monthly fees, so you only get charged per your transactions and the fees are reasonable.


someone mentioned yesterday that Square charges 2.5 % for every transaction. I thought that was a lot.


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## cmzaha (Jun 1, 2018)

madison said:


> someone mentioned yesterday that Square charges 2.5 % for every transaction. I thought that was a lot.


But how much is it going to cost going through a bank for CC service. I for one do not mind the fee, since I do not have to pay a monthly fee. Banks charge quite high fees that are not feasible for the small market seller and in my opinion Square offers quite a lot of services for their 2.5% fee.


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## madison (Jun 1, 2018)

cmzaha said:


> I do take checks and have been very fortunate to have never received a bad one


How do you  know the bad check?



cmzaha said:


> But how much is it going to cost going through a bank for CC service. I for one do not mind the fee, since I do not have to pay a monthly fee. Banks charge quite high fees that are not feasible for the small market seller and in my opinion Square offers quite a lot of services for their 2.5% fee.


It's good to know, thank you for the information.


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## amd (Jun 1, 2018)

madison said:


> How do you  know the bad check?



The bank returns it to you - and charges you a fee. It is then your responsibility to try and collect the money and the returned check fee from the buyer.



madison said:


> someone mentioned yesterday that Square charges 2.5 % for every transaction. I thought that was a lot.



Not really. I mean, if I had the choice between losing a $20 sale and a potential repeat customer or losing the 50 cent transaction fee... I'll pay the transaction fee, thank you very much.


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## Lin19687 (Jun 1, 2018)

Square is 2.75% and if you key in the numbers it is like 3.5% + $0.30 
I think worth it after I did the numbers.  I too will add in Tax for CC payments but not on cash.
my Sq is on it's way, got my Tax ID number and will get a Biz banking account and register the Biz with my town next week.
I will not take checks, MAYBE for an elderly lady who seem to be the only ones that use checks now a days. But mostly not... and I would probably give the soap to an elderly person


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## shunt2011 (Jun 1, 2018)

I too take checks and have never had one returned. I would rather pay the 2.75% then lose a sale.  I’ve gotten many purchases because I take credit.


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