Comments on: Why Do Merchants Dislike American Express?

By: george

george — Fri, 20 Jan 2012 00:25:07 +0000

Why would an honest company make their employees only use AMEX?

I travel for the benefit of my company, not me, why make me hunt down merchants that take AMEX when I’m tired, hungry and out of town?

Think about it.

By: Danny

Danny — Tue, 13 Dec 2011 18:09:31 +0000

One reason merchants don’t like AMEX is that there is a group of people out there that use their American Express card as a tool to get everything free. I recently sold a customer over $4,000.00 worth of bedroom furniture. When the furniture arrived the headboard was damaged. Fine all you have to do is order another one. This was not good enough for this scam artist. He disputed the charges for the entire bedroom because he had to sleep on a mattress and boxspring causing him “extreme duress”. Not only did American Express go along with this bullshit. He also disputed charges when the replacement headboard came saying it took too long. He accepted the merchandise but disputed the charges. American Express for many people is nothing more than a plastic license to steal. The worst thing is AMEX allows them to do this.

By: vj

vj — Sat, 10 Dec 2011 12:43:12 +0000

I can’t speak for other types of businesses, but if you are in a business that does a low profit to volume of sales, like a restaurant/bar, the extra half percent can make a huge difference. For a small mom and pop operation, not taking AMEX can save $2000 or more a year.

By: Banks su.....k

Banks su.....k — Wed, 23 Nov 2011 20:04:37 +0000

American express wants a monthly fee of up to 33$ just to use their service as a mercant. they also want .30 if you have a call in or internet customer. to high. So is paypal to a mercant

By: jd

jd — Thu, 10 Nov 2011 21:30:48 +0000

you can’t charge a different price because of the credit instrument used. That is illegal in most states. So not necessarily dumb merchants, but I agree the half percent difference in most cases shouldn’t stop them from accepting them. They do loose business that way. Some places can charge a convienence fee for all credit used, but it usually has to be the same fee for everyone then.

By: Asdf

Asdf — Wed, 09 Nov 2011 18:24:55 +0000

I think its very dumb for any merchant to not accept AMEX. If AMEX is the only option for me, because my company provides me with only AMEX, you are angering customers like me, and I hope you go out of business. Why just not say “Amex customer will have to pay 2% premium due to AMEX policies. Sorry.”
I’ll be perfectly OK with that. Is it really so hard? I guess if you’re a dumb merchant, then yes.

By: Niknak

Niknak — Sun, 28 Aug 2011 19:54:53 +0000

Paypal charges 3.5% on every AMEX transaction. You must have at least 10k in sales per month to acquire 2.2% per transaction for other credit cards (plus $0.30 per transaction). Then when you get into all of the “specialty” cards where customers are getting milage and whatever else, you are paying high rates for them too with most companies. Paypal is one of the few that charges a simple rate. Our company no longer accepts AMEX cards due to their high fees.

By: Steve NYC

Steve NYC — Wed, 24 Aug 2011 22:52:32 +0000

Our sales are around 1200.00 to 5000.00 per transaction with AMEX. In the last 4 years we had 2 chargebacks back to back. We sent our client signed invoice copies and other proof to support our claim against the chargebacks. One was an unauthorized charge (BS) and the other merchandise issue. We are still waiting for their answer but we are going to sue these cardholders if need be. We are not going to be out this money. We will become their worst nightmare if need be. We are not going to be defrauded. AMEX will be sued as well.

By: Jenna Steel

Jenna Steel — Wed, 24 Aug 2011 01:21:39 +0000

Am Ex DOES take the money out of your account and play the sweeps (see banking policies). Even when they KNOW the merchant is in the right, they still take 90 days to return the money to the merchant when they shouldn’t have stolen it in the first place! Unless Am Ex has changed it’s pre-presentment policy in the last few years, they are still the WORST option for small business. Billing less than 3k a month thru AmEx I had to devote a FULL time person to dealing with their nonsense. In 11 years, i have never lost a chargeback, but people will still try and get out of paying for their items. It costs them nothing to fraudulently lie to AmEx.

In fact, I had a business customer tell me it was company POLICY to do chargebacks on all bills over 5k. He said it cost him nothing and the percentage of bills he didn’t have to pay was over 10% that way.

Why isn’t there even ONE merchant service who favors the merchant anymore?

By: David

David — Thu, 04 Aug 2011 10:12:33 +0000

“well said a customer should be able to pay how they like. A good business plan accounts for all costs be it real or potential when setting prices, credit card fees and other costs of business. ”

I see. So you’re saying that retailers should raise their prices to allow for AMEX’s extortionate business practices thereby increasing prices for other customers so that AMEX customers can get points which are a tiny fraction of the fees AMEX charge. Hard to see how that benefits customers overall.

By: John California

John California — Sun, 24 Jul 2011 04:34:48 +0000

Very interesting discussion. What puzzles me is that there are regional differences, even in the same state, about accepting Amex. Even in cities of about the same size, the more ‘provincial’ ones have more [typically small] business than other more ‘cosmopolitan’ cities’ businesses of about the same time. My hypothesis is that a sort of local ‘urban legend’ takes hold, in which business owners engage in groupthink about excessive charges and the like. Let’s face it, given the spread on the charges, for any business worth its salt [and all the ones I'm talking about here are reasonably good businesses], the differences in costs are chump change.

I don’t have a dog in this fight, but it seems like some people are taking surface streets because they don’t want to pay to go on the faster toll road, and then justifying it with misinformation that they share with one another.

By: Anonymous

Anonymous — Fri, 22 Jul 2011 02:39:58 +0000

Excellent answer, except one quote ‘The profit for the retailer on a $389 net transaction may be 50% ($194.50)’. You’re not wrong, but the post is more tech-talk than business-talk. Most small mom-pop businesses do not make anywhere near 50% due to higher wholesale costs without bulk-buy discounts, 20-30% is more typical, with a 30-day term (to pay the bill). Large corporate chains easily make 50%-100% because they go beyond just bulk-buying. They invest in house-brands for exclusivity, cost-control, and lots of delayed billing (like Macy’s ‘Club Room’ sweaters for $15 using your new Macy’s card, for example). But some businesses (big or small) in weak industries are lucky to just break-even and scrape enough revenue to get employees paid and qualify for another loan, happily offered by Amex & Visa. Credit co’s are crack dealers to both consumers & businesses.

By: Daniel

Daniel — Thu, 14 Jul 2011 04:25:53 +0000

A lot a good info, quick question tho; where did you get your information? Do you have a reputable website you can point me towards?

By: BB

BB — Mon, 04 Jul 2011 02:41:51 +0000

With respect to the above commenter, all forms of payment entail a cost to the retailer. Cash and checks cost the time to deposit and tender them (or have an armored car pick them up for you), so arguing that “charging a fee” doesn’t make sense, well, doesn’t make sense. The card company has to maintain a staff of employees, keep lights on, and maintain secure networks to ward fraud, so these fees help keep the end consumer from paying even more.

By: Mary

Mary — Sun, 26 Jun 2011 23:12:45 +0000

I don’t think any percentage fee to a merchant makes sense. Just because cardholders spend more per transaction then cash payers isn’t a justification for credit card companies to feel they are entitled to a percentage of that retailers profits. The credit card company is making more interest because people bought more stuff.