Dear Editor,
I appreciate Wes Hamilton’s perspective on credit card fees in his recent letter to VTDigger, but I take issue with framing these as costs that must be passed separately to customers rather than simply as another cost of doing business.
Like many local restaurants, Three Penny Taproom uses the Toast point-of-sale system. Toast charges 2.49%-3.69% per transaction, depending on the plan, in addition to a set monthly fee. While accepting credit cards may feel unavoidable in today’s market, choosing Toast specifically — and its pricing structure — is absolutely a business decision. Toast even promotes using surcharge features to help restaurants shift these costs to diners.
The alternative to using a card and avoiding paying a fee is paying in cash. But the reality is that cash also incurs costs for the business. Having worked at a business handling large cash volumes, I can attest that cash comes with significant hidden costs: counterfeit detection, theft prevention, safes, armored transport, bank deposits, and labor for counting and reconciliation.
Hamilton says, “Nearly every transaction runs through a card now.” If that’s true, why not simply raise menu prices by 3% to cover this universal cost? Restaurants could offer a cash discount to the minority paying that way. We don’t see separate line items for rent, utilities, insurance or kitchen equipment, all unavoidable costs of doing business. Why should payment processing be different?
I’m increasingly frustrated by restaurants showing a $40 menu price, then adding 4% for kitchen staff, 3% for credit cards, plus expecting 20% for service. That’s $50.80 for a “$40” meal. This drip pricing approach obscures the true cost and creates a poor customer experience. Determine your total cost to serve a meal, and price it accordingly on the menu.
Michael Charter
Jericho, Vt.
