The National Association of Convenience Stores has announced that it will make pumptoppers available free of charge to US retailers, to help them communicate their aggravation over escalating credit card fees to consumers and the Congress.
Pumptoppers typically contain promotional messages about the store but these will communicate the industry’s fight against high interchange rates.
The National Association of Convenience Stores (NACS) is urging retailers to put these pumptoppers in their promotional signage plans from August 1, 2008, to September 6, 2008, when Congress is in recess and members will be in their home districts.
Convenience stores sell an estimated 80% of the US’s gasoline, and around 56% of stores are owned by one-store operators, as opposed to less than 2% that are owned and operated by major oil companies. These stores are reportedly being squeezed by low margins and escalating credit card fees, with most losing money when customers pay by credit card.
In 2007, credit card fees reportedly cost convenience stores $7.6 billion, more than double the convenience store industry’s profits of $3.4 billion. It has been much worse in 2008 as credit card fees have topped $0.10 per gallon, while the markup on a gallon of gas has averaged only $0.11 for 2008 so far.
After factoring in all operating expenses, retailers reportedly lose money on every gallon of gas they sell when a consumer uses a credit card.
The NACS noted that both the House and the Senate have introduced bipartisan legislation, the Credit Card Fair Fee Act, to examine credit card fees, specifically the interchange rate, which is the largest component of the credit card fees that retailers pay every time they accept plastic.