Roberta, Dorothy, and I went out to dinner at the Red House Cafe tonight. We were a bit surprised to see a big sign saying,  

“As of January 1’st we will no longer be accepting Credit Cards. Cash and Local Checks only.”

This got us to talking about why a business would not accept Credit Cards. Especially a restaurant. Then I started to do the math. The Red House Cafe is fairly small, with only about 12 tables and 2 waitresses.  So, 12 tables, breakfast lunch and dinner. Let’s say 2-3 seatings per meal, round that to 60 seatings a day on average. Say 80% of people, or so pay with a credit card. Round that to 50 a day to be simple.

Average credit card charge to the business is $1.50 to $4 per transaction. We’ll round low, again for simplicity, say $2 per transaction, times 50 transactions per day. or $100 per day in transaction fees, or about $3000 per month in just credit card transaction fees.

For a small business, that bloody adds up in a hurry. $3000 a month or about $35,000 a year for a small busy restaurant. In nothing but fees.  Even if they take a small drop in business by only accepting cash, heck, they’ll probably make money in the process.

So, I kind of expect a growing rebellion against credit card acceptance from small businesses. Who can blame them really? It’s outrageous.

FYI. The Redhouse Cafe gets 4 1/2 stars out of 5 on yelp from almost 250 reviews. It’s a darn good little place to have a meal. I don’t think they’ll take a drop in business because they no longer take Credit Cards.