In the Dec. 28 issue of ProSales' e-newsletter, ProSales Business Update, editor Craig Webb commented on dealers' responses to the rise in pro contractors' use of corporate credit cards: "Some dealers have stopped extending to card-payers the traditional discount for paying the bill by the 10th of the month. Others have stopped accepting American Express but continue to take Visa and MasterCard.

I suspect that many others of you still are trying to weigh how much business you'll lose if you refuse the small-business cards–particularly if the builder sees the use of that card as his way to pay for vacation. How much of a problem is this for you, and what are you doing about it?" Here's what some of you had to say:

Credit cards to pay bills are an increasing problem. ... Our policy is cash, credit card, or company charge at the time of sale. We do allow customers to come by once a week and pay that week's charges with a credit card. Beyond that week, we will not accept cards for payment on accounts.

I just purchased my third GM sales truck using credits from my GM card, so I obviously understand why the customer wants to use the cards. We just tell them to get paid quicker we are willing to give up a discount. If we have to wait until the bill is due to get paid we feel the cost of loaning them that money (that's what accounts receivable really is–a loan) is equal to the discount.

Jim Croome, President
Sandersville Builders Supply, Sandersville, Ga.

It's a major financial problem. We figure it costs us in the neighborhood of $87,000 a year to accommodate our customers' wish of paying their account with a
credit card. This total is growing each year, but the competition offers it so we feel we must, too. We are encouraging the use of debit cards but to no avail.

Ted Risser, President
J.H. Brubaker, Lancaster County, Pa.

To date, we have been very honest with our customers. We tell them the huge cost to us if we were to accept the cards. The result would be the loss of jobs for our office people who take very good care of the customers when they need information about their accounts. To date, everyone I have spoken to understands. Most who ask haven't thought that WE would be paying for their vacation, not American Express. They would have to give up the discount we allow for paying by the 10th and none have taken me up on that offer. I do think this is going to get tougher, as American Express is constantly pushing their promotions, and our competitors, just like with the discounts by the 10th, seem to succumb to pressure. That doesn't make good business sense. We do accept debit cards, as the fee for that transaction has not been a percentage of the sale but a flat fee. We do have to monitor this closely as things change if you are not paying attention. Most good (aka, large) customers don't use debit cards because they want to keep a good paper trail of their payments for accounting and tax purposes.

Eileen C. Miskell, Owner
The Wood Lumber Co. Falmouth, Mass.

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