Given that we’re all supposed to use contactless payment wherever possible now, AIBU to think it’s a bit shit to have minimum spend amounts?

[AngeloMysterioso]

I try to use small and independent local businesses wherever possible but I’m getting quite tired of having to meet (sometimes quite high) minimum spend amounts.

Example- lovely local greengrocer, went in for a piece of ginger, £2.40. Minimum spend- £5. I put it back and went to M&S where the same sized bit of ginger was half the price and that was all I had to pay.

This is particularly annoying given that at the moment everyone is encouraged to use contactless or card payments as it is more hygienic than cash. I know there is a fee applied to card payments but surely these independent businesses are going to drive away customers if they insist on passing it on? I really like the greengrocers but I’m not going to waste money on things I don’t need if I’m not getting £5 worth of stuff whenever I go in there- I’ll just go to the supermarket instead.

Just get some cash out.

You won’t be ‘wasting’ it if you keep the change for the next time you need ginger, or a bus fare, or a tip in a cafe etc etc.

Or just go to Marks in the first place.

Trouble is huge businesses like M&S get much cheaper rates on their card processing fees. Independent businesses just don't have the turnover to negotiate these rates :(

I run a small business and my card payment provider (izettle) charges a flat % rather than a per transaction fee. They do have a minimum spend of £1 but it's incredibly rare for a customer to want to spend less than that.

I rarely have cash on me, and I don’t want to withdraw £10 from my account just so I can spend £2.40

But if you ever want to be in the position where you can pay for things by cash, you are going to have to withdraw some at some stage. The alternative is that you limit yourself to big shops where you can pay by card for 1p or otherwise grab extra stuff you don't want to make it up to the minimum in small shops.

The card fees are the killer. A PP said about bank charges for cash, but not all cash transactions have to go through the bank and incur a fee every time, as the cash can just be 'recycled' as change for people spending higher amounts in cash. Also, in small shops where the person/family who own them also run them and it's their main/only source of income, they can take their profits/wages/equivalent out in cash from the till. My parents did that with their shop: in fact, they never actually accepted cards (this was over 20 years ago, mind). Everything went correctly through the books and was all accounted for for official/tax purposes, but instead of pay cash into the bank and incur fees and then later withdraw it and incur more fees, they just put the cash straight into their own pockets and it never went near the bank.

I've seen lots of "cash only" payment signs in shops where I've been in last few years. chippies, sweet shop, bakery...

So they can’t afford to absorb the card charges but they can afford to lose sales?

Yes, pretty much. The amount they'll make on a sale of £2.40 once they take out card charges and all their other overheads is miniscule.

Big businesses can afford to swallow the cost - small ones can't.

I work in a pharmacy. We have a £5 minimum. If we didn't, then we would quite literally be paying people to take stock off the shelves.

We used to charge 20p, for under a fiver, but the law was changed and we are no longer allowed to do that... despite it suiting some customers to do so.

Just looked up the stats - in 2019 only 23% of payments were made using cash and only 2.1 million people (out of 66 million) mainly use cash for their purchases. This is a trend towards cards that has been happening over many years. Interestingly it seems like people are tending to just get cash to hold onto. We too have some emergency cash in the house but don’t use it routinely.

You say they will lose business, but for every customer who walks out, another one will throw in a few quid worth of other things to make up the minimum amount.

YANBU. Smaller businesses need to join the modern world or lose customers.

but I want to support local businesses as much as possible

No you don't. Otherwise you wouldn't be writing what you are writing here

@Nohomemadecandles buy a big bit of ginger, wrap it in foil or stick it in a box or whatever and keep it in the freezer. Grate it frozen straight into whatever you're adding it to.

went in for a piece of ginger, £2.40

£2.40 for a piece of ginger!

Unless it was a massive piece.

YANBU. Smaller businesses need to join the modern world or lose customers.

It's not a case of them 'not joining the modern world'. The card transaction would probably cost THEM more in fees & processing than OP was going to spend.

@whatthejiggeries

I thought they'd changed the rules and it was now illegal to penalise use with a card ?

For customers. That's why no one does "either 5 pounds or pay 50p fee". However, Worldpay and all the providers charge the merchant. Theese things are not free🤷🏻 It's nlt like the customer pays £5 and £5 land in the account of the merchamt...

[quote Namechangeforthis88]@Nohomemadecandles buy a big bit of ginger, wrap it in foil or stick it in a box or whatever and keep it in the freezer. Grate it frozen straight into whatever you're adding it to.[/quote]
Eh? I was commenting on the price of OPs ginger!

I don’t use the local corner shops where I live because they both have a £10 minimum spend for card payments and I haven’t carried cash around for about ten years.

Just looked up the stats - in 2019 only 23% of payments were made using cash and only 2.1 million people (out of 66 million) mainly use cash for their purchases. This is a trend towards cards that has been happening over many years.

Although more and more people are indeed favouring card/phone payments in shops, surely the figure also has to be massively skewed by online purchasing, where it simply isn't an option to use cash if you prefer.

I don’t use our village shop for this reason. Instead I drive the five minutes to the co-op in the next village. I’m not the only one either; they’d do far more business if they didn’t have the minimum charge. I haven’t used cash since lockdown 1, at all. Don’t even take a bag anywhere, just my phone.

Insane that you would DRIVE to the next village instead of keeping a kitty of fivers and pound coins in a purse.

I'd rather use cash for small amounts.

I don't think some people quite understand the costs of running businesses and processing money. Insisting that 'surely they'd rather just make a small amount rather than lose the sale altogether?' is pointless when, as a PP says, it costs them money to make and process that sale - not just a dent out of their profits but actually having to pay merchant fees of more than any profit there was to have - before you even add in the cost of overheads.

Even without the issue of card payments, I remember reading some time back about a shop owner who had a corner/convenience shop right next to a very busy central bus station. Everybody thought he was coining it in, with all the passing trade; but he had a huge problem, as the buses were 'exact fare only' (i.e. forfeit any excess) and there was no change machine provided.

He had to pay the bank for change for the float - and actually take time to go to the bank to fetch it - and then he was inundated by bus travellers wanting him to swap a note for change. When he started insisting on a purchase before giving change, lots of people would find the cheapest thing they possibly could (a single sweet or Freddo or something), give him a £20 note and then take all of his change, which he had to keep going to the bank and replacing, at further cost to himself.

When he introduced a minimum purchase value - even for cash - there were bitter complaints (not a few of them racist) from people saying that he didn't deserve to stay in business, he was greedy, he should be glad of all custom, as 'it all mounts up' (presumably even that which costs him more than he makes) etc.

I don’t use our village shop for this reason. Instead I drive the five minutes to the co-op in the next village. I’m not the only one either; they’d do far more business if they didn’t have the minimum charge. I haven’t used cash since lockdown 1, at all. Don’t even take a bag anywhere, just my phone.

Unfortunately, they simply can't afford not to 'lose' that business. If you sold an item that cost you £10 to buy and a long stream of people expected to pay you £9 each for them, you wouldn't want all of that 'business' either.

It sounds counterintuitive, but the busier they would be on those terms, the poorer they'd actually end up and the sooner the shop would close down for good.

It favours the big players and the banking system.
For the sake of small business pay cash.

I rarely use my card and pay cash in most places. You should always have some cash on you, small businesses can’t afford the charges.