Paying for Someone Else's Coupon

You clip a manufacturer's coupon for a $1 off a gallon bleach. You go to the store. You select the bleach which is $1.79 and take it with your coupon to the cashier who then subtracts the $1 and the new bill before tax is $0.79.

Who pays for the coupon? The store? No. They electronically capture all the coupons for the month and forward them to Johnson & Johnson or Proctor & Gamble or what have you. Then they get a check for the amount of the coupons that were offered by the manufacturer, and the process repeats. Not the circle of life Elton John sung about, but still the world goes on turning...

However the story changes completely if we change one thing. You go to the store, you buy whatever you buy with no coupons. You go to the cashier. You give them your Sky Miles card, Rewards card, Bonus back card, Cash back card (whatever) and give it to the cashier who rings you up. You get your sky miles, bonus points, cash back, whatever, the company who gave you the card gets all the glory, and who foots the bill? The card company right? After all its their card, kind of like going in their with their coupon right?

Wrong.

The business where you bought your groceries, gas, meal, clothes, crafts, insulin, business supplies and everything else just picked up the check. And they had no choice. If they take Visa and a customer goes in with a Visa rewards card of any type, it cost them substantially more money than if you had a regular card. Why is this? Why is the local burger joint where you go every Saturday about the crack of noon paying for your Delta Sky Miles? If you're using your Delta Sky Miles card shouldn't Delta be picking up the extra?

If you are a business beware. Better yet, be aware. Be aware of where your fees are going. This is not your merchant services group gouging the day lights out of you. It's the deals made with MC-Visa, Discover, and Amex. What's worse if you take Visa at your place of business, you CANNOT turn away a Visa Rewards card without running the risk of being delisted. Delisting means your merchant account just got cut and you can no longer accept credit cards. It is a damning process at best.

Be aware. Know that your business pays for someone else's coupon. Know that your Rewards card punishes businesses you like to shop at. Be aware that people are foolish and make bad decisions that look good for the present and are very bad for the future. We are continuing this trend of punishing businesses by now making Rewards debit cards. The cards that used to save businesses money will soon help tighten a stranglehold.

If you think this is OK, go back and look at the housing market over the last four years. Predatory lending was great for the people doing the lending, but a beast can only be beaten so many times before the back is broken. Forgive the ugly sentiment.

And forgive me for editorializing, but America's businesses have always been the ox that pulled us out of the mud. We can strangle them or reward them. One gets us out; the other drowns the ox with us.