| Supply and Demand | | | | or Home Depot, they are offered a myriad of |
| As consumers race through the checkout lines of their | | | | discounts and promotional programs as incentives for |
| local coffee shops, discount centers or home | | | | making future purchases. Even consumers who have |
| improvement superstores, one buying habit stands out. | | | | the money to pay for a product or service |
| The way in which people pay for goods and services | | | | out-of-pocket will still take the time to sign up for a |
| has been overtaken by the 'plastic revolution'. | | | | card to receive a discount now and pay their bill later. |
| Consumers are converting from 'cash customers' to | | | | The Truth Hurts |
| 'card customers' in record numbers as our consumer | | | | However, few car wash dealers can afford to |
| driven economy is flooded with private label credit | | | | privatize their own credit card or spend money on |
| cards and gift cards available in nearly any | | | | equipment that only provides the convenience of using |
| denomination. | | | | a credit card at their individual car wash. The problem |
| Accepting credit cards was once a luxury few | | | | that nearly every operator runs into when they order a |
| businesses could afford. But in today's fast-paced | | | | credit card acceptance system is that they don't see |
| marketplace businesses can no longer afford not to | | | | a huge rise in revenues to offset the cost of the |
| accept credit cards or ignore the growing population of | | | | system. Often times the addition of a straight credit |
| card-carrying consumers who have made it very clear | | | | card system only prevents an eventual loss in |
| that obtaining their business is now dependent on the | | | | revenues, because other wash locations that do offer |
| ability to use their cards. This shift in consumer | | | | national credit cards absorb a percentage of the car |
| purchasing power has pushed nearly every industry | | | | washes' business. |
| into joining the 'paying with plastic' mainstream. | | | | Many operators have also noticed that a large portion |
| Accepting Credit Cards Does Not Come Without Its | | | | of their credit card sales is from customers who would |
| Risks | | | | have used cash had the credit option not been |
| As a result of credit cards being offered nearly | | | | available. When a wash installs a credit card system |
| everywhere, we, the consumers, possess a greater | | | | throughout a wash, it does nothing to promote loyalty, |
| freedom in how and where we can spend our money. | | | | only convenience to the growing population of those |
| However, as the benefits for the consumer increase | | | | who prefer to pay with a credit card. |
| so do the risks associated for the businesses that | | | | The Solution is Simple |
| accept them. Fraudulent credit card claims | | | | Enterprising car wash owners who wish to capture |
| skyrocketed to $678 million in 2004. Nearly 80% of the | | | | the business of the card-carriers and still keep them |
| claims associated with stolen credit cards and fees | | | | and the rest of their cash customers coming back for |
| associated with insufficient funds could be prevented if | | | | repeat business is to utilize the best of both worlds - |
| more businesses made use of the latest in credit card | | | | alternate payment methods. Major retailers have been |
| clearing technologies. Some businesses within the car | | | | offering gift cards for a decade now and the sale of |
| wash industry are now taking advantage of this new | | | | gift cards has risen to the top selling item in the holiday |
| technology by using merchant processors that | | | | seasons of 2003 and 2004. |
| authorize their transactions via the web on a | | | | Nearly every person in the United States has used a |
| high-speed Internet connection. So what used to take | | | | gift card with a prepaid balance that could be |
| almost 40 seconds and an additional phone line now | | | | redeemed for products and services. There are also |
| takes 3-5 seconds. | | | | products and equipment available within the car wash |
| This new way of authorizing credit card transactions | | | | industry that can sell prepaid cards/keys/or codes |
| also means there is no need to clear all of the | | | | through a machine that accepts both cash and credit |
| transactions at the end of the day like most of the | | | | cards. This type of system caters to both the impulse |
| batching systems currently used in the wash industry. | | | | buyer and the bargain shopper by offering loyalty |
| Not only do dealers save money on costly business | | | | benefits for prepaying. These benefits can vary - |
| phone lines that the older technologies require, but they | | | | bonus wash dollars or discounts on services, for |
| also reduce the risks associated with accepting stolen | | | | example. In addition, this type of system can convert a |
| credit cards and the bank fees associated with them. | | | | single credit card transaction into a card or key that |
| Buyer Beware: Half-Hearted Solutions Do More Harm | | | | can now be redeemed without transaction fees or the |
| than Good | | | | need for cash, tokens or paper vouchers on future |
| Car wash owners must be aware of drawbacks to | | | | purchases. Many of these systems also allow the end |
| any credit card solution they implement. If a wash does | | | | user to add more value to their card/key/code through |
| not currently have credit card acceptance, a common | | | | the same dispensing machine or even on their |
| solution to implement is a credit card to token machine. | | | | computers via the Internet. |
| On paper this solution seems to cut the cost of | | | | Doing Your Homework: Work Smarter, Not Harder |
| retrofitting existing equipment in the bays or on an | | | | While researching this type of credit card-compatible |
| entry system. It is the unforeseen costs involved with | | | | loyalty system, it is important to ask the following |
| credit card fraud that have relegated this solution to a | | | | questions that may not come up in the sales pitch: |
| last resort. In hindsight, many owners point out that by | | | | - Can I deactivate a card/key/code that is fraudulently |
| giving thieves the ability to use a stolen credit card at a | | | | purchased with a stolen credit card? |
| token machine, they can easily empty all the | | | | - Does the system track which card/key/code is sold |
| untraceable tokens without even resorting to breaking | | | | with each transaction? |
| anything. Not only are the car wash operators out | | | | - Is there a limit to the number of cards/keys/codes |
| hundreds of dollars worth of tokens, but now the bank | | | | that can be in the system at any given time? |
| wants to collect money and charge back fees. Local | | | | - Does the system offer post-paid fleet accounts as |
| Police claim that many times thieves sell the stolen | | | | well as pre-paid gift card sales? |
| tokens to innocent people who then redeem them for | | | | - How is the transaction data stored/retrieved? Is this |
| wash services. So now owners are out the cost of | | | | automated or does it require on-site visits? |
| the tokens, liable for the charges made on the stolen | | | | - Is the transaction data backed up in the event of |
| card and supplying free washes that were never paid | | | | hardware failure? |
| for. | | | | - Does the system batch the credit card transactions? |
| There is a solution for owners and operators to | | | | - Does the system require additional phone lines to |
| protect themselves from this type of theft. Either limit | | | | clear credit cards? |
| the credit card purchases to a one-time service such | | | | - How much do the loyalty cards/keys cost per unit? |
| as the use of a wash bay or be sure that your | | | | What about customization? |
| vending unit is dispensing something that can be | | | | - How does the system handle upgrades and feature |
| tracked and deactivated in the event of fraud. | | | | adds? Do I need to pay for these upgrades? |
| Offering Credit Cards Is No Longer Enough | | | | - How flexible is the system in terms of offering |
| With the rampant proliferation of credit card | | | | discounts or running promotions? |
| acceptance throughout the business world, car wash | | | | - How much development has been done to enhance |
| owners face a dilemma. They are forced to offer | | | | the system since it launched and are there future plans |
| credit cards at their car washes in order to compete, | | | | to continue innovation on the product? |
| but credit card theft and fraud can eat into their profit | | | | Alternate Payment Methods: Opportunity for Success |
| margins and cause time consuming paperwork to | | | | Many car wash owners and operators have found |
| unsnarl. | | | | that the costs associated with purchasing an alternate |
| "Visa It's Anywhere You Want to Be(TM)" | | | | payment program can be daunting, although the long |
| One solution to the problem and an excellent incentive | | | | term gains heavily outweigh the upfront costs. Some |
| to retain customers is private label credit cards. Private | | | | car wash owners decide that they have enough |
| label cards and loyalty discounts have become one of | | | | business and only wish to appeal to the one-time sales |
| the most successful marketing programs in the retail | | | | associated with credit card use at the bay. |
| industry. When consumers shop at their local Best Buy | | | | |