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Pay In Cash and Get A Deal, Part 2 Supermarket Valet Parking Can You Trust Free Antivirus Software? Contacting pcAmerica
Pay In Cash and Get A Deal, Part 2
In Newsletter #330, I wrote about a trend of several restaurants and retail stores that are offering a cash discount. Specifically, I mentioned Luigi’s Trattoria in Framingham MA that was offering a 20% discount to cash customers.
The restaurant using this tactic states that 80% to 85% of its customers used to use credit cards. After offering the discount, the percentage of credit card users dropped to 20% to 25%.
I received lots of emails from newsletter readers complaining about the process with several readers surprised that I would recommend such a tactic.
Read my lips!!! I never recommended nor do I recommend that any retailer offer a 20% discount or any cash discount to customers who pay by cash.
I did say, “Anyhow...the concept is taking off and you may want to think about it.”
The information actually came from The National Restaurant Association SmartBrief Newsletter:
And a recent article published by The Detroit Free Press:
http://www.freep.com/article/20090809/COL20/908090346 /1115/ENT05/Pay-with-cash-and-you-could-get-a-meal-deal
More articles are available by searching Google news for the words RESTAURANT CASH DISCOUNT.
So here is my opinion (which has not changed). I would not recommend that any restaurant offer a cash discount. I think it is an interesting concept to think about and read about, but I would not recommend it for lots of reasons.
As I mentioned in Newsletter #330, it is probably against your merchant agreement with your credit card processor (but you need to check that out with your credit card processor). It may be against your local, state or municipality laws. It may overly alert IRS agents that your restaurant may not be reporting all of your income.
Any discounts that you offer to a certain group of customers (cash customers) may eventually come back to haunt you. Many businesses need to pay by credit card. Many of your best customers who freely spend money on a credit card may not be too happy that they are actually overpaying compared to cash customers. Your credit card users will probably start complaining about the discount and also demand that same discount.
Going back to the 1950’s, credit card usage was very rare. For better or worse, credit cards have helped to build the economy and make it much easier for consumers to make purchases. When I started my business back in 1976, I did not accept credit cards. All payments needed to be made by cash or check. My business increased by 75% as soon as I started accepting credit cards. I’m not sure that it would be easy to go backwards and cease credit card acceptance.
Having a 20% off sale makes it difficult to go back. A high percentage of people only buy from department stores when they have a sale. People wait for holiday sales before buying many items. Car dealerships have offered $4,500 cash for clunker deals. It went over real great, but watch car sales in the upcoming weeks. If it isn’t on sale, people are not going to buy it.
Once you offer a 20% cash discount, it is real difficult to turn back. You are getting your customers to rely on a sale price. Department stores and many retail stores are now stuck. People don’t buy unless it is on sale.
So no, I don’t recommend that you offer a 20% discount. It is interesting to read about. It is interesting to think about, but I don’t think it is a great idea.
The best way to get money out of customers is to have great service, great products, and a good value for the price paid. Starbucks (whether you like them or not) has the reputation of offering a great cup of coffee and a unique experience to its customers that are willing to pay a little more for. Many customers flock to Macy’s to buy name brand shirts at a 25% discount. Many of those customers end up buying more expensive shirts that they believe to be superior in quality and that offer a better fashion statement.
Use your discounting smartly and sparingly.
Supermarket Valet Parking
Here’s an interesting article that you may want to read. In order to compete better with two other local supermarkets, a Shoprite supermarket decided to offer customers free valet parking.
No one wants it.
The local Stop & Shop countered by marketing the value that it gives to its customers. Do you want value? or do you want someone to park your car?
Read the interesting little article that shows how some ideas just don’t work:
http://www.silive.com/news/index.ssf/2009/08/staten_island
Can Your Trust Free Antivirus Software?
Those of you who read the newsletter know that I highly recommend Norton Internet Security 2009 (a Symantec product). I believe that it is the best available product for the majority of small business owners, home computer owners, and students. pcAmerica uses Symantec’s corporate edition. It is a great product for larger businesses. I also acknowledged that FREE AVG is pretty good and probably 95% as good as Norton.
Many business owners and newsletter readers use the FREE AVG. As I pointed out, although you may be using it and not paying for it, small businesses should be paying for it (at least according to the license agreement).
But, the question is, is a FREE product such as AVG as good as a paid product such as Norton Internet Security 2009?
The question is answered in an article published August 24, 2009 in PC World Magazine. In short, the FREE products don’t work quite as well as the paid product. It’s very difficult to define “don’t work quite as well.” I arbitrarily say that the FREE STUFF is 95% as effective as the PAID STUFF. Personally, I pay $69 per year for Norton Internet Security 2009. Actually, I normally get it for FREE by buying it from Staples who offers frequent upgrade and rebate discounts (about four times per year). I use AVG on one of my laptops that I use for testing. I haven’t gotten a virus or spyware on it yet.
Read the article and make your own decision. Go to:
http://www.pcworld.com/article/170587/can_you_trust_free_antivirus
PC World recommends Avira as the best FREE Antivirus/Antispyware product. AVG (extremely popular) is ranked #3. Most important is that your computer must be protected. If you want my opinion, buy Norton Internet Security 2009. If you don’t want to spend any money, don’t read too many emails, and don’t use the internet so much, then try one of the FREE products.
Contacting pcAmerica
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For more information on Cash Register Express, Asset Management Software, Portable and Wireless Point of Sale, barcode readers, cash drawers and receipt printers, call PC America at 1-800-PC-AMERICA or 1-800-722-6374 or 1-845-920-0800. You may also purchase directly on the internet at www.pcamerica.com or email PC America at newsletter@pcamerica.com.
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