Square’s Fee Increase Isn’t Great News for Coffee Shops or Their Customers

September 27, 2019 Admin 0 Comments

Plus, plastic teabags leach a lot of microplastics, and more news to start your day

Square pricing change could negatively impact your favorite coffee shop

Square, the financial services and mobile payment company whose swiveling white stands are commonly found in hip coffee shops, is making a change to its payment processing rate that could majorly impact small businesses. Starting November 1 for existing clients, and immediately for new ones, Square will charge merchants 2.6 percent plus 10 cents for each tapped, dipped, and swiped credit card transaction, instead of the 2.75 percent it’s been since 2011, the company announced in a recent blog post. While this may not sound like a huge difference, adding a fixed charge of 10 cents means a significant price hike for small businesses with a high volume of transactions, but lower average transaction values — in other words, places like coffee shops.

Per coffee news site Sprudge:

As an example, on a $5 transaction for your favorite cappuccino, Square would take $.14 in their old pricing model. Under the new model, they will take $.23, which is just under a 67% increase. In fact, in order for a business to not see a rate increase, their credit card sales would have to average $66.67 per swipe.

This pricing update will almost certainly help Square increase its margin among smaller merchants, as the Motley Fool writes, but for patrons of independent coffee shops and other small businesses, two possible scenarios are likely: expect either to see the price of your latte go up, or to watch your favorite cafe fight harder to stay afloat.

And in other news…

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• Researchers considered what food could be part of a self-sufficient system feeding a colony of one million people on Mars. The answer includes insects and lab-grown meat. [The Takeout]
• The CEO of Impossible Foods had some harsh words about his fake-meat competitors. [Business Insider]
• A woman had to go to the hospital after downing a whole ball of wasabi, thinking it was avocado. Incidentally, Eater’s pop culture editor Greg Morabito points out, this also happened in the Whoopi Goldberg/Ted Danson rom-com Made in America. [People]
• Domino’s Australia is hiring a one-day “chief garlic bread taste tester” in a move that seems designed to be no more than an elaborate PR stunt. [LinkedIn]
• Bobby Flay and Seth Meyers make game day dips together on Late Night. [YouTube]
• Looks like René Redzepi is up to some stuff!

• All AM Intel Coverage [E]