Advantage to Cash-in-Hand vs. credit card purchase?

[53flyer]

Ok, so I’m wondering how big a difference (if any) people think “cash in hand” vs. a credit card actually makes to a retailer when negotiating a price (primarily on big purchases). I'm getting close to going shopping and I have a general belief that if you don’t negotiate the price that you pay too much so I’ll be looking for a fair deal for both of us (seller and myself). I'm just trying to decide if I think it would be worth it to go with cash vs. just using a credit card. I already know this isn't the greatest part of the yr to find "deals" but one retailer is actually having a 20-30% sale on their wood stoves right now but they carry the Lennox brand and I haven't really been looking at Lennox. Besides, a "sale" price is just another negotiated discount price between seller and buyer. Just without the negotiations... :cheese:

Any former &/or current retailers (regardless of the retail item) willing to chime in?

Thanks

 

[BrotherBart]

Sure I will chime in. Be willing to tell the seller what you will pay for the item. In cash. Don't do the the "What will you take for it if I pay cash?" bit. Tell him and then be ready to pony up if they say "OK.".

Bet ya can't do it. :coolgrin:

 

[theheatelement]

I just did this on another purchase they wanted $3,5xx he offered 10% off I offered $3,000 cash he took 2,950... His cc fees probably would have been $90

 

[WYOmom]

The actual fee that a merchant pays to accept credit cards varies, but a general rule of thumb is that the fee is about 2% of the purchase. AS I am sure you know, Some items have a higher retail mark up than other items - I do not know the retail mark up on stoves.
Personally I would not expect a much larger discount than that for paying cash on a stove/fireplace itself.

 

[branchburner]

Are you looking, or are you buying? To retailers, the cash itself isn't the big deal. What it supposedly says to them is that you are a buyer, not a looker, and the deal is ready to be done if they can close it. But don't expect to beat them up for too much more than they were already set to be beat up for. Of course, you don't know what that amount is.

You don't really need a wad of cash to work a deal. But don't count on bluffing unless you play more cards than they do. Personally, I would use a credit card for the security of having a month or two to charge back in the event of a problem. Getting a prompt cash refund can be tough.

 

[thinkxingu]

Mornin',
I was a home theatre salesman for a while and I learned quite a few things:

1. For the most part, chains don't care about cash/credit card--they cannot 'hide' anything and do so much business, 2% doesn't matter.
2. As branchburner said, it's about the buyin' not the negotiatin'. You'd be better off offering an amount with a definitive date: "I can swing $X; can you get it done by Y?
3. Small shops can 'hide' stuff like labor, accessories, etc. If you want a deal, you'll have a better chance there.
4. Make sure the store knows you have shopped lots of places (always go to your favorite last) and know what things cost, and then use the line below:
5. "I was hoping to make this my last stop. I've gotten X for a quote, but if you can do Y price and install by Z, I'm sold."

This last line is the best selling line of all time--it indicates what it will take for you to pop, that you're legit, and a price you think is reasonable after having done your homework.

S

PS There's a zillion 'closes' in the sales biz (alternative, install, trial, delivery, direct, etc. etc.)--if you can beat the salesman to it, you've won. Ex. There is the install close: "When would you like to have that installed?" In this line, the salesman presumes he has sold the piece and that it's a matter of time--good customers know these things to get what they want.

 

[btuser]

There are plenty of jerks who walk into stores thinking their money is magic and they were born with a 10% off birthmark on their forehead. I'm one of those jerks, but I try not to insult people. I also don't expect a deal on heaters in November or a deal on air conditioners in June. The time to insult and cajole for a new stove is Spring not late Fall / early Winter.

I do however, confess to the guilty pleasure of heckling people who post unrealistic sales on Craigslist.

 

[daryl]

Cash in hand helps seal a deal.In our shop if you want just a stove nothing else cash and carry you can get between 10 and 15 percent off depending on stove.
Some stoves we buy at a better margin,or have had one in stock for a long time. You might get 20% on something like that.
If you want a whole system installed we can do some off the pipe also but not on the labor.
On the other hand nothing kills a deal faster than when you give someone a fair price with discounts. And they only want more $ off.
Those type of customers only end up being a pain in the @#$ anyway.

 

[devinsdad]

maybe off topic but when we went shopping for our stove in September the dealer told us up front that they would be cheaper in March and also the floor models which they burn would be a 'great deal' then. He also gave us 15% off all the pipe and accessories. delivered and set the stove in place. We had cash in form of debit card from checking acct but he didn't know until it came time to pay up.

 

[daryl]

maybe off topic but when we went shopping for our stove in September the dealer told us up front that they would be cheaper in March and also the floor models which they burn would be a 'great deal' then. He also gave us 15% off all the pipe and accessories. delivered and set the stove in place. We had cash in form of debit card from checking acct but he didn't know until it came time to pay up.

That is why we write out a proposal for all sales and installs with terms of payments.
You just screwed your dealer out of 2% of the sale. As said before pain in the @#$.
Sorry if that offended anybody.

 

[devinsdad]

how may I ask did I screw him out of 2% when checks visa mc discover etc are accepted.

 

[daryl]

The retailer gets charged around 2% just too swipe that card with a visa logo on it.It doesnt matter if its debit card or credit card.

 

[devinsdad]

maybe they are being screwed by the card companies but I still pay what I pay . If that is such a problem maybe they should toss their card swiper and signs saying credit card accepted into the stove. In no way am I screwing anyone and if that was an issue maybe "will this be cash or credit? " would be a good thing to ask before making offers .

 

[btuser]

Those type of customers only end up being a pain in the @#$ anyway.

One time I was working in a person's yard and I broke a branch on a bush. The person sued for $5000.00 (3' rodidendron) but settled for replacement of the bush after 18 months and 3 court appointments. When I was done replacing the bush I was told by the customer it wasn't big enough, because the old bush would have been bigger by now if I hadn't broken the branch. He told me he wouldn't consider suing again for satisfaction if I were to agree to plant the old bush (which was still thriving) in another area of his property. I said no, at which point he told me I had to leave the bush because it was his property, along with the dirt still clinging to the root ball. I told him to sue for this one, because it was going in my yard where I could piss on it every night when I let my dog out.

I got a call 8 months later telling me the new plant had died, and he wanted it replaced again.

 

[daryl]

The OP wated to know if cash made any difference. Well yes it does.

 

[CarbonNeutral]

I got 15% off my stove as part of a promotion, but you had to pay with cash/check.

 

[grommal]

The flip side is the extra buyer protection that comes with a credit card purchase. If you buy a product that does not function properly and the merchant blows you off, most credit cards will go to bat for you. I had mine shove a dysfunctional computer back into a merchant's face one time. Saved me from having a $3000 doorstop.

 

[blades]

credit cards cost merchant anywhere from 1.5 to 3% of the sale, additionally there is a line item charge which can be 25 cents per line. Then depending on who issued the card or if it is a debit card there might be an additional handling fee. Also there is a statement fee each month, typically $10. There might also be a an equipment fee, either rental or maintenance, it could also be called a association or account maintenance fee typically $100 to $150 a year. Plastic is the major source of revenue for the banks. Even more so since congress delayed the the fair credit act by ten months allowing the banking industry to crank up all the fees and interest rates as high as possible. Almost forgot there is an additional fee if your card is used internationally. One more thing every year the merchant has to be checked for security protocol, you guessed it another fee, generally $60 or more. The merchant does receive some discounts on these fees based on annual volume. At my shop it costs me about $40 a month to offer credit card convenience to my customers. Some of my customers are state schools or large corporations and for them small purchases, say under $2,000, are better handled with credit cards due to the cost or time required to issue a purchase order. As Paul Harvey used to say, the rest of the story.

 

[grommal]

credit cards cost merchant anywhere from 1.5 to 3% of the sale, additionally there is a line item charge which can be 25 cents per line. Then depending on who issued the card or if it is a debit card there might be an additional handling fee. Also there is a statement fee each month, typically $10. There might also be a an equipment fee, either rental or maintenance, it could also be called a association or account maintenance fee typically $100 to $150 a year. Plastic is the major source of revenue for the banks. Even more so since congress delayed the the fair credit act by ten months allowing the banking industry to crank up all the fees and interest rates as high as possible. Almost forgot there is an additional fee if your card is used internationally. One more thing every year the merchant has to be checked for security protocol, you guessed it another fee, generally $60 or more. The merchant does receive some discounts on these fees based on annual volume. At my shop it costs me about $40 a month to offer credit card convenience to my customers. Some of my customers are state schools or large corporations and for them small purchases, say under $2,000, are better handled with credit cards due to the cost or time required to issue a purchase order. As Paul Harvey used to say, the rest of the story.

Then again, my card cost me zero per year, as long as I pay the balance in full. It gives me 5% back on gas, groceries, and pharmacy purchases. It gives me 1% back on everything else (including a woodstove). The stove shop did not flinch at me using a card, even after we went back and forth on the price a few times. Could I have negotiated a slightly lower price for a cash transaction? Perhaps. But it would have to be more than 1% less to break even, and that's before considering the buyer protection benefits. To me, it was a no brainer.

That's the rest of the story from my perspective.

 

[Fsappo]

If someone offers to pay cash or check instead of credit I'll take off 1%. It saves me the 2% cc fees. If I do this on 15 sales a year at $3500 average, thats $525 at the end of the year on the income statement. Add that to all the other things a small business person can do, pay balances early to get a 1-2% discount, etc, those small amounts add up to a few thousand dollars at the end of a year.

 

[Fsappo]

Another thing I've noticed from 25 years of retail sales. The folks who say "Whats the best deal for cash if I take it right now" will in MOST cases take your best price and you'll never see them again. I doubt they had the cash in their pockets to begin with and even if I told them 50% off for the stove for cash they would still say "well i have to talk to the wife, I'll be back tomorrow I promise, should I ask for you? What time do you open?" Then you see them 6 months later asking for repair help on their big box store stove.

When ever I hear, "whats your best deal for cash" in the majority of cases I figure on not seeing that person again.

Now, funny this topic showed up. I am in the process of buying a used SUV for my wife. I wanted to save up $5K so I could just buy one outright. She wanted to go shopping before we had the money (this week should be the week) I told her I wanted to wait until I had 5k in my pocket. I know a lot of auto dealerships like to finance instead, so they can get their bank kickbacks, but I like the feeling of having the cash, so when I say "What if I paid cash right now" and the salesperson accepts the deal, I dont look like an idiot. I plunk down the money and the deal is done.

 

[blades]

Got to get a trailer for skid steer- cash is king in that world. Looks like it will have to be a new one though as everyone seems to have misplaced the title (anything over 3500GVW requires a lic. here).

 

[Fsappo]

I'm not allowed to drive a skid steer in Warren County since the "incident"

 

[53flyer]

...tell the seller what you will pay for the item. In cash. Don't do the the "What will you take for it if I pay cash?" bit. Tell him and then be ready to pony up if they say "OK.". Bet ya can't do it.

Bet I can’t do what? Offer a fair price I’m willing to pay in cash or get a better deal from a store? I paid $8000 for our last used car and it was in cold hard cash. That car actually went up in value btw which is a very nice feeling although unrelated.

I just did this on another purchase they wanted $3,5xx he offered 10% off I offered $3,000 cash he took 2,950... His cc fees probably would have been $90

You offered $3K and he took “even less” than that? Wow, it’s not very common for the seller to come in “below” your offer price. LOL

 

[53flyer]

The actual fee that a merchant pays to accept credit cards varies, but a general rule of thumb is that the fee is about 2% of the purchase. AS I am sure you know, Some items have a higher retail mark up than other items - I do not know the retail mark up on stoves.
Personally I would not expect a much larger discount than that for paying cash on a stove/fireplace itself.

So you’d be perfectly happy with a 2% discount “regardless” of the initial mark up? Ex: A $1000 (store cost) item is marked up marked up A) 10% to $1100 or B) 100% to $2000. I’d be surprised if you are basically saying you’d be happy (not expect better than) paying A) $1078 OR B) $1960 for the same item… The rub is you often won’t know the mark up but you can get a "descent" idea by observing store-wide sales (not item-by-item sales). A store that offers 30-40% product-wide sales is generally doing initial mark ups far greater than a store that never/rarely has a sale greater than 10%.