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Imagine if you ran a $1B/year business with 10% profit margins and Visa took 2% of revenues. Profit before Visa is $100M, profit after Visa is $80M. If you ne
by Dwolb 8y ago
Imagine if you ran a $1B/year business with 10% profit margins and Visa took 2% of revenues.
Profit before Visa is $100M, profit after Visa is $80M.
If you negotiated Visa’s fees down to 1.5%, profit after Visa would be $85M. This is a 6% improvement in operating profit which is a lot.
- cycrutchfield 8y agoImagine if you ran a $1B/year business with 10% profit margins and 20% of your customers only have one credit card, a Visa. Profit before Visa is $100M, profit after Visa is $80M.
- deleted 8y ago[deleted]
- Dwolb 8y agoI’m not sure I fully understand the point. Is it that people won’t shop at a store if Visa isn’t accepted? If so, I agree that is one of many additional factors in the overall negotiations.