Phone credit surcharge

blackbelt

Not too sure if there is/was a thread on this but whats the deal with a "service charge" on top of phone credit?Wow,are some people expected to pay extra for the person pressing a few buttons?

Could this not be deemed as touting ie selling a product/service above its face value.Afterall,if you buy 10 euro credit why are some customers expected to buy 10 euro worth for 10.50.I've noticed this in the city centre particularly.

Surely Comreg or the Minister for Communication should put an end to this?

Beano

is it not the phone companies themselves that increased the price paid by shops? Some shops just decided to pass the increase on to their customers instead of taking a cut in profits. Simple answer is to buy inplaces that only charge face value.

January

It's a product that stores sell, so they charge a surcharge to cover their overheards. Some shops don't do this. Buy from them if it bothers you.

Cabaal

Nothing to do with the phone companys, just greeding shops
Vote with your feet and get credit from shops that don't charge extra for a top-up, or just use a ATM or on-line banking top-up

mcaul

Cabaal wrote: »

Nothing to do with the phone companys, just greeding shops
Vote with your feet and get credit from shops that don't charge extra for a top-up, or just use a ATM or on-line banking top-up

If I were still in retail, i wouldn't do these top ups as they are no longer profitable in any way for retailers.

Banks charge .5% for cash lodgements, Laser costs 20c per transaction & credit cards cost 2.5% of transaction.

Phoine companies give retailers 5% handling fee (reduced about 2 years ago from 7.5%) Rent, Rates, Sevice Charges, Staff, ESB etc etc... - Easy to see no profit unless you are doing large volume.

Spud83

Phone companies used to give a commision to shops based on the amount of credit the sold. However the stopped this once they realisied that the need to pay the shops. So some shops added a surcharge to the phone credit so the could continue making there money, while some didn't. The ones that didn't where happy with the extra people it would bring into their shop and maybe buy something and happy to keep providing the service, the ones that added the surcharge a greedy and dont deserve anyones custom.

chrislad

I don't see how it qualifies as greedy. They wanted to keep earning the same level of cash that they were. No one likes getting a pay cut.

Gillo

chrislad wrote: »

I don't see how it qualifies as greedy. They wanted to keep earning the same level of cash that they were. No one likes getting a pay cut.

Very true. And as it's been said there are plenty of places that do not charge a surcharge.

Colonel Sanders

mcaul wrote: »

..they are no longer profitable in any way for retailers.

then exit the market, don't rip the customer off. Most places I have seen surcharges charged are in overpriced small shops. they are already blatantly ripping people off in other areas so on the assumption that the average customer will not JUST buy his/her phone credit a cross subsidy will apply. If shops feel the phone compnaies are ripping them off they should think of that when they have the cheek to charge 95c for a bag of crisps (as one newsagent tried to charge me not so long ago).

I work in insurance, there are certain sectors of the market the company I work doesn't feel we can make money in, we don't sell products in these sectors.

FindingNemo

mcaul wrote: »

If I were still in retail, i wouldn't do these top ups as they are no longer profitable in any way for retailers.

Banks charge .5% for cash lodgements, Laser costs 20c per transaction & credit cards cost 2.5% of transaction.

Phoine companies give retailers 5% handling fee (reduced about 2 years ago from 7.5%) Rent, Rates, Sevice Charges, Staff, ESB etc etc... - Easy to see no profit unless you are doing large volume.

This is true but it still brings customers into the shops,
and the majority of people won't JUST get phone credit, they'd get bars/lotto/paper/cigs etc etc.

Padraig Mor

mcaul wrote: »

Phoine companies give retailers 5% handling fee .

Virtually all of which they keep as net profit as it costs them SFA to provide the service.

This whole practice arose several years ago when one of the companies dropped the commission on credit. Shops then added a surcharge to make up the difference. However, in most cases the surcharge was greater than the shortfall in commission. Robbing bastards.

ScouseMouse

Cabaal wrote: »

Nothing to do with the phone companys, just greeding shops
Vote with your feet and get credit from shops that don't charge extra for a top-up, or just use a ATM or on-line banking top-up

Listen Cabaal, greedy shops as you describe is wrong. Vodafone started it by increasing the price of a 10 euro topup to the shops by about 40c. So its costs went from 9.00 to 9.40. The rest went up be ABOUT the same margin. I dont have the exact figures so dont argue over a cent or two. Some shops - including my own - passed this on to the customers. It is unreasonable of you to call me greedy when all I am doing is maintaining the status quo. The person getting the extra profit is vodafone. This amounts to a pay cut for the shops so vodafone can feck off. Anyone thats wants to complain in my shop is given the vodafone phone number. We didnt start this.

It is true that if you dont like it, go elsewhere, but where can the shop go?

An alternative supplier? Vodafone is Vodafone !!

dudara

Take it easy everyone, there's no need for a slanging match here.

tippbhoy

Padraig Mor wrote: »

Virtually all of which they keep as net profit as it costs them SFA to provide the service.

This whole practice arose several years ago when one of the companies dropped the commission on credit. Shops then added a surcharge to make up the difference. However, in most cases the surcharge was greater than the shortfall in commission. Robbing bastards.

Who pays for the phone line rental? Who pays for the terminal purchase or rental, who pays for the staff to hand out the product. Who pays for the rates to have a shop there to provide the service

I don't see how this is SFA of a cost. The reality of this is the store provide a service for a price they see fit. If you are not happy with the price you do not pay it and you go elsewhere. The is the premise of competition on which our entire economy is founded on. Some people on here expect something for nothing or very little even when they couldn't be bothered going elsewhere. Law of supply and demand, we're fueling the rip off culture ourselves.

For the record, I wouldn't pay it, i use online banking. If nobody payed for it they wouldn't continue to charge it. Convenience is the service and people are accepting it, it's not like this is a monopoly situation. Basic economics.

Colonel Sanders

tippbhoy wrote: »

If you are not happy with the price you do not pay it and you go elsewhere.

likewise if you are not happy with the commission withdraw the product from your shop.

Padraig Mor

tippbhoy wrote: »

Who pays for the phone line rental?

Presumably the shop is paying for phone line rental anyway?

tippbhoy wrote: »

Who pays for the terminal purchase or rental

The phone company IIRC

tippbhoy wrote: »

who pays for the staff to hand out the product.

The staff will be paid to be there anyway

tippbhoy wrote: »

Who pays for the rates to have a shop there to provide the service

They'll be paying rates regardless of whether they sell credit or not.

Listen, if shops wanted to raise their prices to make up the shortfall, so be it. Raising prices even further (as most seem to have done), to *increase* their profit, is just gouging.

Sam Vimes

alanmurphy83 wrote: »

Phone companies used to give a commision to shops based on the amount of credit the sold. However the stopped this once they realisied that the need to pay the shops. So some shops added a surcharge to the phone credit so the could continue making there money, while some didn't. The ones that didn't where happy with the extra people it would bring into their shop and maybe buy something and happy to keep providing the service, the ones that added the surcharge a greedy and dont deserve anyones custom.

say a wholesaler sells a shop a bottle of coke for 80c and the shop charges a euro. this is business.

if the wholesaler then increases the wholesale price to 90c, is the shop greedy by increasing their price by the same amount?


credit is a product like any other and shops are not obliged to sell it at a loss (when staff and electricity costs are taken into account) because the networks increased the price. if anybody is greedy here its the networks for decreasing the commission given to the shops.


having said that, i would never buy a top up from a shop that charged the surcharge. i do text top up

ScouseMouse

Commander Vimes

I compliment you on some common sense in what you said. When I saw what Cabaal posted about shops being greedy, I saw red. He obviously doesnt know what he is talking about on this issue and I had to put the record straight. However, is it appropriate for some who is obviously opinionated to be a moderator on boards !!!!

chrislad

Tsch, he just make a longer post on my point

tippbhoy

Padraig Mor wrote: »

Presumably the shop is paying for phone line rental anyway?

The phone company IIRC

The staff will be paid to be there anyway

They'll be paying rates regardless of whether they sell credit or not.

Listen, if shops wanted to raise their prices to make up the shortfall, so be it. Raising prices even further (as most seem to have done), to *increase* their profit, is just gouging.

the shop will often have a dedicated line to this, they cannot expect to provide a service when someone is on the phone in the office. That's at least 250 quid a year for 1 line.

The phone company do not pay for the terminal in many instances, why do you think some stores only have 1 terminal even if it makes sense to have one on each till.

Regarding the points that they are paying the fixed costs anyway, it is pointless having a discussion on it if this is the best you can muster to strengthen your argument. While we're at it why aren't sandwiches cheaper, the staff would be there anyway twiddling their thumbs and would be only delighted to pass the time :rolleyes:

Tails142

Colonel Sanders wrote: »

then exit the market, don't rip the customer off. Most places I have seen surcharges charged are in overpriced small shops. they are already blatantly ripping people off in other areas so on the assumption that the average customer will not JUST buy his/her phone credit a cross subsidy will apply. If shops feel the phone compnaies are ripping them off they should think of that when they have the cheek to charge 95c for a bag of crisps (as one newsagent tried to charge me not so long ago).

I work in insurance, there are certain sectors of the market the company I work doesn't feel we can make money in, we don't sell products in these sectors.

oh please!! someone in the insurance industry preaching about ripping customers off. They must have learnt all their tricks from your industry... lol

Excuse my while I life my ass off at the irony....

tippbhoy

Colonel Sanders wrote: »

likewise if you are not happy with the commission withdraw the product from your shop.

this is an alternative option of course, however it is then one less service that would be available to the consumer so either way the retailer will lose on this one unless the margin is corrected via a surcharge.

I'll repeat i think this was an unwise move on the part of some retailers due to the adverse publicity it has generated. For some to call them greedy is unfair, you'd swear people didn't have a choice.

Padraig Mor

tippbhoy wrote: »

it is pointless having a discussion on it if this is the best you can muster to strengthen your argument. :

Nope the best I could muster was "Listen, if shops wanted to raise their prices to make up the shortfall, so be it. Raising prices even further (as most seem to have done), to *increase* their profit, is just gouging.". You've conveniently ignored this twice now. You presumably agree with blatant price gouging so?

ScouseMouse

But we are not increasing our profit - we are just staying as we always were !!!!

Padraig Mor

superscouse wrote: »

But we are not increasing our profit - we are just staying as we always were !!!!

Maybe you are. But there's plenty of reports of shops who are not.

Noelie

Shops actually loose money seeling the top-up. for a shop to cover costs they need to be making an average of about 20% profit. this is to cover staff costs bill rent and cost of the product.
Groceries will average about 30-35% while top-up, cigerettes, lotto and bus tickets all make about 5-7%.

The shop is providing a service which is not making it money but sells the products to entice the costumer into the shop. It actually takes more resources to sell the top-up than it does to sell the more profitable groceries.

The way the phone companies see it is that they can sell their credit online or at ATM's, where there is very little operating costs so the service providers i.e. the banks, are happy to make an extra 7%. they then decided why should the give the retailer 10% so each shop was told the commision was going down like it or lump it.

There would be more up roar if the shops didn't sell the credit as people would be saving they don't have access to the net or an ATM. so it's a lose lose situation for shops.

tippbhoy

Padraig Mor wrote: »

Nope the best I could muster was "Listen, if shops wanted to raise their prices to make up the shortfall, so be it. Raising prices even further (as most seem to have done), to *increase* their profit, is just gouging.". You've conveniently ignored this twice now. You presumably agree with blatant price gouging so?

This is all relative, they may maintain the same margin percent but at the same time make more margin. In other words they now make more money in monetary terms but the percentage return from the outlay is the same.

The store has made more money but this is the case for any price increase that takes effect on any product in the store and rightly so as they have a higher outlay hence a higher risk. Is this "increasing" the profit... the term profit can be very ambiguous, in monetary terms yes, in more relative terms no.

No i do not agree that it is "gouging". I think it was an ill advised move due to the type of product and adverse reaction from the public but it is justifiable, the average consumer would not relate credit to any other product when there is in fact absolutely no difference.The simple reason i wouldn't pay it is because i can get it cheaper elsewhere doh!

if a store sells a mars bar for 80c and another for 75c, is the first one ripping off the customer and is greedy. The immediate answer is yes, the more infomed answer would be possibly yes or no as there are many factors to be considered.

Colonel Sanders

Tails142 wrote: »

oh please!! someone in the insurance industry preaching about ripping customers off. They must have learnt all their tricks from your industry... lol

Excuse my while I life my ass off at the irony....

irony? why. Proof of rip offs please?

and I'd like PROOF, not hearsay and speculation. there is no way the insurance industry can be accused of making excessive profits. Look at return on capital figures over the last 5-6 years. They are in no way out of line with other industries and lag behind many.

tippbhoy

tippbhoy wrote: »

This is all relative, they may maintain the same margin percent but at the same time make more margin. In other words they now make more money in monetary terms but the percentage return from the outlay is the same.

The store has made more money but this is the case for any price increase that takes effect on any product in the store and rightly so as they have a higher outlay hence a higher risk. Is this "increasing" the profit... the term profit can be very ambiguous, in monetary terms yes, in more relative terms no.

No i do not agree that it is "gouging". I think it was an ill advised move due to the type of product and adverse reaction from the public but it is justifiable, the average consumer would not relate credit to any other product when there is in fact absolutely no difference.The simple reason i wouldn't pay it is because i can get it cheaper elsewhere doh!

if a store sells a mars bar for 80c and another for 75c, is the first one ripping off the customer and is greedy. The immediate answer is yes, the more infomed answer would be possibly yes or no as there are many factors to be considered.

Just to re-iterate my point, someone correct my maths if necessary but i think this is about correct. I'll use the term widgets as usual.

Product A
Cost -1.00
Sell - 1.20
Profit margin - 20

Profit Margin %
(1.20-1.00)/120 * 100/1 = 16.67 % margin

Product A increases in cost by 5c
Cost 1.05
Sell 1.28
Margin - 23

Profit Margin %
(1.26-1.05)/1.26 * 100/1 = 16.67 % margin


In notional terms i am no better off

MOH

tippbhoy wrote: »

Just to re-iterate my point, someone correct my maths if necessary but i think this is about correct. I'll use the term widgets as usual.

Product A
Cost -1.00
Sell - 1.20
Profit margin - 20

Profit Margin %
(1.20-1.00)/120 * 100/1 = 16.67 % margin

Product A increases in cost by 5c
Cost 1.05
Sell 1.28
Margin - 23

Profit Margin %
(1.26-1.05)/1.26 * 100/1 = 16.67 % margin


In notional terms i am no better off

Think you moved the goalposts a bit there

ScouseMouse

No, I dont think he did. He calculated the margin as of the selling price rather than the cost price. It is obvious he is in the trade as this is the proper way to calculate the margin. What shops do is calculate the profit against takings.

tippbhoy

MOH wrote: »

Think you moved the goalposts a bit there

Sorry you are right, i'd been playing around with the sell price in the calculation to make sure i maintained the same margin but never changed it in the example, my mistake.

the calculation is still correct however.

Product A increases in cost by 5c
Cost 1.05
Sell 1.26
Margin - 21

Profit Margin %
(1.26-1.05)/1.26 * 100/1 = 16.67 % margin

parsi

Colonel Sanders wrote: »

irony? why. Proof of rip offs please?

and I'd like PROOF, not hearsay and speculation. there is no way the insurance industry can be accused of making excessive profits. Look at return on capital figures over the last 5-6 years. They are in no way out of line with other industries and lag behind many.

One example would be the wide divergence in motor insurance quotes. I always ring Quinn Direct for the laugh so that I can get a >1k quote and then go to the others for a more reasonable quote. For me over the last 4-5 years the rates from high to low are: Quinn, Eagle Star, Axa & Hibernian (the latter two are usually close).

That to me is very like shops which have rip-off prices when compared to shops that charge less eg the shop that charges a whopping surcharge and the one that charges little or no surcharge.

foggy_lad

some shops in carlow are ripping people off to the tune of €22 for €20 top-up! these top-ups should be sold at face value and why is it almost impossible to get a receipt from most small shops including centras londis vivo etc etc

tippbhoy

foggy_lad wrote: »

some shops in carlow are ripping people off to the tune of €22 for €20 top-up! these top-ups should be sold at face value and why is it almost impossible to get a receipt from most small shops including centras londis vivo etc etc

you are entitled by law to get a receipt on demand. i've never come across a case of somewhere that can't produce when you ask, they can write a receipt if required.


what is face value. if you buy a ticket on ticekmaster, do you pay face value?

Sam Vimes

foggy_lad wrote: »

some shops in carlow are ripping people off to the tune of €22 for €20 top-up! these top-ups should be sold at face value and why is it almost impossible to get a receipt from most small shops including centras londis vivo etc etc

did you read the thread at all?

Colonel Sanders

parsi wrote: »

One example would be the wide divergence in motor insurance quotes. I always ring Quinn Direct for the laugh so that I can get a >1k quote and then go to the others for a more reasonable quote. For me over the last 4-5 years the rates from high to low are: Quinn, Eagle Star, Axa & Hibernian (the latter two are usually close).

That to me is very like shops which have rip-off prices when compared to shops that charge less eg the shop that charges a whopping surcharge and the one that charges little or no surcharge.

some companies quote high prices to customers in order to remove large numbers of similar risks from their books (i.e. they will not want 100 of their motor book to be drivers aged 30-35 or all their household exposure to be located in the same town). Its a means of risk management, not a means of ripping someone off.

Also different companies have different experience for the factors they rate on. For example I know Hibernian load household policies in Finglas (no idea why, I don't work for them). This would infer that they percieve Finglas as being a riskier are than the likes of allianz and axa do and charge accordingly.

tippbhoy

Colonel Sanders wrote: »

some companies quote high prices to customers in order to remove large numbers of similar risks from their books (i.e. they will not want 100 of their motor book to be drivers aged 30-35 or all their household exposure to be located in the same town). Its a means of risk management, not a means of ripping someone off.

Also different companies have different experience for the factors they rate on. For example I know Hibernian load household policies in Finglas (no idea why, I don't work for them). This would infer that they percieve Finglas as being a riskier are than the likes of allianz and axa do and charge accordingly.

well that clears that up anyway, this "factual" non subjective way of analysing risk in the insurance industry is the reason for such variations in pricing until i tell them i'm getting it cheaper elsewhere.
Never any smokescreen for making abnormal profits

Colonel Sanders

tippbhoy wrote: »

Never any smokescreen for making abnormal profits

I repeat the profits insurance companies have made even in the last few years have by no means been 'abnormal' compared to the amount of capital needed to support their balance sheets. Compare them with other industries to see that.

People seem to forget that insurance companies are businesses. Massive amounts of capital must be provided from share holders to support their business and this capital needs to be serviced in order for these share holders not to f*ck off elsewhere with their cash.

Btw what is your definition of abnormal?

tippbhoy

Colonel Sanders wrote: »

I repeat the profits insurance companies have made even in the last few years have by no means been 'abnormal' compared to the amount of capital needed to support their balance sheets. Compare them with other industries to see that.

People seem to forget that insurance companies are businesses. Massive amounts of capital must be provided from share holders to support their business and this capital needs to be serviced in order for these share holders not to f*ck off elsewhere with their cash.

Btw what is your definition of abnormal?

Are you not being a bit hypocritical talking about how insurance is a business to justify your statements yet slating other businesses regarding charging more for phone credit

Regarding abnormal profits in the insurance industry, i'm no expert in this area but i found it very hard to understand in the litigious era we have been in in the past few years that profits continued to rise across the industry. I would call this abnormal. I have no hard facts to support what I'll admit is more perception based opinion but perhaps you may like to detail the figures from your industry to back your statement?

Colonel Sanders

tippbhoy wrote: »

Are you not being a bit hypocritical talking about how insurance is a business to justify your statements yet slating other businesses regarding charging more for phone credit

Regarding abnormal profits in the insurance industry, i'm no expert in this area but i found it very hard to understand in the litigious era we have been in in the past few years that profits continued to rise across the industry. I would call this abnormal. I have no hard facts to support what I'll admit is more perception based opinion but perhaps you may like to detail the figures from your industry to back your statement?

My statement was that if you are not happy with the money being paid to you to provide a service then withdraw the facility to provide that service. I know well enough that shops etc are busineses and need to make profits. It is unrealistic to assume insurers will exit the market completely when rates soften and profitability falls (this would be like me advising you to close your shop over the surcharge issue) but they have been know to withdraw from sectors when the business model makes no sense. For example Hibernian withdrew from the motorcycle insurance market a few years back as they were unhappy with legislation re. pillion passengers and the company I work for adopted a 'barge pole' approach to young drivers after their last forray into that market resulted in large losses across their total motor book (not just their young driver segment).

I can't post specific details from my company accounts as I'd lose my job but have a look at any copy of the insurance statistical review (the old blue book), everything you need is in there.

The thing i was trying to get across is that looking at absolute profits is not a means to say whether they are 'abnormal' or not. The return on capital and target return on capital from your parent company are the important figures.

In terms of excessive would you consider 50m a year profits from a company with a 9-10% market share as excessive? The reality is if a company with about 10% of the market makes 'only' 50m in profits its quite likely the CEO would lose his job (I'm assuming 500-600m in capital is needed to support this firms balance sheet). If profits dropped any lower its quite likely the parent company would sell the Irish operation. The return required on that type of capital employed to keep everyone happy would be anywhere between 60-100m depending on the company (different companies use different target returns.

In terms on profits increasing, the capacity of the market increases each year as more cars are on the road needing insurance, more companies are in operation needing insurance and profits are retained by companies adding to the capital that is needed to be serviced. Also notall companies profits are rising. We are near the soft end of the insurance cycle and rates are, in some cases, idiotic and completely unsustainable. For example my company lost a couple of large commercial policies despite quoting 'break even' premiums (i.e. 0% profit/expense loading)

Premiums are at their lowest level since around 01/02. The PIAB has had a positive effect on liability claims amounts.

Also up to before Sept 11th many insurance companies could made losses of writing insurance but more than compensate with investment returns. This is no longer the case putting more pressure on the underwriting profits. Increased solvency requirements have pushed up the amount of capital finanacial companies need to hold increasing the required abolute levels of profits.

Just to warn you in advance current rates are unprofitable and unsustainable so be prepared for the market to harden and premiums to increase late next year at the very latest.

ScouseMouse

Just a recap, vodafone increased the price to the shops of a phone credit a few years ago. Some shops (mine included), passed it on to the customer as a surcharge. Hence 10 euro credit now costs 10.50. (some shops I said, - some shops decided to accept the pay cut). Well O2 and meteor followed suit.

No increases for the last year or two and now this week Meteor increased the cost of a 10 euro credit to the shops (including mine) by another 12 cent approx.

So expect more surcharges folks !! This affects all retailer who use the Alphyra system but it will probably be across the board.


Queries to meteor customer care.

I dont want to hear it.

thefinalstage

superscouse wrote: »

Just a recap, vodafone increased the price to the shops of a phone credit a few years ago. Some shops (mine included), passed it on to the customer as a surcharge. Hence 10 euro credit now costs 10.50. (some shops I said, - some shops decided to accept the pay cut). Well O2 and meteor followed suit.

No increases for the last year or two and now this week Meteor increased the cost of a 10 euro credit to the shops (including mine) by another 12 cent approx.

So expect more surcharges folks !! This affects all retailer who use the Alphyra system but it will probably be across the board.


Queries to meteor customer care.

I dont want to hear it.

Damn. I mean you are obviously making a profit selling them even without the surcharge so why add it? Either pure greed or staff "training" costs.

Apparently your don't want to hear it :rolleyes:.

ScouseMouse

thelastangryman wrote: »

Damn. I mean you are obviously making a profit selling them even without the surcharge so why add it? Either pure greed or staff "training" costs.

Apparently your don't want to hear it :rolleyes:.

With this increase, my margin will drop to somewhere around 5%. That isnt enough to pay the staff member. Remember this is being triggered by the phone company who is making millions. I am maintaining the status quo.

JohnC.

If it isn't making any money, why not stop providing the service?

thefinalstage

superscouse wrote: »

With this increase, my margin will drop to somewhere around 5%. That isnt enough to pay the staff member. Remember this is being triggered by the phone company who is making millions. I am maintaining the status quo.

Five percent for hitting three keys on a screen? Nice work. 25c per each five euro phone credit bought and thats without a surcharge.

jahalpin

thelastangryman wrote: »

Five percent for hitting three keys on a screen? Nice work. 25c per each five euro phone credit bought and thats without a surcharge.

Out of the five percent you have to pay phone charges to collect credit, electiricty,rent,interest, rates, staff costs, insurance etc. You also have to pay for terminal rental and paper used. The credit is normally paid for by direct debit when the product is recieved.

The marginal cost for the phone companies for providing the service is quite low and they are therefore the ones that are being greedy by reducing the margin on the product.

If shops stopped selling the top-up because of the low margin people would also be complaining that the shop does not provide what they are looking for.

By all means but from the ATM's as they don't charge commisson, the banks can do this because the ATM system is already avaliable and is only another option on the menu, the banks also make money in other ways for example providing account services for the phone companies and selling their product is another reason for the phone companies to use one bank over another.

thefinalstage

jahalpin wrote: »

Out of the five percent you have to pay phone charges to collect credit, electiricty,rent,interest, rates, staff costs, insurance etc. You also have to pay for terminal rental and paper used. The credit is normally paid for by direct debit when the product is recieved.

The marginal cost for the phone companies for providing the service is quite low and they are therefore the ones that are being greedy by reducing the margin on the product.

If shops stopped selling the top-up because of the low margin people would also be complaining that the shop does not provide what they are looking for.

By all means but from the ATM's as they don't charge commisson, the banks can do this because the ATM system is already avaliable and is only another option on the menu, the banks also make money in other ways for example providing account services for the phone companies and selling their product is another reason for the phone companies to use one bank over another.

Do shops only sell credit now or something? Paper is and terminal rental are the only real costs out of what you mentioned. Terminal rental is a fixed cost and the paper is quite cheap plus it can be subject to economy of scale.
Still just greed to be honest. If its such a bother don't stock it at all or is it bringing in extra business?

ScouseMouse

Just remember folks, it is METEOR who have done this. Feel free to question them and if they deny it, pm me so I can call them liars.

The reason I continue to sell it is that things are so tight now that every little bit helps. When this attempted pay cut is imposed on me, I hit back with a surcharge. It is a free country and if you are not happy paying it - go elsewhere. Just like the old one this afternoon, who called my staff member an extortionist. I was in the shop behind her dressed in civvies, I told her if she didn't want it, then fair enough, but no more insults. She carried on so I put her out.

ScouseMouse

thelastangryman wrote: »

Five percent for hitting three keys on a screen? Nice work. 25c per each five euro phone credit bought and thats without a surcharge.

Try telling that to my bank manager who is looking at mortgage repayments of 8000 euro PER MONTH and now my rates increase to 800 euro PER WEEK

Noelie

thelastangryman wrote: »

Do shops only sell credit now or something? Paper is and terminal rental are the only real costs out of what you mentioned. Terminal rental is a fixed cost and the paper is quite cheap plus it can be subject to economy of scale.
Still just greed to be honest. If its such a bother don't stock it at all or is it bringing in extra business?

Ok put it this way say you sell a 20euro credit every 2 minutes for an hour, that's 30*20 = 600, if you are making a 5% profit that gives 30 profit the employees wage will be about 8 euro so that leaves 22 euro. out of this comes all the stores overheads it doesn't leave much much profit.