December 11, 2012 11:50 ET
TORONTO, ONTARIO--(Marketwire - Dec. 11, 2012) - Canada's independent petroleum marketers need a break from high credit card fees. The Canadian Independent Petroleum Marketers Association (CIPMA) is asking Visa to rethink its proposed fee increase. At a time when retailers are struggling and banks and credit card companies are posting record profits, Visa recently advised retail merchants that it will be increasing the already high fees they charge to process a credit card payment AND adding yet another higher cost 'Premium card' to an already crowded credit card marketplace.
Independent petroleum marketers who sell and distribute close to 25% of retail gasoline in Canada, operate on very thin and generally stable margins. "Credit card fees are calculated as a percentage of the total amount of the sale, so as gas prices increase and more and more higher cost premium cards are introduced, our members are getting hit twice," says Tricia Anderson, President of CIPMA. Anderson notes that on a credit card sale, the independent petroleum marketer is currently paying over 1/3 of their total operating margin to credit card companies such as Visa merely to process a payment. From the balance, independent marketers must pay all other operating costs including salaries, benefits, facilities rent, utilities, taxes, maintenance and capital improvements. One CIPMA member noted that: "Visa is taking home more from our business than our family is. And we are the people putting the investment, time and energy into running the business."
Independent petroleum marketers also bear the brunt of paying for credit card fees on taxes they collect for government. The average tax on gasoline has increased significantly since 2009. On an average transaction, a retailer pays over 40 cents simply to cover credit card fees on taxes that they collect.
Over 40% of all retail fuel purchases at CIPMA members' sites are done by credit cards.
CIPMA is a national, not-for-profit trade association representing the unique interests of independent, (i.e. non-refiner) marketers of petroleum products. Independent petroleum marketers are small and medium sized enterprises whose success is built on solid business practices and strong connections to the communities they serve. CIPMA member companies distribute and sell petroleum and renewable fuels to the wholesale, commercial, farm, and industrial and retail markets. CIPMA members employ directly and indirectly over 20,000 Canadians in communities across Canada.
Canadian Independent Petroleum Marketers AssociationTricia AndersonPresident and CEO905-823-6996Cell: 416-795-9593www.cipma.org
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