7-Eleven Employs Its Broad Reach to Launch Interchange Signature Drive
7-Eleven is placing the interchange petition at all of its check-out counters across the country to try to generate popular support for an effort the company argued will assist the primarily small business franchise owners.
"Transaction fees squeezed American businesses and their customers to the tune of $48 billion in 2008 alone," the company said when announcing the drive. "On average, an American store owner will actually pay nearly twice as much in transaction fees as they earn in profits, according to the National Association of Convenience Stores 2007 State of the Industry data."
"7-Eleven stores are operated by franchisees who represent more than 6,000 small businesses on Main Streets and in neighborhoods across America," said Darren Rebelez, 7-Eleven Inc. executive vice president/chief operating officer. "This petition drive is a grassroots effort to get a fair deal, spearheaded by small business owners in the communities where they live and with the customers they serve every day."
He added, "Interchange fees are hurting individual small business operators, which represent more than 75% of 7-Eleven stores in the U.S. Because more and more customers are using credit cards for small purchases, there are small transactions where the operator actually loses money. The fundamental challenge is that in most business relationships, both parties have the ability to negotiate, and in this case we do not."
Credit unions have tussled with retailers on the interchange fee issue. Credit unions have joined with other financial institutions to fight any cap or reduction in debit and credit card interchange fees, citing their importance to their balance sheets.
"We're not asking for a bailout, we simply want to negotiate in good faith with credit card companies in the same manner we negotiate with thousands of our other business partners," Rebelez said.
The company asserted that American consumers pay among the highest transaction fees in the industrialized world. An average of $2 out of every $100 Americans spend goes to transaction fees, and for many businesses, transaction fees are now their highest nonlabor cost, growing even faster than health care costs.
The 7-Eleven petition drive will continue through Aug. 10. At the conclusion of the campaign, the top signature-gatherers from each of 7-Eleven's seven U.S. geographical divisions will be flown to Washington to personally deliver the signatures to Congress.
The convenience store chain also offers 7-Eleven branded Visa cards that it issues in an agent program with Chase Bank, which it collects interchange from. However, a representative from 7-Eleven said there was no conflict between issuing a co-branded Visa card and opposing interchange fees since the firm didn't make any money from interchange on the card, passing the savings back to consumers.