To Accept Charge or To Not Accept Charge –
A Look Inside “The Bakers Program” 

(From the August 2005 issue of "Beyond Baking")

Credit cards – Who doesn’t have one these days?

When used wisely, they can make shopping online or over the phone a breeze or can help in a pinch when you don’t have quite enough cash on hand to pick up that unexpected purchase.

Or, maybe someone comes to your bakery to pick up a graduation cake and decides to stock up on bread and dinner rolls.  Since they don’t have the cash on hand to pick up the extra purchases, they decide to charge it. 

The question is:  Does your bakery accept credit cards? 

Maybe you already accept credit cards at your bakery and would like to know more about other programs, or maybe you don’t and would like to know what it takes.  Then look no further than Associated Merchant Services, which is part of First Data. 

According to John Gay, account executive with First Data, the company is the largest credit card processing company in the United States.  Some of the businesses they process for are Wal-Mart, Barnes & Noble, Eddie Bauer, JCPenney and Nike.

Working with the Wisconsin Bakers Association, the company established a credit card program (which Gay refers to as “the bakers program”) for WBA members four years ago.

When members sign up to accept cards at their business, they receive a flat rate of 2.2 percent.  Gay said some companies would have a rate, plus a transaction fee.

Along with new businesses signing up for the program, other bakeries saw the benefits of First Data’s program and switched over to it.

“The biggest complaint I heard from bakeries when I first started calling on them was that when someone comes in and buys a coffee and a doughnut and puts it on a charge card, they might as well give them a coffee and a doughnut, because it costs too much on the transaction,” Gay said.

One bakery Gay talked with had a previous credit card program that had a 1.75 percent rate, plus 20 cents per transaction.  Gay said the amount of money a bakery can save by using the First Data program depends on two factors – the bakery’s volume and its current processing program.

In addition to the no transaction fees, the company also provides the following benefits:

Gay said that he has worked with bakeries that didn’t have a credit card program and now they do.  The credit card terminals the company sells and leases also come with pin pads, so merchants also can accept debit cards.

“You have no idea how much business you lose when you don’t take credit cards,” Gay said.  “People tend to spend more when they can charge it.”  Gay added while it’s a different type of business than a bakery, McDonald’s average tickets went up 30 percent when the fast food giant began accepting credit cards.

In addition to the benefits already mentioned for signing up for “the bakers program,” Gay said all of the terminal leases include the gift card program if the business prefers to take part.  He said other gift card programs typically have start up and other fees involved.

Gift cards are a great purchase for those hard to shop for people, and can be redeemed at the business who signs up for the program.  The gift cards can be custom made and can include the company logo, address, phone number and web site.

The cards have no value until they are swiped.  Gay said that other businesses who sell gift cards display them at the counter.

“The great thing about (gift cards) is they are more of an impulse purchase, since it’s displayed up at the counter,” he said.  He mentioned one bakery that got the gift cards in November and sold 400 of them in two weeks!

Gay said the bakeries that have gotten on board with “the bakers program” are pleased with the results thus far.

“The feedback has been good,” Gay said. “At different shows, I run into bakeries I have set up and people are happy with the program.” 

If you’re interested in finding out more about “the bakers program,” contact Gay at (800) 767-2484, ext. 54587, or john.gay@firstdata.com.  He said he can do a free analysis to compare the program First Data has to the program a bakery has now and see if it would save them money.

“If we’re not going to do them that much good, I will be the first to tell them,” Gay said.