Andyandy's Office Supplies
 

1. Open office supply store out of trunk.
2. Sells staplers only. $1,000 each.
3. No questions asked cash-back returns (minus a restocking fee equal to the interchange fee + $5).
4. Profit!

Maybe I'll call it "Staplers".

Andyandy

you can probably get away with a restocking fee of 9.90 + interchange fees :D

coding purchases as office supplies
 

Cash back returns?

Nice try, but I think giving cash back for charge returns violates the merchant agreement. I know Nordstrom has done it, but I don't think it's allowed as a rule.

But I wonder what would prevent an online-only office supply store.

Let's be fair though, forgetting about Chase, OD was losing money. They're clearly paying more than $4.95 interchange fee on $500 GC's.

If you opened an office supply store, presumably you'd offer a cash discount (to avoid issues where that is allowed but a credit-card surcharge isn't) but could you price a $500GC at $510+$4.95? You can mark up a flash drive a couple percent, but how about a GC?

A cash discount and a credit card surcharge are the same thing. I don't think this little work around is a valid option to either contractual agreements or laws preventing credit card surcharges.

I'm not positive, but perversely, I think you're wrong. It's a distinction without a difference, but I think cash discounts are allowed. As Mr. Bumble said, "The law, sir, is a ...."

This may have changed with the recent legislation that now allows credit card purchases to be charged a surcharge.

I've thought about this before myself. Here's what you'd have to do to remain in compliance with the CC company terms and conditions.

1) Open ABC Office Supply Co. (online only)
2) Sell only "reams of paper" (or some such nonsense) for, say, $100 per ream.
3) Open XYZ Co., which then re-purchases the "ream of paper" from the customer for, say, $95. (You can't simply return the "ream of paper" to ABC for cash, since that would violate the merchant agreement).

The $5 difference will more than offset the CC transaction fees to the merchant, making this quite profitable. Still, I imagine Chase would catch on quickly and shut it down, even if it is not technically fraud.

Also, this would require tremendous trust by the customers, because there's nothing to prevent ABC Co. from walking away with all that cash while XYZ folds up shop and never completes the back end of the transaction.

You cannot get cash back from a "purchase" transaction. The Visa/Mastercard settlement does not go nearly that far.

So whats the name of your online store?

I believe that only affects certain states.

Glad to see I'm not the only one with wicked ideas!!

Just FYI, Square swipe is coded as OTHER - MISCELLANEOUS and shows up as my business name on the American Express statement (when expanded, it shows "doing business as...... SQUARE". As I mentioned earlier, nowhere in Square setup did it ask me to choose a category to code my swipes as.

It only takes one Business Class or First Class fight to become an addict with those wicked ideas. :D Of course I wouldn't know.

This is my kind of thread! I too have sat around wondering how I can take advantage of 5x by starting a business of some kind. So far I'm coming up blank, but I'm sure there's a solution out there...one that will make lots of people rich.