American Express for Your Business?

The question often gets asked and followed by the comment: “Do I need to take American Express, because it’s so pricey?” And “Can anything be done with their rates?”

Well…, it depends.  Answer to second question first: We know someone at American Express that is wonderful and can help business owners who want to carry Amex.  She can give a better deal than any of our providers, so we always send bus owners directly to her.

However, one doesn’t really negotiate with Amex. It’s an undiluted and very strong brand.  Think Mercedes VS my Toyota.

To answer the first question (with the annoying habit of asking another): Is more than 10% of your client base- business professionals for your particular product/service offering?

Is your business in the business district of your city?

See a lot of leased, ‘pre-owned’ BMW’s parked around? Just kidding.

If the answer is ‘Yes’, then it’s the cost of doing business.

American Express is prestigious, and their card holders feel and know that.  Status- buying things that we don’t need to impress people we don’t care about.Amex card holders can spend more with less restriction, and get more perks.  Amex card holders earn higher incomes than the average Canadian (84% earn $34k/yr according to our Government), should be better with their money, and it is more difficult to qualify for their cards.

On the flipside, a customer who carries an Amex card probably has a Visa and a Master Card, so are you losing out on sales?  Maybe.  You have to decide who you are attracting, going after and why.  What do you sell?  If it’s $400 spa treatments, then get the Amex acceptance and pay the extra fees.  If it’s $35 haircuts with no shampoo and rinse, then you can do with ‘just’ Visa and MasterCard.

SIDENOTE: Visa usage can range from 2-3X’s more than Master Card usage.  Why?  More branded Visa cards?  Easier acceptance?

At the end of the day, you are the adventurous few (17% of Canadians are self-employed) who will most probably earn more than the average Canadian. Congratulations for being in business!

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