Increased credit card use hurts gas station profits

LANCASTER, Pa.—Gas station owners say more people pull out credit cards when the cost of a fill-up rises, and that hurts their profits.

The Pennsylvania Gasoline Retailers Association says the retailers make about 2.5 cents per gallon, but on credit sales they pay 7.5 cents per gallon to the credit card company. AAA says fees reduce profits nearly 83 percent on credit card sales.

Higher prices increase the problem. Executive director Ross DiBono of the retailers' association says three-fourths of customers use credit cards when the price is $3.50 a gallon, up from half when the price is $2.50.

Some chains such as Wawa and Shipley Energy, owner of Tom's Convenience Stores, are testing discounts for cash purchases in some markets. Spokesman Scott Sewell says three Tom's stores, including one in Lancaster, are offering 4 cents a gallon off for paying cash.

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Information from: Intelligencer Journal, http://www.lancasteronline.com/pages/paper/sundaynews/