Arby's Plans to Expand Program for Taking Payment by Credit Card
Sep. 13, 1990
NEW YORK (AP) _ Customers of company-owned Arby's restaurants will soon be able to pay for their sandwiches, shakes and fries with a credit card under a program the fast-food operator is launching with MasterCard International.
Atlanta-based Arby's and other fast-food chains have been testing credit- card payment plans in specific markets for several years.
But Arby's said Wednesday its move to take its program to all its company- owned stores would make it the first major fast-food chain to accept credit cards on a national scale.
The company said it plans to start taking credit cards in early October at its company-owned stores in Portland, Ore., and later this year at company- owned stores in Toledo, Ohio; Salt Lake City, Utah; Memphis, Tenn., and West Palm Beach, Fla.
In 1991, the program will be expanded to the other 17 cities where the company owns restaurants. There are 2,350 Arby's restaurants nationwide, but only 244 are owned by the company itself. The others are franchised and it is up to their owners whether to take credit cards.
MasterCard and Arby's said they would spend $1 million over the next year to promote the program through advertising and signs in the stores.
Rege Braun, director of research and development operations for Arby's Inc., said the company expects that by taking credit cards, sales will improve.
In tests in about 100 Arby's restaurants in Cleveland, Pittsburgh, Phoenix and Youngstown, Ohio, the company found the average purchase with a credit card was $6 to $7 compared with an average of $3.80 for someone paying with cash.
''In many cases when you are using plastic, the natural tendency is to be freer with your money,'' Braun said.
In addition, he said the chance to pay with a credit card could attract customers who may otherwise go home because they had too little cash to feed the family or go to a more expensive restaurant that accepts credit cards.
Braun said that while the marketing campaign will mention only MasterCard, Arby's also intends to accept Visa credit cards.
Jody Hancock, a MasterCard executive responsible for new market development, said the company is involved in similar test programs with seven of the top 10 fast-food restaurant chains, but that Arby's is the first to begin expanding nationally to all its company-owned stores.
She said the system will use a payment technology that will allow customers to pay for their food in seconds without having to sign a receipt slip. The store owner will pass the card through a monitor that will screen out stolen or invalid cards in less time that it would take to pay cash and get change, she said.
She said MasterCard has been intent on positioning itself as ''the best card for mainstream America'' and hopes to get movie houses, parking lots and convenience stores to begin accepting the credit cards as well.
MasterCard is accepted at 8.2 million locations around the world, she said.