I have noticed more and more people becoming aware of the utter ridiculousness of capitalism and they desire to support small businesses instead of big businesses. As an independent artist and street vendor, more folx have been asking me what the best payment method is, or which payment method allows me to keep more of my money. I usually say cash is best but otherwise it’s about the same. I decided to research some different transaction fees including the platforms I use, Shopify and Venmo, and others like Square and PayPal. Additionally, I have included information about taxes—AKA transaction fees for the government.
In short, this is the summary of what I prefer for payments in order of percentage taken by the third-party money manager: cash, Venmo, credit card through Shopify. Cash is ideal because the only fees are taxes while online services will take their cut ranging somewhere between 2-3% plus a few pennies.
I use Shopify for my website and e-commerce. They offer a Point of Sale (POS) system that works just fine. Shopify takes out the highest fee of all the services I researched at 2.7%+$0.30. (Note that these numbers are based on POS not online sales). I know the other big one around here is Square which takes a smaller amount per transaction at 2.6%+$0.10.
OK. Turns out credit cards are the least small-biz friendly. But who the heck carries cash around these days? (actually about a third of my customers use cash but you get the point!) What’s a better alternative? Venmo!
I’ve noticed more people using Venmo recently. Money through Venmo is transferable/usable immediately after making the transaction while Shopify offers regularly scheduled payouts, similar to getting a paycheck from an employer. Venmo takes the smallest amount of money per [business] transaction though it's owned by PayPal which takes a higher percentage for some fucking reason.
Venmo is also nice because it has the option to add a tip screen. In my experience, people aren’t big into tipping artists. But if somebody has the funds and the desire then they have that option to say Thank You! Shopify also offers tipping but that would require handing my phone to the customer for them to finish the transaction which I don’t like doing just for the possibility of a tip.
Sidebar: Why tip an artist or street vendor?
In my line of work, I make most of my money at in-person events selling directly to community members. This part of my job is customer service but I do not get paid an hourly wage. I almost always have to pay to be at events. The prices of my artwork are mostly based on an hourly rate of physically making the product plus material and packaging. To break it down, I could work a 40 hour week but only get paid whatever income of whatever I am able to sell if I happen to have an event that week. Sales and income fluctuate every single week depending on time of year, other events happening, weather, and of course the economy. Tipping an artist is letting them know that you value what they do beyond the tangible products they make for you to take home.
Another really great reason to tip an artist is when you take a photo of their work—please ask consent before doing this! It happens quite frequently that somebody will see my work, take a quick photo (are they trying to be sneaky?), and walk away. This really bothered me when I first started doing this work because let’s be real, it’s basically stealing. Steal from Target or Walmart or other big box stores, but not small businesses or independent artists. If you ask to take a photo of my artwork, I will always say, “Yes, thank you for asking!”
Back to our regularly scheduled programming… TAXES
In life, you don’t have to do anything except pay taxes and die. Sales taxes go to local governments while income taxes go to the federal government. It’s common for the consumer to pick up the sales tax tab.
Here in Wisconsin, the state sales tax is 5% and the local county tax is 0.5%. Of every sale I make, I owe the government 5.5%. Great! What about the motherfucking federal government?
Income taxes vary in the world of business and corporations but the average small business pays about 19.8% of their gross income. I am not a businessperson but to put it simply, if you work for an employer you pay some income taxes and your employer pays some too. If you own your business, then you are on the hook for both of those fees. This tax season was the first time I have ever owed money after filing. It was a hefty amount, too. Did you know if you owe more than $1K in taxes come April they may charge you a fee for not paying your taxes during the previous year? Also, isn’t it funny how it takes weeks to months to get your tax return but if you owe them the money they take it instantly? Anyway, being unhappy with taxes is one of the most US American things ever so I’ll stop my rant here.
Thank you to every single one of you who decides to spend your hard-earned wages on small businesses instead of lining the pockets of greedy CEOs and billionaires. The key to capitalism is finding a balance. Many people cannot afford to always pay for what might be considered more ‘ethical.’ Brand loyalty is a corporate scam! Pick your battles and spread your money around. Just remember that when you support your local small businesses, a lot of that money stays in the local economy.
Amazon is so convenient and so cheap (why is it so cheap? exploited labor? poorly made products? minimal safety protocols? hmm...) It absolutely does not make you a bad person if you continue buying from Amazon. Just consider other options beforehand such as local small businesses, thrift stores, and community resources or mutual aid. If Amazon is still the best option for you in that moment, it’s ok. There is no ethical consumption under capitalism.
Please feel free to share any of these graphics. Have a nice day!
xox,
J.K.
