This past weekend I drove an Ineos Grenadier to Moab, Utah and back to LA. It was about 24 hours of driving; add the additional eight or so hours of epic off-roading, and I was burning lots of gas. This meant I was constantly on the prowl looking for the cheapest fuel between California and Utah, and one thing that annoyed me to no end — and that has annoyed me for years — came to mind: The way gas stations advertising pricing is total bullshit. I realize this is a random blog, but just allow me to rant a bit.
Cornell Law School defines a “Bait and Switch like this:
A “bait and switch” takes place when a seller creates an appealing but ingenuine offer to sell a product or service, which the seller does not actually intend to sell. This initial advertised offer is “the bait.” Then the seller switches customers from buying the advertised product or service that the seller initially offered into buying a different product or service that is usually at a higher price or has some other advantageous effect to the advertiser.
Per the university, this kind of thing is not legal. “’Bait and switch’ advertising is grounds for an action of common-law fraud, unjust enrichment, and sometimes breach of contract. A ‘bait and switch’ is also a violation of the Consumer Fraud and Deceptive Business Practices Act,’‘ writes Cornell.
Gas station pricing seems pretty damn close to falling under this definition, though if I had to guess, it probably technically clears the bar because of two small terms on the signs “cash” and “w/car wash.” Both of those terms drive me nuts.
First, we’ll start with the cash price thing, because that’s the one everyone knows, even though I think it’s the lesser of the two evils.
Cash Price
You’ve probably all seen signs like this. They show the price of gas nice and big, and then in a smaller font, they’ll have the word “cash” to indicate that, actually, this price isn’t what you’re going to be paying because you, like the vast majority of shoppers, aren’t interested in using cash to buy gasoline. What you will instead be paying is a higher price — probably 10 or so cents higher. What’s the deal with that?
Well, it seems there are two answers to this. The less obvious one (to me) is that people who buy gas with cash have to enter the store, and that represents an opportunity to sell more products. Per the National Association of Convenience Stores’ “Consumer Behavior at the Pump” study from March, 2019:
“As in previous years, the top reason that gas customers go inside the store is to pay for gas at the register. While 78% of all customers pay by credit or debit card, a sizable percentage of customers pay by cash inside the store. Fully half (50%) of all female customers pay for gas at the register”
[…]
Ultimately, success for retailers is often determined by how they can attract customers to their lot to buy fuel and also get them inside the store to purchase other items. Or, increasingly, by developing a strong in-store offer that translates to a fuel purchase that may be less dependent upon only the gas price sign.
So if a gas station can offer a discount for cash users, one might feel inclined to head into the store to hand over a few greenbacks. This is the number one reason why folks head into gas stations, with snack buying and then bathroom usage coming in after that.
To buy drinks (42%) and snacks (37%) are the next two reasons that gas customers come inside the store after filling up at the pump. Retailers also could consider the importance of two services that attract customers: More than one in five customers say they used the bathroom (21%) and one in eight used the ATM (13%) the last time they went inside the store. The importance of amenities like bathrooms and ATMs becomes much more apparent when looking at the order of purchases: Most drivers go inside the store before they buy gas (59%). Certainly, this includes the 45% of gas customers who pay inside, but many customers go inside the store before buying fuel, most likely to withdraw money for a cash purchase or use the bathroom.
Here’s a look at what people buy most frequently in gas station convenience stories, in case you were curious:
Of course, there’s a more obvious reason why the cash price is cheaper than the credit price: Gas stations have to pay merchant “interchange” fees, as Chase bank points out in an article on the topic, writing:
Gas stations are in fact legally allowed to charge a customer extra if they choose to use a credit card to purchase gas. This is because the gas station owners pay an interchange fee to the payment networks. They often pass this fee on to the consumer to recoup that additional cost.
An interchange fee is part of every credit card transaction that a merchant processes. The merchants themselves do not keep this money though. It’s passed back to the card issuer to cover the cost of processing the transaction as well as the risks associated with lending the credit.
So you might wonder how much these fees are, and whether or not the price you pay at the pump with your credit card is more than these fees. Is the gas station making more profit if you use a credit card? Per Chase, the answer appears to be: Not really:
Gas stations charge an average of 5 to 10 cents more per gallon for credit card purchases.
According to the Association for Convenience and Petroleum Retailing (NACS), Opens overlay, credit card processing fees at gas stations average about 2.5% of the total transaction price. As of October 2022, the national average for a gallon of gas, Opens overlay was $3.76, which would make the processing fee about $0.09 per gallon.
In general gas stations typically have a low profit margin on gasoline sales. Intense competition from other nearby stations means they’re often pricing a gallon of gas just a couple pennies over cost.
Still, why do they charge the customer the interchange fee in the first place? If you go into a Target, there’s no “cash price” on the goods, and Target has to pay the interchange fee too, right? I don’t have the answer to this, though I suspect it comes down to “low profit margin on gasoline sales” and of course the fact that, if the cash price is lower, you’re more inclined to enter the store and buy something.
W/Car Wash
This next one drives me mad, because, while I’m used to paying about 10 cents more than the (cash) advertised price on most signs, I don’t expect to have to buy a damn car wash in order to get the price shown.
Seriously, look at that Shell station above in Barstow. The biggest price at the top of the sign is $4.19 9/10 a gallon. If you’re driving along looking for the cheapest price, you’ll see that big number and head straight to the Shell, only to realize that this price only applies if you buy a car wash. This is wack.
First off, it’s worth noting that, despite phone apps that help you find the best price, NACS says the majority of people use store signs to shop for pricing, so having unclear signs is going to bring in potential customers, whom you will then disappoint.
I was one of those potential customers. I arrived at that gas station, finally got close enough to the sign to see the strategically small-fonted “Regular cash w/Wash” text above the advertised price, and then blurted an expletive or two at whoever runs that fuel station. To me, that seems like a Bait and Switch. The price per gallon looks to be $4.19 9/10, but upon arrival, you realize you’ve gotta buy the damn TrueCoat and pay with cash to get that price.
According to NACS, these tactics aren’t exactly ineffective. As you can see in the plot above, in 2019 16 percent of folks paid cash for a discount and 18 percent took advantage of bundles to get a discount.
So that’s why it happens, but it doesn’t make any of it acceptable in my mind. I guess I can understand the cash/credit thing due to the interchange fee, but with the vast majority of folks using credit cards for gas (and it looks like that 77 percent has risen from 2019, possibly due to COVID restricting cash use), having the big advertised price on the sign (which is still the primary way folks shop for gas — looking at signs) be the cash price just seems dishonest. And having that big price require a purchase of something else like a car wash? Get that crap out of here!
Images: NACS
This is why I try to use warehouse clubs (Costco and BJ’s) to fill up as much as possible. Cheapest in the area, fresh fuel since they’re selling a lot and same price. Like others have said, the Costco credit card is a good one for gas since it’s 4% back. The upside is it knocks the net price down to under the cash price. The downside is that it’s only redeemable in February every year and a Costco membership is necessary to keep the card. Now that’s sneaky!
The Sam’s Club card (the good one) gives you 5% back on gas, anywhere you buy it, except at Costco. The amount accumulated in a month or less, and you can use it in the store as a discount off of your purchase.
Is a different cash price really that common? Around here in Idaho, only the big truck stops have separate pricing for cash vs credit, and even then sometimes only for diesel.
I was also surprised to see the graph indicating that brand reputation is the LEAST common way people choose a gas station. It’s the only way I choose gas stations.
Because there’s no point in looking at prices when Costco has the cheapest gas every single time without fail, and Maverik is the second cheapest without fail. Although with the Maverik rewards card sometimes it’s as cheap as Costco. It has been a very long time since I’ve actually bought a whole tank of fuel at any station other than a Costco or Maverik.
Speaking of which, why do so many people willingly pay extra for Shell, Chevron, ect. when there’s a convenient Maverik for 3 cents less?
My partner used to specifically go to Chevron. I think she was convinced it was better gas. She would also use their crappy car wash until it knocked her mirror apart (just the back cover and it popped back on, but still). Last time I was with her when she gassed up, it was Fred Meyer, so I think she’s moved on.
So Chevron legitimately does add a Techron additive to their fuel that other gas stations don’t. It is all the same gas from the same refinery, but Chevron adds stuff to it. I’m not convinced that their injector cleaner is any less useless than other injector cleaners though.
And that doesn’t explain why people pay extra for Sinclair, Shell, ect.
I’m actually realizing just now that Sinclair, Shell, Chevron, Maverik, and the two Costcos are pretty much the only brands of gas station here in the Treasure Valley. So many other chains that just aren’t around here.
Does anyone know what “Techron” actually is? It could be just the sludge that accumulates at the bottom of the huge tanks at the refinery. Or possibly some carcinogenic, acidic slurry of polysyllabic compounds that costs a ton to break down into something safe so it gets added in as a “feature”. Or it could be something wonderful that actually makes your car run better and more efficiently.
I think it’s a safe bet that Techron is similar to other injector cleaner products, considering it is advertised as having the same benefits. Those injector cleaners are usually Jet A(basically kerosene) and methanol, and are questionably useful at best.
Google “What is Techron” and you’ll know the basics.
It contains a polyether amine-based detergent, which is purported to dissolve deposits in automotive engines and prevent them from building up..
Mineral spirits, naphtha and other distillates are the carrier liquids.
I would pay 3 cents more for “Top Tier” fuel occasionally while traveling. If not for the benefits they claim, but to know that the seller is legit and the fuel is formulated properly.
Maverik is not listed as a Top Tier gasoline brand like Costco, Chevron and Shell. So yeah, I’d go to Shell or Chevron and pay a bit more if there wasn’t a Costco nearby. Fortunately many of the brands near me, whether expensive or cheap, are certified as Top Tier.
The credit vs cash price and car wash discount is definitely annoying but then there are also the places that add on a flat fee for using credit or debit. Between not doing that, the overall lower prices, and the layout that has everyone going one way vs the chaos of most other stations I’ll only go to Costco unless I’m absolutely forced to go elsewhere.
Funny how it’s only been the last few years where the cash/credit prices have been different even though they’ve all accepted credit cards which charge the transaction fees for decades. Almost as if they figured out people don’t carry enough cash for a full tank at today’s prices and that if they all do it nobody has a choice…
I have used Exxon, Shell and Wawa credit cards (all managed by Citi Bank) which all offer a discount at the pump for using their card, with most giving you the cash price as well. I have the normal low limits for the gas cards, but that is all that I use them for and pay them off every month (otherwise the 30% interest eats the savings in no time).
The best one for gasoline is Costco with their credit card, which gives you 4% back on gas purchases (in a statement credit that you have to go into Costco to cash). Costco gas is Top Tier gas as well.
7-11 will give you 7 cents off their prices with the signup for 7-11 Rewards with some occasional bumps of up to 11 cents on top of the 7 cents for 18 cents off.
Safeway and Giant will give you discounts for buying groceries on gas (Safeway is better than Giant with the rewards)
Royal Farms will give you discounts for giving them them your debit card, which I do not like.
When I worked at two gas stations, we used to price the gas at 2.999 or 3.019, since people lost it when the price was even amounts and the cost at the pump was higher than what they thought it should be. What always amused me was how people would buy $3.00 of gasoline, no matter what the cost of gas was (around $1.20 to $1.50 per gallon at the time).
I guess that I buy too much gasoline is the real answer.
That is why I almost exclusively buy gas at Costco at home and on trips. They don’t take cash so their price is always credit and it is usually the cheapest in a given area. Even if another station nearby meets Costco’s price, that is the cash price, not credit price. Plus using the Costco Visa card means I’m getting 4% cash back on gas.
I did use Sam’s Club too but they closed all their stores in my state several years ago so I let my membership lapse.
There’s a gas station near me that charges an extra 80 cents per gallon to use the debit card. The one across the street just charges a flat 50 cent fee for the entire purchase. Guess which one is always busy…
I’ve just conditioned myself to add an extra 10 cents on whatever prices I see listed on the sign with how sneaky gas stations try to be.
Holy shit, David with a pop culture reference (from a 30-yr old movie, but hey)
You betcha.
I think it’s sort of wild that societally, we just accept that cash is free. I guess because it’s easy to put a price on the card?
Cash has to be counted, matched to the computer, and transported to a bank. Any business dealing with cash doesn’t just have that money go from my hand to a bank account without someone being paid to deal with it. Any business dealing with a lot of cash will have an armored car show up, but the cash buyer doesn’t pay a fee for that.
You’ve never heard of Gasbuddy? That’s the best way to find the cheapest gas.
GasBuddy is the tool to have, especially if you drive something that doesn’t burn regular unleaded. Sometimes diesel pricing isn’t even on the sign, but it’s on GB.
I think the cash vs credit thing might be due to credit card companies getting more greedy with their fees. But I could be wrong about that.
Of course stuff like this alone with fuel prices fluctuating in sometimes-unexplained ways is just more of an incentive for people to switch to BEVs.
But this isn’t the worst scam I’ve heard related to gas stations.
I’ve heard that some gas stations in some places in the USA where if you pay at the pump and set the pre-approval amount to a certain number, it will charge you that full amount, NOT the actual dollar amount of gas you filled up to.
So if you pre-approve for $60 but only fill to $50 worth of fuel (because your tank is full), you still get billed for $60.
And that is complete bullshit.
I don’t think I’ve ever seen a place that actually keeps the amount above what you fill. I have seen a lot of people complaining that the hold for that amount stays on their credit card/bank account for a few days before correcting to the total spent, but it does end up reflecting the actual total. Generally, paying at the pump doesn’t have you select the amount, either. They just place a hold for $100 or whatever until the total is verified, at which point they change it (but the bank/software/whatever is a lot quicker charging you money than correcting).
I’m not saying it doesn’t happen, but I think it’s vanishingly rare that a place actually just keeps whatever the pre-approval amount is.
Every gas pump in Illinois warns about placing holds on your account, but it has never happened to me ever in my entire driving career.
Yet, it happened to my wife just last month. I wonder (and this might be worth looking into) what determines whether you get a hold or you don’t?
Yeah, I can’t say it’s ever happened to me, either, but it’s been some time since my account margins have been thin enough for me to really notice. I suspect there is some combination of the financial institution, your relationship (and balance) with said institution, and the gas station’s relationship with them. The frustrating thing is that it’s likely to mostly hit the people who can least afford the hold.
And, yes, I think an in-depth exploration of how the holds are determined would be nice. It seems every couple months there’s another article popping up from somewhere into my Google News feed warning people, but they all just settle on debit vs credit, which does not seem like the whole story.
Preface: when I buy gas I always fill my tank. I can’t see any reason not to.
In the olden times, you could pull up to the pump, fill your tank, head inside and wait in line to pay for your gas.
Nowadays, you pull up to the pump, head inside, wait in line, and give the cashier more money than it will take to fill your tank. Then you go outside, fill your tank, and then head inside AGAIN, wait in line AGAIN, and collect the change left over from your fill up.
It can turn filling your tank for cash into a 20+ minute ordeal. No thanks, I’ll pay the extra dime.
Or just buy a BEV and charge overnight at home and give a big middle finger to gas stations and the oil industry!
Impossible in my living situation, but thanks for the idea.
Well it might be impossible for you for now, but keep it in mind in case that changes. And it likely will change eventually as many condo and apartments add BEV charging to their parking lots.
Also of note, there is some semblance of competition in the retail gasoline business, whereas most folks have only one choice for sourcing their electricity.
My dad absolutely refused to patronize anyplace that does cash pre-pay. Well, to the best of his ability; he generally has a tough time of it. Stewart’s Shops, near me, lets you pay with cash inside after pumping, and also doesn’t do gas price shenanigans, so I typically point him towards it when he visits. Even though their price might be a few cents higher I typically just go to them without comparing when I need gas (which is rare, PHEV driver).
There have been a couple of times in my rural travels when I got gas a old general store type places with one pump from sometime in the middle of the past century. I’d go in to pay first and they’d laugh. “Just tell us how much after you’ve pumped.” It felt so wrong.
Stewart’s!
I also live in the land of Stewart’s, and they are favored for not doing the credit surcharge, and also, the ice cream. I like their coffee, but the food is unfortunately awful.
With you on the ice cream, and also (related) where we grab our milk. As for food, I am hooked on a meat lover’s eggwich in the morning and sometimes grab a cheeseburger for a quick grease top-up.
Oh man, the meat lovers. I used to grab that and a Red Bull in my 20’s. I can’t do that anymore, lol.
Everything old is new again. I remember in my youth when all gas stations had separate prices for cash vs credit. This was back when the majority of purchases were made with cash.
Then, around the late ’80s I think, one gas station chain began charging the same price for cash and credit. I think it was around the same time pay-at-the-pump became a thing. I believe the thinking was that the stations could reduce staffing if more customers paid for that gas at the pump.
This chain then heavily advertised the fact that they were not charging “extra” for credit. Their competitors were soon forced to follow suit. Then nobody gave it another thought until now.
You drove a Grenadier from LA to Moab and back again, and all you have to report is gas stations? We know the Grenadier is thirsty on a cross country drive, but what else?
Seriously, we need to hear more about that Grenadier in Moab. I actually saw my first Ineos Grenadier in the wild this weekend near Naples, FL. I was pretty excited as I had previously assumed the Grenadier would never make it to American roads like so many prospective automotive launches in the US that don’t come to fruition (anybody remember the Cross Lander?).
It was sensational. A triumph.
An A+ machine that I recommend anyone who has the means and who LOVES off-road driving go out and purchase right now.
My brother in CO bought one. We have a shakedown trip in West Virginia this fall before he does Moab with it.
He says the steering wanders a little on the highway. Did you notice any of that?
Every station here gives you the cash price if you use a debit card. I don’t even have a credit card so this is a non issue.
I’ve wondered about that. I use my debit card too (don’t even have a credit card) and hate going inside to pay and needing to wait in line behind tobacco and lotto buyers and folks who just don’t have their shit together.
The main issue with using a debit card is the funds hold they put on your account. This can be up to $100. While it might not e a problem, I think it’s far less of an issue on a credit card than a debit card.
Another issue as of late is card skimmers popping up at gas stations all the country. There’s a Pilot truck stop about an hour from where I live and they found 3 skimmers on the pumps!
It’s coming down to where “Cash is King”-again!
I’ve never had them put a hold like this on my account except when I was in Europe. Maybe it’s the bank I use…
Could be your bank, or maybe I’m not up to date. It’s been a long time since I used my debit card for anything other than cash at an ATM. I remember it being an issue for me once when I was much younger and living with no buffer.
I’m fine with $100 hold. If you can’t get gas because of $100 hold, you probably shouldn’t even be driving honestly.
Please explain to me how a person who doesn’t live where there is good public transport is supposed to get to work, grocery store, etc. without driving? Not having a job that provides a good income is quite common. Many people live paycheck to paycheck, just as I did 25 years ago. It didn’t affect my ability to pilot a cheap car.
The bigger issue with using a debit card is fraud protection… credit cards have more of it and act as a buffer between them and your bank account.
And I personally have only had a case of fraud when using by debit card at a gas station that didn’t accept credit cards… where a mysterious amazon fee started popping up on my bank statement… which totally was fraud.
When I lived in Louisiana I learned to just use my credit card for purchases at the drive through. It was fairly common for people to snap a quick picture of you debit card when they’d run it.
My bank has fraud protection on debit cards. I’ve had them deal with a minor amount fraudulent charge and they were great about it.
Yeah, debit cards are getting more protections nowadays. I buy most things on debit, even online, with just occasional credit card purchases to keep my card active, paid off every month to keep my credit score high.
Yeah well with the fraud incident I had, my bank sucked ass. Had to wait on hold for 4 hours and tried to get me to do stupid shit like “check your amazon account” which wouldn’t have done diddly squat.
So I’m gonna continue to NOT use my debit card for purchases except as a last resort.
What really pisses me off is that the most stations charge the same for “Credit or Debit”- They are very far from the same. While Credit charges a percentage of the total after a transaction fee, DEBIT (PIN) based transactions are the same as cash with about a .7-10 cent per TRANSACTION fee. So if you use a debit card, you are now literally handing over all that money to the gas station. I used to love going to Arco stations in CA because they charged you .25 cents to use your debit card and didn’t take credit. SO they maybe made 15 cents on the entire tank of gas you bought verses dollars. There should be a Law about cash and debit being the same thing. Credit I kinda understand…. However I almost never frequent stations where there is a difference in price, Clubs (Costco) and most Grocery chains (Kroger etc) do not charge different prices.
What about this whole bullshit nine-tenths cent pricing per gallon?
$3.999/gal?! Why not just round up?
That’s another one of their dirty tricks. We all ignore the 9/10ths when talking about gas prices.
What about the 99 cent store charging 99.99 cents per item??!!
That’s a federal gas tax, I believe. That’s always there.
Let’s face it, we need major changes on how the price of everything is advertised. Just about every business operates on a let’s get them in the door and then try to soak them through trickery, deception or outright lying.
I’d love a similar article about the bait and switch on lease deals. The past 2 cars I’ve bought/leased I’ve gone to a dealer referencing a national lease deal on the car that I’m interested in. Both times, I got a bunch of yada yada about why they can’t meet that price and whatnot. In at least one of these occasions, the lease price wasn’t just on the national (BMW) website, but also on the dealer site. Come on…
Went to get gas recently and the price on the pump after I swiped my card was different than the advertised price on the reader board and I got pissed, but eventually realized the pump price was actually cheaper.
Was just so conditioned that if the price didn’t match it probably wasn’t in my favor I went straight to anger.
I would guess almost no one around here pays at the register anymore. Apparently there was enough trouble with driveoffs that they require either pay-at-the-pump or pre-payment, which is a PITA. Of course, that means two credit card transactions every time I buy something inside, but I guess it’s worth it to them.
Small place in Maine installed pumps about a decade ago – completely unmanned.
Included a cash option like all the new self checkouts do. Put in your $20 bill and the pump would stop at $20.
I always admired it and felt it was the best of all worlds.
The only ways you could buy gas late at night in many parts of Europe in the 1980s was to insert cash or use a credit card. Many of the stations I stopped at had most of the lights off and looked like they were closed.
The cash price thing really grinds me it’s gotten to be so pervasive, and is such an obvious BS ploy. I don’t know about the rest of ya’ll but I haven’t regularly paid cash to pump gas in probably 15-20 years. Of course on the plus side it’s become so common that I can now assume the real cost is at least $0.10 more than whatever is advertised at top of the billboard.
That being said, having worked as a manager at a local retail business, credit card interchange fees have gotten to be an utter bullshit graft. In a small retail business our monthly merchant fees were anywhere from $600-$1200 per month depending on how how busy we were as well as how much folks used rewards cards, if I understand my old boss correctly many rewards cards charge the merchant some percent extra to pass on their costs for offering the rewards. Hot take, but I think US treasury should offer a competing free or bare bones cheap card processing service as cash has largely become obsolete and merchant services are the replacement, and it’s especially burdensome on small local businesses.
“and it’s especially burdensome on small local businesses.”
Yeah the owner of a local bakery near me explained that the credit card companies wanted to charge him 4% off of every transaction… which was absolutely ridiculous. And that’s why he stopped accepting credit cards.
The gas stations don’t charge a ‘cash’ price on any of the goods sold inside the store, though, do they?
Thus, the ‘cash’ price for gasoline solely exists to make MORE MONEY.
The profit margin be as high as 50% for many of the in-store item categories. For gas they are lucky to make 5% on regular. That said you aren’t wrong as I’ve seen many stations where it is an extra 20 cents/gal for credit. At least around here many of the stations have signs that give both prices.
I mostly stick to the Sams Club about a mile from my house for all my fueling needs. They are generally 30-40 cents cheaper per gallon in my town. On the road, I tend to stick to a couple truck stop brands that have an additional 10 cents a gallon off with a free member number from their app (Loves and Pilot/Flying J). I do try to plan ahead with an app like gasbuddy if I can when towing the camper, since a little savings adds up when getting 12 mpg when towing.
completely off-topic, except that the discussion of credit purchases of gasoline reminded me of something that amused me.
Visited Rome for the first time this spring, and from a bus window saw what i thought was a driver gassing up from a curbside pump on whatever avenue i was on. The next night, walking back to my hotel from the stadium, i passed two different spots (but same brand) on a main drag in an apparently trendy neighborhood north of the Vatican: three consecutive empty “parking spaces” along the curb, fronting a pair of gas pumps with a self serve credit card kiosk between the pumps. How they keep people from poaching those spots, i dunno, because the parking situation in the neighborhood on a Saturday night was dire.
Is this set up common in older cities with valuable real estate? As a lifelong midwesterner, it feels unnatural for there NOT to be at least three gas station marquees in sight at all times while driving. Each with 4-12 pumps, if not a car wash and/or QSR on the premises.
It’s not just gas stations. Several restaurants and small bakeries around here also have different prices for cash and credit (which you’ll find out in small print on the menu or a hand-written post-it on the cash register). And most of them, at least here in Michigan, could be taken to court, because the law here is that you can’t charge more for credit, but you can give a discount for cash. But many of the small restaurant/bakery bills add a “credit surcharge,” so by the letter of the law, they are in violation, even though the effect is EXACTLY the same. If there were some money in it, some shady lawyer would sue them, but I suspect the courts would just tell them to change their wording.
I would assume restaurants are doing it because lots of people order out now and that means they are losing out on that tip money which in turn means they would need to pay employees a more fair wage so yay credit card fees.
It might even be worse than that. If they can say that X% of their sales are cash, they can (over)estimate the cash tips their employees receive in states with separate tipped minimum wage. So they can more easily avoid paying the difference between tipped minimum and standard minimum based on some accounting that might not be fair.
As for the ordering out, I know a lot of restaurants around here have 3+ different prices. Online, delivery app, and in-restaurant (sometimes cash vs card there). Even if they are decent and paying their employees well, navigating the current landscape of food service is difficult.
Yeah I have ones around here that automatically try to put a 15-20% tip. Like yeah no I am driving over and picking up my food and going home if I was sitting down and ordering I would tip my server. Also yeah I have noticed if a restaurant uses certain websites to order their food like grubhub the prices are increased 10-15% while other restaurants that have their own websites or a cheaper domain the prices are the same as the dine in price.