Consumers and retailers have different points of view about how payments are made, and different preferences.

According to Ernst & Young's "Survey of Retail Payment Systems," published by the retailing trade magazine Chain Store Age and sponsored by Visa U.S.A., retailers overestimate the role that credit card acceptance plays in attracting customers.

While five out of six retailers said that their card acceptance tends to boost sales, an equal proportion of consumers said they shop in stores that do not accept the card they would most prefer to use.

The survey, released last month at the National Retail Federation convention in New York, also showed that retailers have too high an opinion of their ability to influence consumer behavior through in-store signs and employee suggestions.

"Retailers have to understand the buying habits of their customers better if they are to survive in this cutthroat industry," said Bob Untracht, Ernst & Young's national director of consumer products industry services in New York.

While 1,000 consumers were questioned, only 79 retailers contributed to the findings - a sample assailed by several in the industry as too small to show anything conclusively.

"I'm not real comfortable with 79 retailers, and I'm even less comfortable with them not being named," said a spokeswoman for a national retailer.

Responding to such criticism, an Ernst & Young spokeswoman said: "We felt that the number of retailers was valid enough to publicize the survey. We would never have released the survey if we felt the numbers were not valid enough."

The spokeswoman added that retailers had participated under a confidentiality agreement, which she called a common practice.

Ernst & Young did, however, categorize its respondents: 27% supermarkets/drug stores; 23%, specialty/nonapparel; 19%, specialty/apparel; 13%, convenience; 12%, department; and 6%, discount.

Of all the retailers, 49% said they had sales volume of $201 million to $999 million in 1994. Thirty-four percent reported volume exceeding $1 billion; 13% were between $51 million and $200 million; and 4% were under $50 million.

These disclosures did not satisfy John Ronzetti, vice president of information resources for the National Retail Federation in Washington.

"It just leaves a lot of holes," he said. Retailing is "such a complex market with so many components that to draw such broad- based conclusions (from a small sample) is really a stretch."

Mr. Ronzetti especially took issue with the finding that retailers misjudge consumer credit card attitudes.

The study found 83% of retailers saying credit card acceptance increased sales, while 85% of consumers said they would still shop at a store that did not accept their favorite credit card.

It is unclear whether the consumers surveyed were characterizing their payment habits in a department store or a supermarket - two contrasting environments that were lumped together in the survey.

"Was that Kroger and Safeway, or was that Mom and Dad's grocery on the corner?" asked Mr. Ronzetti.

"The survey indicates a clear dichotomy between retailers and consumers," he continued. "Well, all retailers are consumers. They don't shut out their consumer lifestyle when they're in retailing.

"In my mind, the issue of credit card usage has a unique set of criteria depending on the merchandise and the store. Your credit decisions are going to be different on big-ticket items."

The survey found that 54% of consumers said they had a store credit card.

"Consumers will get (a store card) because it's readily available," said Michelle Meier, government affairs counsel of Consumers Union, a Washington-based advocacy group. "People have many cards in their wallet. The key distinction is between having it and using it."

In other findings, consumers indicated their payment choices were primarily influenced by discounts and coupons. While 47% of retailers said interest rates did not influence a customer's decision to pay with bank or affinity cards, nearly 25% of consumers cited interest rates as the top influence.

In addition, while 48% of retailers said point-of-purchase signs are a determining factor in using a bank or affinity card, only 20% of consumers said they were moved by signs or stickers. While 54% of retailers cited the importance of employee suggestions, just 5% of consumers admitted to being influenced by a store worker to use a particular card.

Cash remains the favored payment method of consumers and retailers. In fact, nearly 60% of retailers said they preferred cash sales.

Based on 1994 sales volume, 88% of those contacted said cash accounted for up to three-quarters of their sales. However, in comparing average dollar amounts per transaction, card purchases were distinctly bigger than those made by cash or check.

The average ticket on a cash sale in 1994 was $21.96, and the average per check was $38.30. But card transactions averaged $46.37 for third-party cards like MasterCard and Visa, $53.17 for store-issued proprietary cards, $48.44 for private-label cards, and $38 for affinity cards.

Debit card transactions averaged $33.97.

An exception to the cash preference occurs when consumers shop at major regional department stores, national department stores, or at retailers specializing in electronics and appliances, the survey found. There, they prefer bank cards or store cards.

When asked about future payment options, consumers indicated that cash would remain their favorite.

"That doesn't surprise me in the least," said Stephen Brobeck, executive director of the Consumer Federation of America. "Consumers are well aware of the cost of paying by credit cards."

"Consumers need to reduce their credit card expenses except when they are able to pay off balances in full every month," he said. "Those consumers who are not able to pay off balances should consider shifting to debit or moving back to paying by check."

Seven in 10 families with credit cards revolve balances each month, Chain Store Age noted. And in the last 10 years, credit card usage has tripled; card debt is approaching $400 billion.

Consumers prefer by far to pay with bank cards and store credit cards, the survey found. Of those who used just one national credit card, 21% used Visa, followed by 19% who used Discover, and 9% who used MasterCard.

Nearly all the retailers - 98% - said they accept MasterCard and Visa; 80% said they accept Discover; and 53% accept American Express.

About 44% of retailers said they accept debit, but only 20% of consumers said they carry debit cards. A majority of the debit holders said they use the cards for 10% or less of their purchases.

Ernst & Young and Chain Store Age have done a retail survey for six years. This year's edition incorporated all payment methods and includes a survey of consumers for the first time. The consumer survey was done by telephone Sept. 20-25.

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