Surcharge a go go

Feb. 17, 2002 | by

A g-string will make a man do some pretty crazy things.

That seems to be the case at gentlemen's clubs, where ATM users pay some of the highest surcharges in the business to get their hands on cash. Although surcharge rates vary in these clubs, they most commonly range from $3 to $10 – well above the $1.50 to $2 charged at most other machines.

"I've never seen one less than $3 in a strip club," said Randy Stoler, managing member of ATM Providers LLC, a San Rafael, Calif.-based ISO.

Stoler charges $5 at the two San Francisco-area lingerie modeling studios where he has machines. He contends that customers expect to pay a premium for any and all services rendered at these clubs.

"You know going into this environment that you're going to get reamed, and everything is going to be overpriced," he said. "That's just the way it is if you want to be there checking out naked girls. When you're about to spend hundreds of dollars on the girls, what's another $5?"

Gentlemen's club patrons are "the ultimate example of a captive audience," said Mike Stevenson of Euclid, Ohio-based WRG Services. "You've got guys with naked girls in front of them. They're thinking, 'Do I pay $10 or do I go down the street (to use the ATM) and miss 10 minutes of this?'"

About 40 of Stevenson's 2,500 ATMs are at gentlemen's clubs. His convenience fees range from $3 to $10, although he's heard of deployers collecting charges as high as $20 at other clubs.

Patrons seem to prefer an ATM to a credit card for cash access, Stoler said. Not only are ATM fees almost always less than the fees required to make a cash advance with a credit card, but ATM receipts often offer relative anonymity – a benefit uniquely well suited to gentlemen's club customers, especially those who share bank accounts with a spouse.

"My receipts don't include the name of the business. They just say 'Mini ATM' with the address," Stoler said. "Credit card slips usually include a lot more information, up to and including the phone number."

The common practice of omitting the business name on gentlemen's club receipts led to an interesting encounter for Stevenson. He got a call from "a really irate customer" who wanted to know what line of business he was in. When Stevenson told him that he sold and processed ATMs, the man said he was on his way over and abruptly hung up. A short time later, two men showed up at Stevenson's door with fire in their eyes and ATM receipts in their hands.

One look at the receipts told Stevenson all he needed to know. "I said, 'Have you ever been to a place called the Executive Den?' The guy got a meek look on his face, said 'yeah' and that was that."

Indeed, Stevenson said he has received relatively few complaints about the charges. He recalled a New Jersey attorney who called to object about a $5 fee, but "when I offered to respond to him in writing and asked for his home address, he didn't want any part of it."

As high as the fees seem at these clubs, some customers -- including the aforementioned attorney -- pay them several times in one visit.

Recalling another customer who made three $20 withdrawals in quick succession – paying an $8 fee each time – Stevenson said, "Everybody has good intentions about not spending too much when they go to a topless club. But the more they drink, the better the girls look – and the good intentions go out the door."

While one might assume that security and vandalism would be problems at these clubs, just the opposite is true, according to Stevenson and Stoler. "It's usually a very controlled environment, with a bouncer on site," Stoler explained.

Stoler services his ATMs and replenishes the cash himself because the private clubs where they are located are low-volume sites. While many people assume the experience is titillating, Stoler said it's surprisingly mundane. The female employees are usually sitting around playing cards and waiting for the next customer and barely bother to acknowledge Stoler's presence.

It does have its occasional exciting moments, however. Stoler once walked into a club and found the employees laughing, with this ATM-related tale to tell: A short time after one of their coworkers took a client into one of the private rooms, the door burst open. The woman, riding crop in hand, herded her customer -- on all fours and with an ATM card in his mouth -- down the hall to the machine.

After making a withdrawal, the man returned the card to his mouth and went back the way he came.


Topics: Retail / Off-Premises

Companies: WRG Services Inc.


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