What would it cost Square to swap out unencrypted readers for encrypted versions?
Payments
Asked by Question Bot03/Jun/20141 answer
1 Answer
F
Faisal Khan
Answered 03/Jun/2014
Considering they will be ordering in the millions, they would be able to negotiate a very good deal.
Generally (for high volume, 5,000-10,000 pieces) orders OEMs in China and Taiwan charge US$ 6.00 to US$ 12.00 per unit (encrypted units). The price dynamics drastically change when you order 100,000+ and where business is tough, everyone would be clamoring to get on your bandwagon. Granted the volumes quoted are not high by any standards when it comes to Square.
I would estimate, the encrypted version would probably cost them sub $5.00
I do not think it would be hurt them, they might be able to get a few basis points lowered on their acquiring fees and insurance related matters. It's a natural progression of sorts to switch to the encrypted version, so I am sure this is something Square had in mind, and have taken into account in their product road-map and business road-map.
Generally (for high volume, 5,000-10,000 pieces) orders OEMs in China and Taiwan charge US$ 6.00 to US$ 12.00 per unit (encrypted units). The price dynamics drastically change when you order 100,000+ and where business is tough, everyone would be clamoring to get on your bandwagon. Granted the volumes quoted are not high by any standards when it comes to Square.
I would estimate, the encrypted version would probably cost them sub $5.00
I do not think it would be hurt them, they might be able to get a few basis points lowered on their acquiring fees and insurance related matters. It's a natural progression of sorts to switch to the encrypted version, so I am sure this is something Square had in mind, and have taken into account in their product road-map and business road-map.