The chief executive of PayPoint has sought to justify the cut in commission caps in light of a 9% increase in the company’s annual profits for the year ending 31 March.
The group today posted operating profits of £49.5m and net revenue of £123m, up 8.3% on the previous year.
Chief executive Dominic Taylor told C-Store that he understood perceptions that the recent commission cuts might be deemed unfair in the context of the positive annual results.
However, he said PayPoint was investing “substantially more” in technology than last year, with much of the investment going into the retailer side of the business, such as third generation terminals encompassing beacon technology.
He also suggested that retailers who were not benefiting from additional footfall should consider their options. “If a retailer isn’t seeing the footfall then maybe the proposition isn’t right for them,” he said. “If PayPoint is genuinely losing them money then we’ll talk to them and discuss the issues, and they can be free to go.”
However, Taylor insisted there would be no U-Turn on the cut in commission caps. “There has always been pressure on us from utilities and we have absorbed the costs ourselves. But we need to reshape the pricing structure.”
But Mo Razzaq, of Mo’s Premier, Blantyre, said: “We can see why the profits of PayPoint are rising: the retailers are facing the brunt of most of the costs, and any errors made are costing the retailer and PayPoint are doing very little to help the retailers.
“Next year I can guarantee that their profits will rise again, they will give out the same message that business is hard, they are there for the retailer and that the extra footfall will cover all losses.
“We need government involvement on below minimum wages rates of commission, they have given PayPoint TV licensing amongst other things and are culpable if they do not investigate this.”
PayPoint’s results also revealed a 38.7% increase in CollectPlus transactions to 18.8 million.