Daily Price Movement / General Discussion, page-33239

So there's a couple of things that made me think this and it's linked to the fees that Affirm and Zip charge their customers:
- Basically in the Retail Investor Day, from memory, it was Ezra talking about the fees and saying that because Zip charges the customer also, they can reduce the % transaction fee they charge the merchant, and then he said that is why Zip can offer their product on items like groceries, food, etc - as in low margin volume businesses. The implication being that the standard 4%-6% merchant fees we know about are too high for low margin high volume businesses, which makes sense.

- This really stuck with me because APT, SZL and Klarna proudly don't charge the end customer any fees, so they have % transactions fees around the 3.5% - 6% mark. Affirm and Zip do charge the customer fees, whether it's monthly fees, interest charges etc. Then you look at what has happened - Affirm has integrated with Walmart, Amazon and Target - Afterpay and Klarna haven't, and in fact haven't integrated with any of the big-box retailers. This is strange to me - APT and Klarna have killed it in terms of their expansion, roll-out, partnerships and growth - I struggle to believe that they just haven't been able to land one of these big-box retailers at any point since 2019, which was the time when Affirm started their partnerships. I won't go into detail here, but it also sounds like SZL's tie-up with Target has caused some growing pains for them - not terrible or anything, but we can explore that later.

- My theory is that the major big-box retailers simply can't accept a % transaction fee of say 3.5%+, so APT and Klarna, without making up the difference on the customer, can't easily service these retailers. Zip and Affirm, by drawing revenue from both sides, can.

I think there is a material chance that Zip lands the 2nd BNPL spot at Walmart or Amazon, and I think may land a number of the big-box retailers. This is purely my own thinking, but I can't think of a better explanation than the different business models and fee structures as to why APT and Klarna haven't landed a single one of them in a few years and Affirm managed to get 3. It's too extreme to simply be APT/Klarna's enterprise teams dropped the ball and Affirm are amazing, that's too simple. I think it's to do with business models and I think that places us extremely well. Ezra himself stated the current pilots in place are with some of the largest retailers in the US - let's see if their definition of 'largest' is the same as ours.