TSG Analysis

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Nov 2015

U.S. Holiday Spending Analysis

As Black Friday approaches, and the holiday shopping season officially kicks off, TSG and ETA have prepared an infographic to estimate the boost from holiday spending. In Q4 2015, TSG estimates a holiday spending boost of 4.7% compared to the baseline of January through September 2015. The data is sourced from TSG's data warehouse of over 3M card-accepting merchants in the U.S.

Oct 2015

TSG's Big Data: Halloween Costume Spending

The Strawhecker Group (TSG) looked at 12 months of spending data for over 500 clothing rental stores across the U.S. to see how Halloween impacts their monthly sales.

The top chart shows that in 2014, Clothing Rental Stores had sales of $42,500 in the month of October, 215% higher than the other 11 months. However, the bottom chart displays that the average purchase size fell 50% to $55 in October, versus $111 the rest of the year due to heavy discounting and the increased competition during the busy Halloween season.

For many costume rental shops, the Halloween shopping season accounts for a nearly a third of profits. This year, expect the competition between these merchants to be more intense as early spending.

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Oct 2015

Square IPO Analysis

When Square was launched in 2009, the market was intrigued to see how their dongle-based solution, with an easy boarding process and simplified pricing strategy, would impact the U.S. merchant acquiring space. It was a revolutionary approach to card acceptance and has since inspired many competing solutions.

Now six years later with an IPO pending, TSG reviewed Square's S-1 Filing and prepared the subsequent snapshot of their merchant portfolio in the U.S. market. Please note that this report contains estimates that should be viewed as directional in nature that reflect a blended time period over the past 12 months.

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Oct 2015

Enhance Your Value and Marketability

The Strawhecker Group (TSG), has released a brief overview on items to review when looking to enhance the value and marketability of a portfolio or a business.

Whether buying or selling, seeking investment funding, or planning an exit strategy - it is important to realize strengths and expose opportunities.

TSG has assessed hundreds of valuations and/or business assessments in the past five years - ranging in value up to $2B.

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Oct 2015

TSG U.S. Spending Report

The Strawhecker Group (TSG) has released its U.S. Spending Report covering the first half of 2015. This report provides a comprehensive look at same-store sales and consumer spending behavior by merchant categories and geographic breakdowns.

Consumer spending retreated in Q2 2015 versus Q1, putting a dent in a more pronounced second-quarter upturn in spending and leaving some less upbeat about the economy. The subdued spending growth during the first half of the year has largely been due to lower year-over-year gas prices. Although consumer spending growth slowed on a sequential basis, the year-over-year growth in overall spending remained positive. On the other hand, retail spending growth reversed course in Q2 2015 and entered into negative growth territory.

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Sep 2015

Chip Card 101 - Educational EMV Infographics

In conjunction with ETA's Chip Card 101 event taking place on October 1st, TSG has prepared educational infographics to provide merchants and consumers the essential knowledge needed to understand the liability shift. Payment industry players may want to utilize these tools as a merchant talk track.

The first infographic reviews chip card basics - what they are, why we need them, and the benefits to merchants and consumers alike. Click to view the high-res version.

The second illustrates how an individual will pay with a chip card in three easy steps: insert, keep, and remove! Click to view the high-res version.

Sep 2015

Payments Versus Sports: Perspective in Valuations

In recent years, payments companies have been some of the most valuable on Wall Street. Many of these companies have recently become publicly traded and are technology driven. For example, PayPal was founded in 1998, went public in July, and is already almost as valuable as the collective 32 NFL teams ($41 billion versus $45 billion, respectively). MasterCard and Visa went from membership organizations to publicly traded companies in 2006 and 2007, respectively; since that time, their value has increased drastically. While the members of the payments value chain might not get the press like sports teams do, they are what drives the economy, and the valuations reflect that.

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Aug 2015

EMV @ Restaurants: Not Often Black and White, But Gray

Last week's survey on EMV at restaurants yielded results from 27 payment providers that service restaurant merchants. Together, the respondents service over 170,000 restaurants.

"The card brands support tip add on for EMV cards in the same way that they do now with non EMV transactions. The authorization amount and the settlement amount (with tip added) can differ and will not be declined as long as all the other restaurant merchant processing rules are followed," according to the EMV Migration Forum and TSG.

As the statement above and the survey results show, tip add-on at restaurants with EMV is allowed by rule but sometimes constrained by technology. The sheer number of players in the payments value-chain makes EMV (and other ecosystem changes) very complicated in some scenarios, and as such, not often black and white, but gray.

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Aug 2015

TSG ANALYSIS: Has Square Disintermediated the U.S. Acquiring Market?

When Square was launched in 2010, the market was intrigued to see how their dongle-based solution, with an easy boarding process and simplified pricing strategy, would impact the U.S. merchant acquiring space. It was a revolutionary approach to card acceptance and has since inspired many competing solutions.

With rumors of an upcoming IPO, it seemed appropriate to overlap Square's growth metrics with attrition and other data for some context to evaluate if Square has disintermediated existing U.S. merchant acquiring providers within the SMB market. Please note that the charts below represent U.S. market metrics and do not include Square data.

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Jun 2015

Why Are Electronic Payments Important? [Infographic]

The Strawhecker Group (TSG), in coordination with the Electronic Transactions Association (ETA), has re-released an updated, and enhanced infographic entitled - Why Are Electronic Payments Important?

The purpose of ETA is to influence, monitor and help shape the Electronic Payments Industry by providing leadership through education, advocacy and the exchange of information.

This communication piece illuminates the crucial role that the industry plays in driving healthy economic growth and sustainability throughout the U.S.