Vt. store ditches the penny

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September 10, 2012, 6:38 pm
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(NECN: Jack Thurston, Morrisville, Vt.) - At Power Play Sports in Morrisville, Vt., Caleb Magoon's price gun still spits out labels that end in $.99, but when he goes to the cash register, he has no pennies inside.

"We don't actively go out and get pennies in order to give people the appropriate change," Magoon said.

Starting this month, the sporting goods store is rounding its change to the nearest nickel. It does so in the customer's favor, Magoon said. If you're owed $1.63 from a cash purchase, for example, you will now actually get back $1.65, he explained.

"The most I could possibly lose on any transaction is four cents," Magoon added.

This is his way of suggesting the United States follow Canada's lead, and stop production of the coin. It actually costs the government nearly two and a half times more to produce the penny than it's worth, according to the U.S. Mint's website.

Rick Vanden Bergh, an associate professor at the University of Vermont's School of Business Administration, agreed that having the cent makes little sense. He told New England Cable News that all the time spent counting coins and making change is inefficient for retailers and customers alike, and is outdated, too.

"You can't buy anything with a penny," Vanden Bergh said. "The vast majority of what we do is electronic transactions, so you can still have electronic transactions to the penny."

Of course, lots of folks would never want to see the penny go away. They worry losing the one-cent piece would lead to a slight increase in consumer prices across the board. Others like having the coins because it's what they're used to, and some fear the potential impact on charities.

"We survive on the nickels and dimes and pennies," said Capt. Bill Thompson, the commander of the Salvation Army chapter that serves the Burlington, Vt. area.

Less change in our pockets could mean less in his kettles at Christmas, Thompson said. He told NECN the group would then be unable to do a lot of its outreach work. Plus, he has found children learn to count with the help of pennies.

"I think it has a lot more value than we give it," Thompson said of the penny.

Back at Power Play Sports, customers carrying credit cards and checks still pay every last cent. Caleb Magoon said cash users only make up about a tenth or a twelfth of his customers, so he predicts he won't lose much more than $25 a year in pennies.

"I'd say 85- to 90-percent of the transactions, it's not going to affect," Magoon said of his move. "But for cash transactions, it's just not going to make a huge difference either way, it's just going to save the U.S. Treasury a few dollars."

Magoon wonders if his experiment of rounding the change for cash users could have a small ripple effect. He predicted one day we'll see fewer Abe Lincoln profiles with our receipts.

"It's not really needed," he said.

Tags: Jack Thurston, morrisville vermont, penny, caleb magoon, power play sports
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