In 1982, Arco tried a new marketing strategy by no longer accepting credit cards. This revolutionized the industry and gave Arco an edge against its competitors. This also saved the company nearly $73 million in credit card costs.
Now, almost 30 years later, Arco is attempting to bring the credit card back. Starting in the Seattle area, some Arco stations will start accepting credit card transactions. Arco has created a two tier pricing system for cash and credit. Reports indicate that the program may be expanded south to include Los Angeles and San Diego. The Los Angeles area is Arcos biggest market.
Arco was purchased by BP back in 2000 and continued its low-price, no credit cards policy. Since that time, Arco has retained its price edge, but the companys volumes and price differentials have dipped since it was purchased by BP. Also, other major brands have become more competitive.