The Commerce Tavern
Executive Summary
The Commerce Tavern was a popular restaurant located in Merchants Square, Colonial Williamsburg. H. Franklin Nilson established The Commerce in 1982, and he has been operating this restaurant very well. Recently, Nilson had a conversation with Anne Hamlet from The Virginia Merchants Bank about the acceptance of credit card consumption at The Commerce Tavern. VMB was willing to give The Commerce authorization of the use of MasterCard and Visa cards at the tavern. However, the general payment method of The Commerce was cash-only, Nilson was not sure if this traditional method could always working well for his business in a long term, and if he should make some changes on the cash-only policy. In
Therefore, the data of the eight restaurants could provide a good reference for The Commerce.
The credit-card usage of the eight restaurants in 1992 was shown as follows: Restaurant | Credit-card usage | Madison Inn | 39% | Lordsmill | 38% | Grecian Urn | 52% | Black Beard’ s Hold | 69% | Settlement Dining Room | 25% | The Sailty Dog Inn | 42% | Neptune’ s Seafood Pavilion | 44% | Peyton’ s Ordinary | 61% |
The median of the data above was observed as a usage rate of 43%, and then the data was divided in half again by 38% and 57%. These figures could be used as the reference data of The Commerce in 1993.

The average credit-card usage of the eight restaurants in the past three years was shown as follows: Restaurant | Average credit-card useage | Madison Inn | 39% | Lordsmill | 37% | Grecian Urn | 51% | Black Beard’ s Hold | 70% | Settlement Dining Room | 28% | The Sailty Dog Inn | 42% | Neptune’ s Seafood Pavilion | 45% | Peyton’ s Ordinary | 61% |
Through observation, the median of the data above was about a usage rate of 44%, which means the average level of the credit-card usage of the eight restaurants in the past three years was 44 percent. This figure could be used as the estimated credit-card usage of The Commerce. For Nilson’ decision of accepting credit cards fro payment, the credit-card usage rate of 44 percent made the acceptance of credit cards considerable to