That jumped out at me too -- so I looked up what appears to be the source [1] and it does indeed state:

> "Regardless of size, the fees are most merchants’ highest operating cost after labor"

but I'm as incredulous as you are. Obviously things like cost of goods, and also usually rent, are also going to be higher.

I can only assume it's based on some really misleading survey, and I'm honestly surprised to see The Economist, of all publications, repeat something so obviously economically questionable. (To be sure, they attribute the claim rather than state it, but they present it as if it's true.)

[1] https://nrf.com/media-center/press-releases/retailers-say-sm...