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Reopening with a Restaurant Surcharge - Will it Work?

Restaurant Operations, COVID Resources - June 17, 2020 Written By: Krista Dinsmore

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As different regions begin to open up, business and restaurant owners are faced with new safety standards for social distancing and health & safety rules. For some locations, this may include reduced seating and customer capacity (25% - 50%), the requirement for staff to wear the appropriate PPE (personal protection equipment), enhanced cleaning regimes more frequently throughout the day, and much more.

Another challenge is that some areas are being affected by food supply chain issues, resulting in restaurant owners turning to different, perhaps smaller or local suppliers who are more expensive, therefore driving up the price of food ingredients.

All of these additional costs are adding to the economic pressure.

So what are your options?

Some restaurant owners have taken it upon themselves to add a small “safety surcharge” to their customer’s bill. This has been done by either increasing the menu prices to reflect the increased costs, or including the surcharge as an additional line item on the bill itself.

Now, if you’re reading this and thinking that this will cause negative feedback from your clientele, you’re probably right.

There will always be a group of people in the community who will contest being charged more when they have endured a hard time as well. This is why you should really consider if adding a surcharge will be accepted by the majority of your customers.

A recent survey conducted in the U.S. revealed some really interesting data, as we start to find out what the ‘new normal’ looks like from a restaurant consumer experience perspective.

The survey looked into how restaurant-goers will react to certain changes that could be implemented once reopening starts. Roughly 500 people were surveyed on their willingness to pay increased menu prices due to the increased health and safety precautions. The results were split into 3 groups that equalled roughly the same as each other. 34% of those surveyed said that they would pay an additional $1 on their bill, 27% said they would pay an additional $2-$9. And 37% said that they would not be willing to pay any extra fees if implemented to ensure their safety.

With these results, you can see that the majority of people are willing to pay a nominal amount, a dollar or $2 extra in order for their favorite establishment to keep up with safety standards.

Another question that was asked in the survey was, ‘what would be most appealing to diners when choosing a place to eat post-COVID lockdown?’ The number one answer was a written statement about health & safety cleaning procedures. Not only should this be required for all establishments, but you should also be transparent about any additional or increased costs being added to your customer’s bill.

A sushi restaurant out of West Plains Missouri did a great job communicating with their customers on Facebook by explaining in detail what additional costs their clientele could expect and how long they might be charged.

If any additional surcharges are to be added to the bill, be sure to be open and honest with your clientele. In one of our recent blogs we talked about gaining your customer’s trust - this is super important when it comes to the health & safety precautions but also if you are expecting customers to be paying more. Be sure to prepare and educate your staff on how to answer any questions regarding additional fees so that they feel comfortable and confident when discussing with customers.

We understand the financial pressure, but we encourage you to make surcharge decisions with careful consideration. Think about the size of your establishment and the number of tables that will be lost to adhere to capacity rules. And, think about the cost you’re incurring by increasing health & safety measures - do you need some help or is the cost minimal?

Whatever you decide to do, always be open and communicate these changes to your staff and customers. People will value your honesty.

Ready to get your bar or restaurant back up and running? We’re here to help. For an immediate audit of your inventory, don’t hesitate to reach out to us.

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