Navigating COVID-19 Surcharges

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The restaurant industry has suffered greatly from the coronavirus pandemic. Many business owners seeking to survive and stay open through the extended crisis are seeking methods for offsetting the new costs that they face. In a recent article for Modern Restaurant Management, Ben Walker examines one common method—COVID-19 surcharges—and offers some tips for making them more palatable to customers.

Generally, restaurateurs choose one of two methods for establishing a COVID-19 surcharge: they either raise menu prices across the board or simply add an extra fee to the total bill. You are probably not surprised to hear that customers are not a fan of either approach. Here are some tips for making COVID-19 surcharges more appetizing to your restaurant customers:

  1. Communicate clearly and up-front about new charges. Post your new policy on social media and post it physically on signs in your store. Be sure to share the “why” behind your change—let your customers know that the additional charges go toward keeping your staff and clientele safe and your business clean and sanitized.
  2. Understand that you will still have unhappy customers. Regardless of how you choose to structure the charges and communicate about them, you will simply have some clients who are unhappy about the changes.
  3. Approach any disputes arising from the surcharges with a respectful attitude. Regardless of how well you communicate about the new charges, it is likely that disputes will arise. Be sure to educate your staff about the plan of action for when this happens.
  4. Pay attention to if and how the surcharges make your staff’s lives harder. Survey results indicate that many consumers would tip less if their bill increased due to coronavirus. Knowing this, consider taking steps to supplement your front-of-house staff’s income to make up for losses stemming from poorer tips.
  5. Look into other sources of business cash flow. During these trying times, even adding surcharges to your bills may not be enough. Consider exploring other sources of liquidity, such as a business credit card, to offset your increased costs.

For further details, click here to read the article in full.