If you eat out at restaurants, you have certainly noticed that prices are going up. If you’ve scanned the receipt at the end of the meal wondering why it exceeds the sum of the menu items you ordered, you may have seen fees and surcharges at the bottom of the bill in varying amounts. The rapid increase in charges is a shock to some diners who did not expect to pay as much as they have. J.J. McCorvey reports:
Notice something extra on your restaurant tab?
Rather than raise menu prices, restaurants are using new fees and surcharges to stick inflation into the fine print.
Fees for a “noncash adjustment,” “fuel surcharge,” or “kitchen appreciation” have been showing up on more bills lately. Industry analysts say this wave of surcharges is mostly being driven by restaurants trying to cope with the impact of rising inflation and a tight labor market on their bottom lines. In addition, Mastercard and Visa in April raised transaction fees for many merchants.
Lightspeed, a global developer of point-of-sale software, said fee revenue nearly doubled from April 2021 to April 2022, based on a sample of 6,000 U.S. restaurants that use its platform. The number of restaurants adding service fees increased by 36.4% over the same period.
“As the costs of doing business have changed, we’ve seen more merchants leverage this tactic,” said Peter Dougherty, Lightspeed’s general manager of hospitality.
The practice is similar to shrinkflation, when snack-food companies reduce the size of packaging or portions to make it harder to spot a price increase.
The fees are effective in part because unless people are paying close attention, many fail to notice them. When the bill arrived following a mid-April dinner at Romano’s Macaroni Grill, Lizzie Stephens was about to grab her wallet to pay. Instead, she pulled out her phone to Google the “temporary inflation fee” she noticed had been added to her check.
“I was just like—wow, now we’re getting fees at a restaurant, too?” said Ms. Stephens, 34 years old, who lives in the Stockton, Calif., area.
The charge was $2. She said it added to her overall annoyance about higher prices. Her landlord had just raised her rent by $150 in March. A single mom of two, she had just taken on a part-time gig to supplement her income.
The restaurant chain wasn’t immediately available for comment. Its website includes the following statement: “A temporary $2 fee will be added to offset macroeconomic pressures.”
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