Restaurants layer on new fees to counter inflation
The next time you get a receipt, consider taking a closer look.
Why it matters: While Americans already grappling with record inflation are less surprised by the rising costs of goods, many are finding new fees taking a bite out of their budgets.
- Businesses are getting creative with new fees and charges from the "fuel surcharge" to deal with high gas prices, a "noncash adjustment" for using credit instead of cash, "kitchen appreciation fees" or simply a "temporary fee."
By the numbers: The number of restaurants adding service fees increased by 36.4% from April 2021 to April 2022, Lightspeed, a global developer of point-of-sale software, told The Wall Street Journal.
- Romano’s Macaroni Grill says on its website that a $2 “temporary fee” is being added to bills to “offset macroeconomic pressures.”
- Mastercard and Visa raised transaction fees for many merchants in April, which the National Retail Federation along with a group of retailers said was "driving up inflation."
Flashback: Early in the pandemic, businesses started adding fees like a disinfection charge or the cost of personal protection equipment.
- The New York City Council allowed restaurants to temporarily add a "COVID-19 Recovery Charge" of up to 10% of total bills but required that the menu and bill clearly disclosed the charge.
What they’re saying: “As the costs of doing business have changed, we’ve seen more merchants leverage this tactic,” Peter Dougherty, Lightspeed’s general manager of hospitality, told the Journal.
- Ted Rossman, a senior industry analyst, CreditCards.com, told Inc.com that consumers want to be presented with one price.
- "They don't want to be nickel and dimed for everything from the air conditioning to the cleaning supplies to their employees' health insurance," Rossman said.
Reality check: Some of the extra charges are clearer than others, like when restaurants specify menu items have higher costs for delivery orders and service fees may apply.
- Experts advise reading the fine print and if a fee isn't properly displayed or listed, ask for more information.
Fuel surcharges added amid rising gas prices
Ridesharing and on-demand delivery apps added fuel surcharges in March to "help drivers" combat high gas prices.