Has anyone managed to work out what an ‘industry service charge’ is in relation to this restaurant chain?
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Yes. It means we are increasing our prices and have exercised our imagination to the utmost to obscure this. We hope you think it is special and has some meaning because as far as we can tell it doesn’t.
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Extra industry profit above the normal profit.
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Well I think it is basically saying that the displayed price is not what you will actally pay.
Like in the US where businesses will add on extras like taxes to the displayed price. Or tips.
Let’s hope that this is just an isolated case of a business acting in an manner that doesn’t become more prevalent.
Surcharges are one thing. For payment method, or days when staff costs increase like Sundays or public holidays, but simply putting a mandatory extra charge on the top of the displayed price without explanation must be sailing very close to the wind as far as unconscionable behaviour is concerned.
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Truth be told, it would probably be more costly in the long run, with unseen costs, for a business to accept cash. Time and security to balance tills (what if there’s been an error in change given?), preparing banking, staff time to deliver to bank-whether by night safe deposit or lining up at tellers…shhhh, don’t tell 'em!!!
Not that I know first hand, what I might know. Smaller businesses can be more than happy to have a smaller portion of their turnover in cash.
When might it be a benefit or advantage?
- If you are small store on a rural area with doubtful internet service.
- If you are a one person would be restauranteur, aka food or coffee van and can’t get easy credit from some of your local smaller suppliers.
- If you are well acquainted with keeping it tax audit compliant.
Of course with Covid, even the regular store holders at the farmers market now have a cashless option. As a customer with cash the sales are often rounded down to the nearest whole dollar. If it adds up to $31.35 and you offer a $50. You may get a $20 back, it all depends.
Of course when paying cashless there may or may not be a surcharge. Where there is side by side competition adding a surcharge is one way to standout from your competitors.
For this reason, we no longer go to the “BAVARIAN”. I like to know what I have to pay when I order and not be forced to make mathematical calculations that also vary depending on the day of the week.
Just imagine if Coles or Woolworths had a similar Surcharge Policy, e.g. 10% more if you are shopping for large families, or a surcharge after 6pm and another 5% if it’s on a public holiday…
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If one goes with a group (ones pays which is often the case as many places don’t allow splitting of bill), to work out what amounts apply to each person becomes a diabolical nightmare.
The surcharges outlined above would also make us…
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Some places in Melbourne over the Australia Day day were charging a 15% surcharge without providing notice. Greedy in my opinion!
Public holiday in case you didn’t know. Employee penalty pay rates well in excess of 15%.
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@Gregr Thanks for picking up that, I had edited to add the missing from the menu part while on my phone but it got lost. I have now appended to the post to include what was missing.
I don’t mind when I am made aware on entry as I can make the choice to eat there, but these were not not displayed on entry or on the menu. I had to ask when paying and then was told why the 15% was added to the bills.
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Whilst this is true, the surcharge is if 15% the total bill, not 15% the employee’s pay. Whether it is excessive or not, only the restaurant owner would know and they are unlikely to tell us if it is.
Permanent employees may get 225% or 250% of their normal pay for working on a public holiday. However if the business closed on that day, the employee would still get a full day’s pay for not working. This means that the employer effectively only has to pay 125% or 150% of a standard day’s pay in exchange for the employee working on that day. In such cases, charging 115% of the normal food and drink prices is likely to more than cover the extra wages for the day.
That is only correct for permanent full and part time employees, not casual staff. Casual staff have holiday and leave loading amounts built into their basic wages. As for penalty rates while this is VIC it reflects the national norm.
A new instalment on ‘surcharge ethics’. Seems many are using surcharges for more and more rather than including their costs into a real price that has become a ‘faux menu price’ that is increasingly plus mandatory surcharges. No semantic arguments are needed to see what is happening.
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From the article you have linked:
Pacific Concepts later confirmed all its restaurants required customers to pay a 6.5 per cent venue surcharge and labelled it as “commonplace” across the industry.
“Card processing fees and service charges are commonplace across the Australian hospitality industry and cover various costs incurred by businesses,” a spokesperson told news.com.au.
*“We are fully transparent about charges, which are noted on our menus, websites, and receipts across Pacific Concepts restaurants.”
When checking the Pacific Concepts website, I was unable to find any reference to the 6.5% surcharge and the only surcharge references I located were located at the bottom of menus for the various restaurants (see example below).
Some people have a strange definition of the term “fully transparent”. This may qualify the spokesperson for a long career in politics.
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