Food by VICE

Restaurants Harassed for Adding 'COVID-19 Surcharge' to Customer Bills

The cost of meat is going up as the pandemic rages on, but who should foot the bill: restaurants or their customers?

by Jelisa Castrodale
May 14 2020, 10:04pm

Photo: Getty Images

One of this week's mildly viral tweets was a photo of someone's thumb pressed against a crumpled restaurant receipt from a Japanese restaurant in southern Missouri. In addition to the cost of four sushi rolls and two 25-cent sides of yum-yum sauce, Kiko Japanese Steakhouse and Sushi Lounge had also added an additional $2.19 "COVID 19 surcharge" to that customer's total bill.

"Scuse me ... what? A covid surcharge?" was how Twitter user @talialikeitis captioned the pic when she posted it. Some of the responses were sympathetic to the restaurant, and assumed that the extra fee was to cover the cost of PPE for its employees or to help it recover some of the money it lost after six straight weeks of takeout or delivery orders only. Others were predictably angry, using ten exclamation points to call it "B.S." or blaming it on "demons" who were using the money to "help fund [...] the police state."

According to the restaurant itself, it's because the costs of meat, seafood, and other ingredients have significantly increased, and adding a temporary charge is easier than changing the prices of everything on its menu. "We've been putting flyers in front of our restaurant and put the surcharge on your receipt," Kiko Japanese Steakhouse posted on its Facebook page last week. "Today we put more signage [in the restaurant]. Please understand, we can't control the rising cost of meat, seafood, poultry and produce. We are at the second bottom of supply chains before you! We only [sic] doing this for temporary only, we plan to take this surcharge off once all the prices back to normal."

But because of the backlash from social media, or because Kiko Japanese Steakhouse was one of the first places to add a "COVID surcharge," or both, the restaurant quickly changed course. In a follow-up Facebook post, it said that its employees were being harassed by customers and, because it wanted to make the abuse stop, it said that it would do away with the extra charge and would adjust its prices instead.

Bootleggers BBQ, which is also in West Plains, Missouri, tested a similar pandemic-related surcharge—and the restaurant faced similarly awful backlash for it. Owner Brian Stack told VICE that he decided to add a 5 percent across-the-board surcharge to all orders to cover the price increases on the beef, chicken, and turkey that make up most of the restaurant's menu items.

"Being a BBQ restaurant, we are very protein-heavy, and these proteins are what have gone up the most. I deal with Sysco and US Foods, but have access to four different distributors, and currently none of them have one of my best-sellers, beef brisket," he said. "The last case I was able to order was $8.19 per pound, compared to the $2.79 per pound that I used to pay. That's a huge jump that, no matter how you plan your menu, you can't overcome. Ground beef has more than doubled in price, our chicken and turkey has seen an 8-percent increase, and our pork butts have gone up about 15 percent, but the cases I got today are the last any of my suppliers have."

Stack feels fortunate that the restaurant's business has stayed steady, but even that's not enough to cover those steadily increasing protein prices. "We operate on a 1-percent profit margin. Our food costs are higher than most restaurants' to begin with, because of the quality of meats we use," he said. "Plus we pay our employees above-average wages. They're the lifeblood of the restaurant, and we treat them like family. When prices increase as much as they have, even with the 5-percent surcharge, we are operating at a loss."

His original idea was to start by adding a 5-percent surcharge, and then carefully study his twice-a-week delivery invoices and then decide whether to adjust the fee up or down. Instead, he and his staff were subjected to so much backlash that he changed his mind after two days.

"Our customers supported us and didn't mind, but the social media backlash was horrible," he said. "There is never a reason for the phone calls my employees were getting. I had someone threaten my life, several tell me they would burn the restaurant down, and countless other horrible things. My employees don't need to worry about getting harassed at work, so I dropped the surcharge and went through the menu [to make changes] on Monday." (He also said that "only two" of the hateful phone calls were from people who lived in Missouri.)

Stack says that he had to raise the prices of Bootleggers' most consistently available entrees from anywhere between "pennies" to several dollars. And now a restaurant that is already operating at a loss had to pay another $300-plus to have new menus printed—and he said that he's probably going to have to adjust the prices and spend an extra $300 every week to reprint the menus "for the next month or so." (Bootleggers also has a reputation for doing what it can to support its community. Last month, the restaurant gave away 10,000 BBQ meals in 10 days to front-line workers, first responders, and "those just needing a meal.")

There are nationwide supply chain shortages due, in part, to the number of meat-processing plants that have had to temporarily close. We're all paying more for groceries, especially for meats, and that's not going to change; some industry analysts have predicted that the prices of beef and pork could increase by 20 percent compared to last year. Obviously, that's going to affect restaurants too, and we're ultimately going to be paying more for our favorite meals—so why should it matter whether they add a surcharge to the total or increase the prices on the menus?

A couple of other restaurants in Michigan and California have also started to add coronavirus surcharges. If that's what it takes to help these smaller places stay open, will customers choose to support the businesses they love and keep their mouths shut (other than to say "Thank you for being here, I can't imagine how hard this has been")? Guess we'll find out.

Tagged:
missouri
Barbecue
Coronavirus
quarantine
COVID-19
bootleggers bbq
kiko japanese steakhouse