Chip away at avoidable overhead costs Though the cost of food and labor tend to make the most headlines when it comes to current industry challenges, those aren’t the only budget line items on the minds of restaurant operators right now. According to the National Restaurant Association’s 2023 State of the Industry Report, a commanding majority of respondents are spending much more on overhead costs – including those for insurance, utilities, licenses and other items a restaurant needs to run – than they were a few years ago. While some costs are out of an operator’s control, there are a number of expenses that can be minimized with some planning. Consider insurance, for one. In addition to simply shopping around for the best quote, you can take steps to position your business for a better deal. While insurance prices are increasing across the board, insurers will provide better terms to a risk-aware business. Demonstrate your sound risk management by ensuring your fire alarm, sprinkler system and security cameras are up to date and functioning well. Document your staff’s safety training and provide evidence of your strong (or improved) accident record. If you do have a solid safety history, consider increasing your deductibles so you pay lower premiums each month. If your business has made major changes to its physical premises or how it operates, make sure you update your policies to account for those adjustments so you can avoid gaps in your coverage. Finally, if you’re in the market for several types of insurance, such as liability, property and cyber protection, for example, look for a provider who can offer a bundled package that can save you money – and ensure they have a solid record on claims payment. So many of our payments have become contactless in the past year – and businesses have felt the need to offer card-not-present payment options in an effort to maintain safety, enable off-premise food purchases and promote customer convenience. But as card-not-present transactions have climbed alongside food delivery orders in the past year, so have the opportunities for fraud. Research from Aite Group forecasts a 16.4 percent increase in card-not-present fraud this year. This fraud can hit restaurants with chargebacks that are difficult to dispute, but fortunately there are steps restaurants can take to help detect and prevent fraud. Overall, it’s about identifying patterns about your customers – who they are, how they are ordering, are and how they are finding you. Machine learning tools can help you identify what good customers look like – then flag those that look risky. For example, an order placed from a city other than the one listed as the delivery destination might raise a red flag for a restaurant business. ATM Marketplace advises having a fraud-protection provider that helps screen every transaction – and it’s important for the restaurant to partner with them to ensure the system is adaptable to the business. In a recent webinar entitled “How to Protect your Restaurant from Online Scammers,” Brittany Allen, Trust & Safety Architect at Sift, advised restaurants to use fraud detection systems that provide an activity log that lets them view a customer’s session history, and which use a single dashboard that eliminates the need to jump from tool to tool. Beyond that, Allen said a restaurant operator should know how different fraud alerts rank for their business – and what kinds of fraud similar businesses are facing. Finally, a system should allow you to take action somehow, whether to flag a suspicious transaction for further review or to stop a transaction from occurring.
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