There are certain hallmarks of the “business side” of restaurants – things like a heavy emphasis on cash transactions, complex inventory and supply chain processes, and frequent employee turnover. All of these make the restaurant industry a prime target for scammers, which means that understanding how scammers operate is crucial for restaurant owners to fully protect their assets.
Scammers lurk everywhere; sometimes they’re customers or vendors, while other times they might be restaurant employees. Often, the scams involve collusion among these groups. So what are some common scams that restaurant owners should look out for? Skimming One of the most common scams is skimming, which involves the theft of cash before it is ever recorded in accounting books. It could happen when an employee underreports the total sales amount for an individual transaction or time period, or when an employee simply pockets a customer’s cash without actually recording a sale. Skimmers can be hard to catch, but simple additions like security cameras or modern point-of-sale systems are among the best ways to discourage fraud. Phantom Suppliers & Ghost Employees Not all scams involve cash handling. So-called “phantom suppliers” set up fake companies that bill restaurants for goods or services that were never delivered. “Ghost employees” that don’t actually exist are sometimes added to payroll distribution by third-party payroll companies. Often involving collusion between an employee and an external partner, both of these types of fraud take funds directly from a restaurant’s bank account and deposit it directly to the scammers. The best way to combat these scams is constant vigilance. Restaurant owners should thoroughly vet vendors, review invoices against actual delivered product, and double check their payroll against a list of employees – especially if they’re using a third party payroll company for their wage distribution. Another best practice is separating employee duties to ensure multiple sets of eyes are watching every vendor interaction – for example, the employee who orders supplies should not be the same employee who receives the supplies when the vendor arrives. Reservation Scams Recently, reservation scams have seen a large boost in popularity amongst fraudsters. Sometimes customers might make a large party reservation under a false name with a stolen credit card, and then demand a refund to a valid credit card. If a reservation is in particularly high demand, customers might sell that reservation to someone else – a practice that has only picked up due to apps like Appointment Trader. The Appointment Trader app quickly makes multiple in-demand reservations at different restaurants and essentially lists them “for sale” on their own internal marketplace. This results in diners either paying a large fee for a free reservation, which could limit the amount they spend at the restaurant, or to the reservation not selling at all and resulting in a no-show party (and major loss of revenue) at the restaurant. A good best practice is to always double check customer identity and payment method on large or otherwise suspicious transactions. Should a restaurant discover that they’re listed on Appointment Trader without their consent, it’s important for them to take the proper steps to protect their brand and reputation. Have you been the victim of a scam? Let us know and we can warn your fellow restauranteurs!
0 Comments
What’s new: Today, Senators Joe Manchin (D-WV), Angus King (I-ME), and Kyrsten Sinema (I-AZ), joined 47 Senate Republicans in voting to nullify the National Labor Relations Board’s (NLRB) joint employer rule. The measure passed 50-48. Senator Josh Hawley (R-MO) voted against it and Senators Lee (R-UT) and Menendez (D-NJ) did not vote. Thank you to everyone who helped us get this vote across the finish line!
What’s next: The joint resolution of disapproval, which has previously passed the House, now heads to the President. However, the President has previously stated that he will veto it, undermining the will of the tripartisan majority of U.S. Representatives and Senators. Go deeper: On March 8th, the judge overseeing the legal challenge to the NLRB’s 2023 joint employer regulation agreed with the Restaurant Law Center, the U.S. Chamber of Commerce and the other plaintiffs, forbidding enforcement of the 2023 joint employer rule against any National Restaurant Association member. The court reinstated the 2020 joint employer rule, which we support, that creates a joint employer relationship only if there is immediate and direct control of the employees of the other business entity. We expect the NLRB to appeal the decision to the Fifth Circuit while simultaneously attempting to move forward in the DC Circuit Seventy members of the Louisiana Restaurant Association (LRA) convened at the Capitol for a pivotal event known as LRA Day. This gathering provided a platform for industry leaders to address pressing issues facing the restaurant sector. Among the distinguished speakers were LRA President and CEO Stan Harris, Louisiana Commissioner of Insurance Tim Temple, and Senate President Cameron Henry, each delivering valuable insights into the legislative landscape shaping the industry's future.
Harris took the stage to deliver a keynote address that shed light on various challenges confronting restaurants across the state. He highlighted recent legislative victories and ongoing battles against detrimental bills, emphasizing the importance of thwarting measures that could hinder restaurant operations. Particularly noteworthy were discussions surrounding credit card service charges and cash payment mandates, which could significantly impact the industry's bottom line. In addition to legislative concerns, Harris addressed the complexities of setting a statewide minimum wage, drawing parallels to experiences in California. He underscored the LRA's unwavering support for the domestic seafood harvesting industry while navigating potential cost increases for imported seafood wholesalers. Moreover, Harris outlined insurance hurdles faced by restaurateurs, from workers' compensation issues to soaring commercial property insurance costs. Temple's presence added depth to the discussion, offering insights into insurance reforms and the Louisiana Citizens program's impact on homeowners. His remarks provided clarity on the steps being taken to address the crisis in property insurance and build a more vibrant and cost-effective future market. Senate President Henry rounded off the proceedings, urging LRA members to engage directly with lawmakers to ensure their voices resonate in legislative chambers. He emphasized the importance of advocacy and collaboration in navigating the fast-paced legislative agenda. Following Senate President Henry's inspiring discourse, LRA members were invited to visit the Capitol themselves, where they had the opportunity to speak directly with state representatives and senators about their specific concerns. This hands-on engagement underscored the importance of grassroots advocacy and the impact of direct communication with policymakers. During the Capitol visit, Istrouma and Tara High School ProStart students provided cuisine samples. Their participation illustrated the industry's commitment to attracting and preparing the next generation of leaders. In a touching moment, Istrouma High ProStart Educator Patricia Cooke was honored as the LRAEF Educator of Excellence for 2024. Representative Ed Larvadain, a high school classmate of Cooke's, presented her with a legislative proclamation in the House of Representatives, recognizing her outstanding contributions to education and the culinary arts. The event culminated in a reception at the LRA House, where participants had the opportunity to mingle and reflect on the day's discussions. Cuisine was provided by Drago’s Seafood Restaurant and City Pork in Baton Rouge. As attendees departed, they carried with them a renewed sense of purpose, fueled by a shared commitment to championing Louisiana's vibrant restaurant industry. The success of LRA Day underscored the collective dedication of industry stakeholders to advocate for positive change and navigate the challenges and opportunities that lie ahead. April 1, 2024 – Metairie, Louisiana: - In a world where emojis reign supreme, the Louisiana Restaurant Association (LRA) is taking a bold stand against a grave injustice: the glaring absence of an etouffée emoji. In recent years, we've witnessed a disturbing trend across every variety of smart device: the proliferation of emojis for everything from sushi to spaghetti, yet no representation for the beloved etouffée. This egregious oversight has left Louisiana cuisine languishing in the digital dark ages, deprived of the recognition it so richly deserves. "A mandatory, state-wide keyboard lockdown has been issued," declares Stan Harris, President and CEO of the Louisiana Restaurant Association. "For too long, Cajun cuisine has been relegated to the sidelines of emoticon development, while lesser dishes bask in the glow of digital fame. The deliberate exclusion of a time-honored entree will not stand, and we are calling for immediate action from the tech titans of Silicon Valley to rectify this outrageous oversight. I’m dead serious." Exhaustive research and excessive text chains have concluded that emojis play a crucial role in shaping cultural perceptions and fostering modern-day communication. By flagrantly omitting the etouffée emoji, tech companies are sending a clear message that Louisiana cuisine is somehow unworthy of representation in the digital realm. "We're not just fighting for a graphic the size of a grain of rice," clarifies a spokesperson for the LRA. "We're fighting for the soul of Cajun cuisine and the cultural heritage it represents. It's time for these condescending coders to recognize the importance of a savory symphony of seafood, spice, and the essence of Louisiana’s bayou bounty, by immortalizing it as a fun little picture to keep the correspondence cute.” In response to this culinary outrage, the LRA has launched a national campaign to raise awareness about the plight of this beloved delicacy and mobilize support for its rightful place in the emoji pantheon. From social media blitzes to petition drives, our mission will be to rally supporters far and wide to join the crusade. Our cries for inclusion will ring out from bayou to boulevard and our voices shall be heard, demanding that the tech overlords get with the program and send out a software update featuring the vibrant etouffée emoji that we have long been denied! No roux will be left unstirred in this quest for equality; in other words, we will totally call for congressional support if the California geek squad refuses to play ball. So, to all the tech giants out there, we have one simple message: add a poboy while you’re at it. Embrace the rich tapestry of Louisiana cuisine and give it the recognition it deserves or prepare to face the wrath of the Cajun nation. For media inquiries, please contact: Fox 8’s Lee Zurik Don't let the term "Mom and Pop" give you the impression that these business owners aren’t sophisticated. In the realm of restaurants, it signifies a world of dedication, versatility, and unyielding passion. A restaurant owner can seamlessly transition from chef to host, electrician to human resources manager, all in the span of a single day. This level of multitasking and commitment is emblematic of the extraordinary efforts put forth by those who helm independently owned and family-run eateries.
Consider Louisiana, where the culinary landscape is as diverse and flavorful as the state itself. With over 9,000 eating and drinking establishments, a staggering 80 percent of which are independently owned or family-run, these restaurants are not merely places to dine – they are bustling hubs of creativity and community. National Mom and Pop Business Day, observed on March 29, serves as a timely reminder to appreciate and support these local culinary gems. Behind every savory dish and welcoming ambiance lies a story of perseverance and artisanship. More than 200,000 residents in Louisiana depend on restaurants for their livelihoods, highlighting the critical role these establishments play in supporting local economies and driving tourism. So, the next time you step into a local restaurant, remember the countless roles its owner plays – from chef to caretaker of community traditions. Embrace the richness of Louisiana's culinary heritage and support the unsung heroes who bring it to life, one delicious meal at a time. Serving Up Technology: New Data Shows How Tech Integration is Transforming the Restaurant Experience3/27/2024 National Restaurant Association Technology Landscape report showcases industry innovation and where consumer desires are pushing trends
Technology use in restaurants is accelerating, creating new touchpoints between restaurants and the consumers they serve, according to the National Restaurant Association’s Restaurant Technology Landscape Report 2024. The report, released today, identifies the varying expectations consumers have regarding technology, depending on whether they are dining at a fullservice restaurant or ordering delivery to their homes, as well as generational differences in preferences. "Restaurant operators have tremendous entrepreneurial spirit, and they are constantly innovating – sometimes through new dishes or flavors, and sometimes through new business practices,” said Michelle Korsmo, President & CEO of the National Restaurant Association. "More than 3 in 4 operators say technology gives them a competitive edge, and this research will also help operators find the right technology fit for their restaurant and their customers. In addition to valuable research on restaurant operator outlook, our research on the technology landscape in restaurants provides insights on consumer expectations that operators need to confidently evaluate their tech investments." Key highlights include:
Restaurant operators are getting creative in how they expand technology offerings, paying close attention to consumer preferences, but generational differences persist. When asked how likely they’d be to interact with a tablet at the table, a solid majority of Gen Z adults, millennials and Gen Xers say they’d use these options but fewer than half of baby boomers said they would. Compared with fullservice and limited-service options, the use of technology in the delivery segment is already baked into consumers’ expectation. They expect to be able to access, order, customize and pay for delivery orders through their computers or smartphones and if they can’t, they’ll order from somewhere else. "The data clearly show that restaurant operators and owners are rapidly embracing technology and integrating it into their daily operations," said Hudson Riehle, Senior Vice President of Research and Knowledge for the National Restaurant Association. "Understanding which technologies customers in each segment would like to have, really want, and consider essential, provides operators with substantial opportunities to enhance the customer experience, amplify marketing and operate more efficiently." Click here to download the Restaurant Technology Landscape Report 2024, supported by Dell Technologies and SpotOn. On March 26, a proposed settlement agreement was announced requiring Visa and Mastercard to reduce swipe fees charged to restaurants and other merchants to process credit card transactions starting in April 2025.
While this news is welcome, it merely provides temporary relief while allowing credit card companies to raise rates in the future. The bottom line is that these proposed reductions are within the range that Visa and Mastercard have raised swipe fees over the last few years, which rose from an average of 2.02% in 2010 to 2.26% in 2023. The banks and networks will argue that the settlement obviates the need for the Credit Card Competition Act (S. 1838/H.R. 3881), but the CCCA remains as the best solution to bring about the long-term, systemic reform required to fix the broken credit card processing market. Go deeper: The settlement creates three separate “brakes” on swipe fees through rollbacks or fee caps that are worth an estimated $29.79 billion in unrealized savings for businesses and consumers over the next five years:
Tax Relief for American Families and Workers Act of 2024 What just happened: The Tax Relief for American Families and Workers Act has momentum coming into the Senate, following sweeping bipartisan votes in both the House tax committee (40 – 3) and on the floor (357 – 70). The Senate has an opportunity to push forward this legislation that supports restaurant and Main Street business growth. What supports restaurant operators: 1) Restoring business interest deductibility based on the earnings before interest, taxes, depreciation, and amortization (EBITDA) standard rather than earnings before interest and taxes (EBIT).
2) Allowing 100% bonus depreciation for equipment purchases like kitchen ovens, furnishings, a catering vehicle, and other capital assets that are common in restaurants.
Why support it? While the Senate may want to explore improvements to H.R. 7024, this legislation is the best way to deliver badly needed tax relief to Main Street businesses – including restaurants.
Child tax credit: The bill increases the amount of the child tax credit (CTC) for lower-income families with multiple children, creates an automatic inflation adjustment, expands refundability, and other changes.
Why pass this bill now? If the Senate does not advance this legislation, solving the challenges of expiring tax rates and measures in 2025 will become even more difficult. The 118th Congress has the chance now to set a baseline for pro-growth tax measures that will make the U.S. economy more competitive globally and to support local restaurant owners in small towns and big cities.
CHEERS Act Passes U.S. House, Heads to U.S. Senate: Offers Tax Relief for Hospitality Revival3/21/2024 The CHEERS Act, also known as the "Creating Hospitality Economic Enhancement for Restaurants and Servers Act," has passed the U.S. House of Representatives and is now awaiting consideration in the U.S. Senate.
This bipartisan legislation, introduced by Representatives LaHood and Horsford, seeks to provide tax deductions for bars, restaurants, and entertainment venues with draft beer systems, aiming to revitalize the struggling hospitality sector post-pandemic. The bill has garnered widespread support from various industry stakeholders, including the Beer Institute, National Restaurant Association, Independent Restaurant Coalition, and Brewers Association, who recognize its potential to stimulate job creation, economic growth, and sustainability in the beer and hospitality industries. "The CHEERS Act would give restaurant and bar owners new tools to innovate how they serve beer to customers,” said Sean Kennedy, executive vice president for public affairs of the National Restaurant Association. “The result would be more consumer choice, strengthened sustainability options, and needed support for restaurant owners in every neighborhood." The U.S. Dept. of Labor's (DOL) new overtime rule is poised to affect millions of workers across various restaurant types, not just quick service.
Now’s the time to proactively adjust your pay practices in anticipation of the DOL's proposed increase in the exempt salary threshold. Fisher Phillips (LRA General Counsel) provides this 8-step plan to effectively prepare for these changes. |
About the Blog Archives
April 2024
Categories |