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How Peeling Back the Layers of Contactless Payment Reveals Hidden Costs for Full Service Restaurants

Several months ago, prior to any knowledge of a global pandemic, contactless payment was an option that was “nice to have” for restaurant operators in the United States. Despite the data showing that restaurant guests value the convenience and security of a contactless payment option, it wasn’t something that all restaurant operators saw as a necessary part of their dining experience.


Fast-forward to today, and contactless payments are now a “must have” for operators re-opening their doors to a much different environment.Restaurants are doing everything they can to adapt to the new normal.But beware - there are hidden operating and financial costs that beset contactless payment on all sides.


Like a tear-inducing onion, the hidden costs come in layers. Operators will find that there are fixed costs, such as integration to the POS, as well as monthly operating costs, like software-as-a-service (SaaS) fees. There are transaction fees – which can be highly variable, but can have a material impact on a restaurant operation. And there may also be third party solution costs, or gateway fees. Some of these layers can be avoided or minimized, and in some cases they cannot. The key is to peel back each layer of the onion by asking the right questions:


How is the contactless solution designed and managed? What are the hours and the terms? Are there any aspects of the solution that require a third party?


By seeking answers to these questions, restaurant operators can determine exactly how a contactless payment solution works with their POS – which is critical to gauging expenses and controlling costs.


If a restaurant operator doesn’t know how their contactless POS solution works, they also won’t know if they are being properly supported. Operators need to have a plan for resolving future challenges, and they need to possess the ability to hold any solution provider accountable.


Good support is essential. A worst-case scenario is having a contactless solution that is far more complex to support than the POS itself – or worse yet, having to rely on an unknown third party to support it. Reliance on a third party can often result in finger pointing when operators are suddenly confronted with a challenge that requires help.


The key here is to keep it as simple as possible. Pick a contactless solution provider that takes full responsibility for the entire operation, from the integration to the POS, to the settlement of the transaction. Make sure one phone call resolves all of the unknowns and challenges.


Every onion, over time, will eventually grow sprouts. An experienced horticulturist knows that these sprouts can be planted to quickly generate new onions. It’s this understanding of how to peel back the onion when it starts to go bad, and how to get more from it that is essential to keeping things constantly growing.


Integrating a contactless payment solution is no different.Understanding how to dissect the technology and reveal the underlying financial and operating costs is critical to getting going.But also knowing how to address the situation when a contactless solution begins to grow sprouts will keep operations from getting tangled in the weeds.


How Peeling Back the Layers of Contactless Payment Reveals Hidden Costs for Full Service Restaurants


What are the hidden operating and financial costs of technology associated with Contactless Payments?


The hidden costs here come in layers. Some of these layers can be avoided or minimized, in some cases they cannot. The key is doing research and determining exactly how any EMV or Contactless Payment solution works with your POS. The key is asking the right questions.


1. How is your solution designed and managed? What are the hours and the terms? Are there any characteristics of your solution that require a 3rd party? While this seems a complex series of questions, if you don’t ask these, you really won’t know how it works. If you don’t know how it works, you won’t know how it will be supported… Who will take care of it should a challenge arise? You need to know how you want challenges resolved, and hold any solution provider accountable.

2. How is the solution supported? This is actually a key topic as you don’t want to end up with a solution that is far more complex to support than the POS solution you already have. Reliance on 3rd party solutions frequently results in finger-pointing when you confront a challenge. The key here is to keep it as simple as possible. Pick a solution that takes full responsibility for the entire operation, from the integration to the POS to the settlement of the transaction. Make sure one phone call resolves all unknowns and challenges.

3. How many layers of cost are there? The purpose of this question is to determine how many of the following layers of potential costs are involved;

a. Integration cost to the POS – generally a fixed cost

b. Monthly operating costs – normal SaaS fees for any solution

c. Transaction fees – Highly variable, but have a real impact

d. 3rd party Integration costs or solution

e. Gateway fees



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