Why Restaurateur John Howie Eliminated the Surcharge at His Bellevue Steakhouse

How a surcharge on restaurant tabs turns off patrons.

This article appears in the June 2018 issue. Click here for a free subscription.

Restaurateur John Howie has eliminated the 3 percent surcharge he was adding to patrons’ tabs at John Howie Steak in Bellevue after realizing it was a monumentally bad idea.

Howie instituted the charge in March 2017 and applied the additional income to covering “a myriad of new employee costs, including minimum wage increases, expanded health insurance requirements, and new family and medical leave mandates.”

After going on vacation and registering “shock and dismay” at a $3 water fee added to his bill for a round of golf, he nixed the surcharge and instead made “minor price adjustments” to the menu.

“When I wondered aloud why the fee wasn’t just added to the greens fees, my wife responded, ‘Oh, it’s kind of like your …’ before catching herself and saying nothing more.”

In that moment, he said, he understood “how our surcharge felt to our guests.”

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