Operations: Handy Swipe

To speed the checkout process and help prevent credit-card fraud, more operators are laying their card readers on the table.

By Christine LaFave, Associate Editor -- Restaurants & Institutions, 2/1/2008

As Boston-based seafood giant Legal Sea Foods rolled out pay-at-the-table technology last year, company executives waited eagerly for the reaction of customers at the last group of restaurants to convert to the new system: suburban Legal Sea Foods units, which have a higher proportion of older diners.

To execs’ surprise, older customers embraced pay-at-the-table as eagerly as anyone had. "They’ve shocked us with their adaptation to the new technology," says Ken Chaisson, vice president of information technology at Legal Sea Foods.

The chain began incorporating the system—whereby a server brings a handheld card reader to the table and passes the reader to guests or swipes guests’ cards for them—in 2006. By the end of 2008, all locations will have pay-at-the-table in place.

For Legal Sea Foods, the technology has two main benefits. First and foremost, it prevents customers from having to hand over their card to a stranger—"[Foodservice] is probably the only industry around where you give your credit card to somebody and they walk away with it," Chaisson says. Second, it helps the restaurant turn tables more quickly.

"When the server does it the right way, the guest walks away much quicker ... and with a smile on their face," Chaisson says. The novelty of the technology is amusing to guests encountering it for the first time, he says, but of more importance, pay-at-the-table allows servers to complete a transaction in 60 seconds. Guests no longer have to wait five or 10 minutes for a server to return with a card—time valuable to workers on a lunch break and dinner guests on their way to an event.

Handheld readers can also simplify the process of dealing with split checks. The pay-at-the-table readers in place since early 2007 at Aqua Blue in Roswell, Ga., offer a "multiple payments" option; Chef-owner John Metz says that parties as large as 15 have closed their tabs by simply passing the reader around the table. "[Customers] are happy we’ve taken the initiative to do it," Metz says, adding, "It’s really kind of fun—it’s interactive for them."

Self-checkout systems—already common in Europe—can yield unexpected benefits, too, say Chaisson and Metz. Boston Legal Sea Foods locations see a significant amount of tourist traffic, Chaisson says, and a suggested-tip prompt (15%, 18% and 20% tips are listed) has led to higher tips from European tourists used to seeing a smaller gratuity included on their bill.

Tip Computations

Both Chaisson and Metz say the move has been worthwhile—although it hasn’t been without challenges. "It’s been much more of a struggle trying to convince servers to use the new technology than the guests," Chaisson says. A major point of contention was the fact that the card readers’ suggested tip amounts were computed on a pretax rather a post-tax basis.

However, in Legal Sea Foods’ analyses of food-and-beverage and tip totals for individual servers, the company found that servers received more tips when they closed a check using a card reader than when they didn’t. Chaisson adds, "If you can turn one more table [by using self-checkout], you’re going to more than make up for that pretax versus post-tax."

Looking beyond merely self-checkout, San Diego-based Jack in the Box is testing in-store self-serve kiosks that let customers complete their transaction without the help of a cashier.

Customers use the bilingual, talking, touch-screen kiosks to place their order, pay and receive change. "We launched the test because many consumers have come to expect a self-service option when they shop—[for example, at] movie theaters and grocery stores," says company spokeswoman Kathleen Anthony.

In addition to letting customers control the tempo of their ordering process, the kiosks help give employees more time to speed along orders and serve seated guests, Anthony says.