<p>“But we are talking about SMALL businesses and family owned restaurants. Sort of like patronizing the local bookstore, rather than Borders and Barnes & Noble. Don’t complain when the only restaurants in your town are a franchise or part of a chain.”</p>
<p>I’m not worried that that’s going to happen in downtown Chicago. Almost all of the restaurants on opentable are locally owned, unique places. It’s just absurd to suggest that eating at a local restaurant booked via opentable is equivalent to eating at Applebee’s. I’m giving my restaurant dollar to the local restaurant, and they are paying a marketing fee that they apparently think is worth it.</p>
<p>I assume that when you patronize local restaurants and stores, you always pay cash in order to avoid imposing credit card fees on that small business, right?</p>
<p>Well, you’ve got me there. Before there was opentable, the restaurant industry was an oasis of calm and stability in the business world, and local restaurants never went under. After all, that’s the only way you would know that the restaurants discussed on that 2008 thread owe their deaths in part to opentable. Right?</p>
<p>Also, all those local restaurants that closed were replaced by Red Lobsters, not by new local small businesses. Right?</p>
<p>I see you didn’t answer my question about always using cash. That is what you do, right? Because it would be really hypocritical to impugn other people for imposing fees on small businesses for the sake of the customer’s convenience when you do the same thing, right?</p>
<p>One of our favorite locally-owned restaurants just closed. We have several others we really like, and I would like to take steps to help them stay in business, within reason. Obviously, eating there more often is the best way–but it seems as though using OpenTable might reduce the benefit of our frequent patronage. I guess paying cash would also help a bit–but how much does using a credit card cost the restaurant vs. using OpenTable?</p>
<p>It’s really not the customers responsibility to worry about the profits of a company or to feel that if the use the business in a less profitable manner that the business will close.</p>
<p>OpenTable is marketing and is no different than companies that pay for billboard ads or radio ads or internet banner ads. It’s also similar to department stores that run sales on merchandise. It’s not unethical to buy merchandise when it’s on sale, even if the store is selling the merchandise for less than their cost.</p>
<p>Bobby’s Crab Cakes is no longer in business because they weren’t able to offer a product that customers wanted at a price that allowed them to make enough profits for them to stay in business. Either they were wanting more money for their meals than their customers were willing to pay or their cost structure was too high. </p>
<p>They could have reduced their cost structure by not using OpenTable. They would have had to use other marketing or word of mouth to fill their tables instead. They elected for lower profits using OpenTable in exchange for filling more seats. This decision turned out to not be the wise one for the restaurant.</p>
<p>It no case it was the customers fault for choosing how they made their reservation, what meal options they chose, or how long they spent at the restaurant. It’s the restaurants decision on which options to give to the customer.</p>
<p>We could say it was your fault for not buying a large enough meal, for taking too long to eat (reducing the number of customers that can eat in a given night) or not buying enough drinks. But none of that is your worry as a customer.</p>
I understand all that, but I repeat that it was in my own personal best interests for Bobby’s to stay in business. Why would it be unreasonable for me–and others like me–to take steps to protect my own interests?</p>
<p>“how much does using a credit card cost the restaurant vs. using OpenTable?”</p>
<p>It’s generally a percentage of the transaction, rather than a flat fee like opentable. So the more you buy at the restaurant, the more they pay the credit card company.</p>
<p>If you want to keep a restaurant in business, the most important things to do are (1) bring your friends there and (2) order drinks. That’s where a restaurant with a liquor license gets most of its profit. I’m a rotten customer and usually don’t even order a Coke with my meal due to the high markup on beverages.</p>
<p>“Why would it be unreasonable for me–and others like me–to take steps to protect my own interests?”</p>
<p>It’s not unreasonable, but it suggests that Bobby has set his crab cake prices too low to take advantage of your devotion. He should charge more if he is worth that much to his customers. Given his flawed pricing model, if you want to put extra money in his pocket, go ahead – I’m just saying the customer has no duty to do so. If I still made good money and if I still lived in Hyde Park, where the loss of a decent restaurant is a real blow to the neighborhood, I’d probably lean more in your direction and order more appetizers and drinks.</p>
<p>“I feel like I’m at a deposition!”</p>
<p>I feel like I was accused of putting local restaurants out of business in favor of chains. I feel that way because it’s actually what you did before you edited your post. I love that the thread you linked to bemoaned the loss of a Bennigan’s. I guess opentable isn’t to blame for the death of that local small business!</p>
<p>If I read shrinkrap’s link correctly, open table charges what amounts to a percent of a typical table of 4
Usually these fees are simply passed along to the customer in the form of slightly higher meal costs. So ultimately the customer pays, not the restaurant.</p>
<p>It this economy, we’ve seen many many restaurants, including ones that have been around for a long time, get creative with offers (think all the buy-one-get-one deals on coupon books, restaurant.com, groupon, fixed price meals,etc) become victims of the economy. Less people are dining out and they are trying to get the most for their money. Don’t really think open table is to blame. JMO</p>
<p>I’ll disagree on this one. Business can only charge for their products what a willing buyer wants to pay. In a highly competitive market like restuarants, you can’t pass along fees without losing customers. (You can in a non-competitive market like cable tv, cell phones, or the electric company).</p>
<p>But that’s beside the point. I think OpenTable feels the restaurant gets their money worth by having them book a table and eat at a time when the customer may not anyway. It helps spread the customers over a longer period of time in the evening which allows the restaurant to sell more meals in an evening. They may not make a lot of money by filling that table of 4 but it will help pay the overhead cost and is better than having that table of 4 sit empty during that time slot.</p>
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<p>I agree. Trying to blame an optional service like OpenTable for running a restaurant into the ground is passing the buck on who is responsible for the restaurants demise.</p>
<p>If opentable became the only option – like Ticketmaster, to which it has been compared – then that would be a completely different story. Typically, you can’t buy concert tickets from the venue or the artist, you HAVE to go through Ticketmaster and pay whatever exorbitant fees they charge. But opentable has never forbidden participating restaurants from taking reservations over the phone. If it started doing that, I’d have a problem with it.</p>
<p>No, I would be perfectly happy to pay a reasonable Ticketmaster “convenience fee” if buying the ticket through them really increased my convenience (the way opentable does). But I’m not allowed to go to the box office at the venue to buy it – Ticketmaster is the only option if I want to see the artist – so there is no convenience service provided. It’s just extortion.</p>
<p>It isn’t even the artist’s choice to have an exclusive deal with Ticketmaster. Virtually every venue is in a Ticketmaster stranglehold, leaving the artist with no alternative except playing on the street and passing a hat.</p>
<p>If and when opentable tries any of that BS, I’ll view them as the enemy, whether they get their fees from me or from the restaurants.</p>
<p>Ive never used opentable, but we rarely go to the area restaurants listed. As far as I can tell, they include ones that are expensive &/or overpriced.
But if opentable helps them fill their space- I don’t see why they should complain- if they were seats they couldn’t fill without it.</p>
<p>Most places we eat at, don’t take reservations.
( but that’s ok- I don’t know what movies I want to watch a week from now, let alone what I want to eat )</p>
<p>Of course, they do! And that does not stop people like Chris Cosentino to want us to believe “that a table of 4 spending $200 on dinner would generate a $10 profit.” </p>
<p>Does he really want us to believe that a table ordering the [Leg</a> of Beast Dining](<a href=“http://incanto.biz/2010/10/21/leg-of-beast-dinin/]Leg”>http://incanto.biz/2010/10/21/leg-of-beast-dinin/) would net him $15 to $25.00? And this at a cost of $49 per person, when such price excludes beverages, service & tax. Does anyone want to calculate how much it would cost to invite 6 to 8 people … with drinks, tips, and taxes? </p>
<p>The problem of most of those places is that they are so used to hose their customers that they have lost the merest grip on reality. They overspend on building restaurants, hope to keep huge profit margins on food, steal blindly on beverages, and pray nobody talks about poor service and mediocre experiences. Just as the waiters who expect tips of 20 to 30 percent, those people live in lala-land! </p>
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