« February 2007 Table of Contents 
Trend Watch: New devices speed service
Restaurateurs enjoy efficiency, customers like pay-at-table security
By Lauren Kramer
February 01, 2007
One of the most common disgruntlements of American diners is
the process of paying the bill. It can take a long time for
wait staff to deliver the tab, pick up the credit card and
return it to the customer after the payment transaction has
been processed. In the meantime, the patron is held captive at
the table, and when a restaurant is humming, that wait can feel
endless.
There are other gripes to relinquishing credit cards in
restaurants. The restaurant industry is the only venue where
customers must turn their cards over to a complete stranger who
leaves their sight in order to pay the bill. And any time you
do that, the opportunity for fraud arises. Identity theft due
to credit-card skimming exceeded $1 billion in 2002, according
to Michael Friedman, director of emerging technologies at the
Mercator Advisory Group in Waltham, Mass., and 70 percent of it
occurred in restaurant settings.
In Europe, the industry tackled this problem some time ago
with the introduction of wireless, handheld, pay-at-table
terminals that allow patrons to swipe their cards and complete
payment with independence and speed. Only in the last six
months has this technology been tested in the American market,
with pleasing results to date.
Fatz Café in Winder, Ga., has been testing eight VeriFone
Vx670 wireless handheld credit-card terminals in its
restaurant. "We call it the On The Spot Payment Solution, and
we designed it specifically for restaurants," says Rob Regan,
VeriFone's VP of hospitality systems. "It's spill resistant,
smaller than other devices of its kind and extremely simple to
use for servers and guests. Also, it can accept debit cards and
credit cards."
Steve Corson, VP of human resources and training for parent
company Fatz Café Enterprises, says the testing has gone well.
"Our customers seem to be catching on to it and taking to the
wireless terminals the longer they are in use," he says. "Our
servers are also happy, because they've seen an increase in
their tips since the introduction of these terminals."
The Vx670 features a built-in calculator that prompts
restaurant patrons to choose a 10, 15 or 20 percent tip, or an
amount of their choice. Choose one of the first two options and
you don't have to calculate the tip yourself. Winder servers
are averaging tips of 15 to 20 percent after the introduction
of the wireless terminals, which is more than what they were
tipped before the system was installed, says Corson.
Wireless credit-card payments initially caused a stir at the
Fatz Café in Winder, particularly after they were featured in a
local television commercial, says Conrad Skelton, the
restaurant's manager. "People were coming in specifically to
use it, they were so excited about not having to give up their
credit cards," he says.
"It definitely speeds up service, because you just drop it
off at the diners' table and briefly explain how it works. The
simplicity and durability of the machine is what makes it so
good," says Skelton.
Speed of service has been a pivotal issue at Legal Sea
Foods, where over the past six months the Ingenico i7780
pay-at-table handhelds are being tested at three restaurants:
the Legal Test Kitchen and Long Wharf locations in Boston, and
the Framingham, Mass., restaurant.
"It's a big change for both guests and employees, so we've
been going slow in terms of adapting our software and listening
to guest feedback, but we've had 95 percent positive acceptance
of the wireless payment terminals," says Ken Chaisson, VP of
information technology for the 33-unit restaurant chain.
"Many of our restaurants operate on waits of anywhere from
45 minutes to two-and-a-half hours," he continues. "We were
really focused on looking for ways to increase our table turns,
and this shaves off minutes, which counts significantly."
Legal Sea Foods used Bluetooth wireless technology between
May and September 2006, but switched to an 802.11 wireless
network after that, which allowed for a wider usage range
within the restaurant. In the next year or so, the chain will
be adopting a new POS system by SIVA, which wrote the software
for the pay-at-table solutions.
Hypercom is another company with a cutting-edge mobile
wireless payment terminal. Its version, called the M4100 Blade,
weighs 7 ounces, is battery operated and features rubber
encasings around the magnetic stripe reader, making it spill
and grease resistant. It has an optional clip-on printer, an
illuminated, color-coded keypad and uses Wi-Fi or GPRS
communications options.
"Both will give you a range of 100 meters to a base
station," says Ed Mastrangelo, Hypercom's director of wireless
products.
Right now, the Blade is available in limited quantities for
beta testing and piloting, with full production scheduled for
this month.
"It's competitively priced, that's all we can say," says
Mastrangelo. Regan estimated the price for a VeriFone Vx670
would be less than $1,000 per terminal. The number of terminals
required by a restaurant would depend on its individual needs,
but the CTS Group, which analyzes the software, hardware and
communications technology necessary to
bring pay-at-the-table
to restaurants, estimates the average cost will be between
$12,000 and $15,000 per location.
Is it worth the capital investment? Definitely, says
Friedman of the Mercator Advisory Group.
For one, pay-at-table wireless terminals can save
restaurants money through their acceptance of PIN debit usage,
which can be less expensive for a restaurant than credit-card
payments. "Consumers are demonstrating a measurable preference
for PIN debit transactions, driven by their added security and
the fact that these transactions are self-serviced," Friedman
says, noting that between 1999 and 2005, PIN debit usage
increased from 11 to 19 percent.
"This is a very powerful tool for preventing fraud in
restaurants, and simultaneously providing a high level of
service to your customers," Friedman says. "Also, I think these
wireless payment terminals can be a distinguishing feature and
image enhancer for a restaurant, translating into a real
competitive advantage."
Contributing Editor Lauren Kra m er lives in British
Columbia