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'Covid fees' a short-term fix that could alienate customers

Ada Slivinski: Charging extra – or asking for discounts – to make up for lost revenue may be attractive, but there’s a fine balance to strike between short- and long-term results.
The new measures aren't free, but equally, customers don't have more spare cash.

With non-essential businesses starting to open up in Phase 2 of B.C.'s Restart Plan, some are charging a “covid-fee,” or asking for “Covid-friendly pricing” from contractors.

Zazou Salon in North Vancouver is adding a $7.55 Covid-fee to every service. “This is to help us provide all the necessary PPE and disinfectant product required to keep you safe and allow for the additional time needed to sanitize thoroughly between each and every guest as we function in a restricted scheduling world,” reads the new disclaimer on the salon’s website.

They are certainly not the only ones. Some nail salons and restaurants are also passing part of the additional cost onto customers. On one hand it makes sense; businesses who lost nearly two months of income are scrambling to keep their doors open – while simultaneously trying to deal with the added costs that come with increasing sanitation, reducing capacity, and installing measures like plexiglass dividers. But for their customers, many of whom have seen their own income decrease – in many cases to zero – it’s a tough pill to swallow.

Many customers do want to help. Some etiquette experts are now saying “25-30 per cent is the new 15 - 20 per cent.” That’s a nice idea for those who can afford it. But for many, a regular 30 per cent tip will be the difference between springing for takeout or hitting the grocery store; visiting the barber or pulling out the scissors at home. Decisions like those will hit business’ bottom line more than anything else. At least tip percentage is optional, but a flat Covid-fee is potentially more alienating to customers.

We’re also seeing some businesses asking prospective contractors for a break on rates as a result of Covid. A marketing industry Facebook group I’m part of includes a post asking for photographer recommendations with the stipulation “Covid-friendly pricing appreciated” caught my eye.

Photography was one of the industries hardest hit by the quarantine. With events and in-person shoots pushed back or cancelled, many professional photographers went months with very little income. To ask them for work below usual cost smacks of opportunism.

Courtesy and customer service are more important now than ever. If as a small business you have to raise your prices to cover increasing costs, try to play the long game. A small additional service fee might help in the short term, but what if it means that same customer can’t afford to come back?

The economy and especially the service industry has changed dramatically over the past few months. But what people will remember most about doing business with you is how they felt.

In the words of Dr. Bonnie Henry, it’s a time to “be calm, be kind and be safe.” And when it comes to business, play the long game.

Ada Slivinski is the Founder & Principal of Jam PR, a boutique agency focused on helping small businesses get big exposure. You can reach her at [email protected]