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Restaurants counter payroll tax hike with service boosts
By: Mark Brandau
Operators feel pressure to inspire loyalty as "fiscal cliff" payroll tax increase threatens consumer spending
Lost in the headlines that last week’s legislative resolution to the “fiscal cliff” would permanently freeze income tax rates for households earning less than $450,000 is the fact that a two-year-old payroll tax holiday expired, which operators worry could mean less spending at restaurants.
Yet while many restaurants roll out cyclical promotions related to value, operators said the response to the 2-percent increase in the payroll tax in 2013 should not be a price-focused marketing blitz but renewed efforts to inspire loyalty through customer service.
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