Mom-and-pop restaurant revolt forces Big Tech vendor Toast to rescind its surprise fees on American diners
Toast CEO wrote in an email to its clients that the company had 'the best of intentions'
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FIRST ON FOX: Raise a toast to the little guy. At least for now.
America’s beleaguered mom-and-pop eateries scored a victory on Wednesday when Big Tech point-of-sale vendor Toast Inc. rescinded its surprise fees on diners that it added remotely to customer receipts without the consent of its client restaurants.
The fees were lifted out of client bank accounts by Toast and placed in its own coffers, according to business owners.
The scandal ignited nationwide outrage in the restaurant industry, inspired a congressional inquiry and fueled threats of class-action lawsuits.
SUDDEN NEW FEES CHARGED TO MILLIONS OF AMERICANS BY BIG TECH VENDOR TOAST SPARK CONGRESSIONAL QUERY
Toast abused its cloud-based high-tech capabilities in what amounted to a "hijacking" and a "hostile takeover" of thousands of restaurants’ point-of-sale systems, operators told FOX Business.
"While we had the best of intentions — to keep costs low for our customers — that is not how the change was perceived by some of you," Toast CEO Chris Comparato wrote in part in an email to thousands of its clients nationwide, copies of which were forwarded to FOX Business.
Matt Wilhelmson (back, left), owner of Koehn Bakery in Butler, Missouri, met with Rep. Mark Alford (R-Missouri) on Monday to discuss the new fees being charged to his clients without his consent by point-of-sale vendor Toast Inc. (Courtesy Office of Rep. Mark Alford / Fox News)
"We made the wrong decision and following a careful review, including the additional feedback we received, the fee will be removed from our Toast digital ordering channels," the email also said.
The email's subject read as follows: "Removing the Order Processing Fee - A message from our CEO."
FOX Business made several outreaches to Toast for comment about the company's removal of the fees. A response was not received by time of publication.
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Last Tuesday, FOX Business reported on the fee scandal the day after Toast rolled out the controversial new fee program nationally — sparking a congressional inquiry within 48 hours.
"We made the wrong decision and following a careful review, including the additional feedback we received, the fee will be removed from our Toast digital ordering channels." — Toast CEO Chris Comparato in an email to clients on Wednesday
"Today’s decision from Toast is a huge win for businesses and individuals all across America," Rep. Mark Alford, R-Missouri, told FOX Business on Wednesday.
"The removal of this fee sends a signal about how public pressure can make a real difference."
In this photo illustration from 2021, a Toast Inc. logo is seen on a smartphone and a PC screen. (Pavlo Gonchar/SOPA Images/LightRocket via Getty Images / Getty Images)
The mea culpa, however, from the once-trendy 12-year-old Boston-based point-of-sale and credit-card processing provider appears to have done little to smooth over the incredible trail of distrust Toast created among its 85,000 restaurant clients
"I feel like [Toast] showed us that we can’t trust them to be a business partner," Matt Wilhelmson, who owns Koehn Bakery in Butler, Missouri, told FOX Business.
"I don’t feel like in any way, shape or form that this response puts any more trust from me in them."
Wilhelmson pointed out "that they’re not returning anybody's money."
Toast
.Anger at Toast started percolating in February.
The company, after announcing a new partnership with Google, began to leverage its access to the point-of-sale systems of thousands of client restaurants around the nation to charge diners 99 cents for online orders of $10 or more.
Elizabeth Van Wie, right, whose family owns Zookz Sandwiches in Phoenix, Arizona, was among thousands of restaurateurs nationwide who revolted against Big Tech vendor Toast. "We’re frustrated. We feel stabbed in the back. Toast still leaves a very ba (Courtesy Zookz Sandwiches / Fox News)
The charges were remotely added to receipts by Toast without the consent of restaurateurs — yet they appeared as if they were line-item restaurant charges.
"Toast did us dirty," fumed one Toast customer on the company's own client forum.
"We’re frustrated. We feel stabbed in the back." Elizabeth Van Wie, restaurateur
The charges on American diners came on top of the monthly fees and credit-card processing fees client that restaurants pay Toast for its services — up to several thousand dollars per month, according to operators.
A July 6 receipt from Mickey's N.Y. Pizza of New Hampshire shows an "Order Processing Fee" of 99 cents added to the bill. The charge was made remotely by point-of-sale vendor Toast Inc., said shop owner Tony Naser, and without his consent. Those fees (Courtesy Tony Naser / Fox News)
"I’m happy they’re finally doing the right thing," restaurateur Elizabeth Van Wie, whose family owns Zookz Sandwiches in Phoenix, Arizona, told FOX Business.
"But we’re still exploring our options," she said, meaning for other vendors. "We’re frustrated. We feel stabbed in the back. Toast still leaves a very bad taste in my mouth."
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Consumers who were sick of ever-mounting fees on traditional services responded angrily to the charges, naturally assuming restaurants were padding the tab.
Eric Stockmann, owner of Giuseppe's Lunch and Catering in Fenton, Missouri, said he lost 70% of his online business since Big Tech point-of-sale vendor Toast Inc. began hitting his customers with new fees without his consent or control. (Courtesy Eric Stockmann / Fox News)
"We had no control over it," one Texas restaurateur told FOX Business.
Adding insult to injury: Diners had to pay meal taxes on added Toast fees while restaurants had to report the money that was taken by Toast as their own taxable income.
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"I think we rattled their cages," Tony Naser, who owns pizza shops in Massachusetts and New Hampshire, said of the nationwide revolt against Toast.
"I think we rattled their cages." — Tony Naser, pizza shop owner
But he, too, is still left seething that the company even instituted charges on his customers without his consent in the first place.
Restaurateurs such as Tony Naser, left, became outraged by new fees imposed remotely on diners by Toast Inc. Rep. Mark Alford, R-Missouri, earlier told FOX Business, "This is a story that impacts every American." (Kerry J. Byrne/Fox News Digital and Office of Rep. Mark Alford / Fox News)
"How can you trust them to make good ethical business decisions?" said Naser.
"This is f----- up how they ever made this decision in the first place," he also said.
A nationwide revolt by mom & pop restaurateurs, including Matt and Kim Wilhelmson of Missouri (left) and Elizabeth Van Wie of Arizona (right) pushed Big Tech vendor Toast Inc. to rescind its new fees that caused outrage among many of its clients. (Courtesy Koehn Bakery & Zookz Sandwiches / Fox News)
"What businessman decides to charge customers who are not their own?"
Naser said he is also looking at other vendors as options for his business.
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The email from Toast from its CEO to clients finished with, "I’d like to close by thanking you for your input and support of Toast. We can accomplish far more together than we can apart and we remain committed to supporting your restaurant and the industry well into the future."