How to Manage Chargeback Risks in Special Orders and Menu Items

Chargebacks are becoming an unfortunate reality for both big and small businesses. When a chargeback occurs, money gets tied up while bank or credit card issuers perform an investigation. Ultimately, you may have no choice but to refund the original transaction amount, resulting in major revenue losses.

The chargeback process can occur for any retailer selling physical products or digital goods, including restaurants. While many customers may have legitimate reasons to raise payment disputes due to fraudulent transactions, many will use the chargeback process to get refunds because of poor customer service, lackluster food quality or incorrect orders.

There are a variety of reasons why chargebacks occur, and you can learn more through bank reason codes. But one of the most common reasons customers request a chargeback is issues with special orders or modifications to menu items.

Understanding the Chargeback Landscape for Special Orders

You've likely put tons of thought into your menu as a restaurant owner. You've spent time crafting a great menu that people will love. But as you review your finances and start sifting through chargeback reason codes, you might realize that most come from specific menu items and special orders.

Not everyone will order standard menu items. Many of your customer base may make adjustments or request special orders, creating more room for errors that result in unhappy customers.

What Constitutes a Special Order?

A special order is any order from a customer that's different from what's on your menu. For example, some customers may request modifications in ingredients or how your kitchen staff prepares the food. Those requests can be as simple as leaving out a standard ingredient or as complicated as preparing the food in a completely different way than what your cooks are used to.

Some customers will take things and even order with special requests, asking your cooks to prepare a dish that's not on the menu using ingredients you already have. Whether or not you accept those orders is up to you. Most establishments in the restaurant industry provide menu flexibility to cater to as many diners as possible.

But even with clear return policies and a strict refund policy, special orders often result in payment disputes with a credit card company if your team doesn't do things exactly right.

What Unique Challenges Do They Pose?

Special orders are challenging for many reasons.

First, they require your team to go beyond their training and know-how. Your kitchen staff learns how to prepare menu items to perfection. Ask them to do something outside your set menu, and they may struggle to get things right.

Another major challenge is determining what customers truly want. Communication can be a significant hurdle. Not every patron is fluent in “kitchen speak!” Therefore, miscommunication and confusion can cause your team to prepare something your customer didn't want.

These challenges are some of the most common reasons why chargebacks occur with special orders. The customer may feel they didn't get what they paid for, resulting in a dispute.

Recognizing Patterns and Areas of Vulnerability in the Ordering Process

It's important to monitor where those challenges lie and why chargeback processes occur. Pay attention to the ordering process; you may discover patterns with specific items.

For example, multi-item dishes with several options may present clear issues to customers. The menu may be too confusing for the average diner to interpret, resulting in miscommunication and errors during order prep.

Those vulnerabilities during the order process are fixable. However, failing to address them will only result in continued problems and a much higher chargeback rate.

Quality Control Measures for Chargeback-Prone Menu Items

It doesn't matter whether your chargebacks are from a set menu item or frequent special orders. Quality control is paramount! Maintaining high standards for every dish that leaves your kitchen is crucial, but chargeback-prone items and special orders require more attention.

Here are a few measures you can take to alleviate ordering issues.

Implementing Rigorous Order Accuracy Checks

Stringent accuracy checks are a must. Whenever an order comes through, you should have a team member review it before sending it to the kitchen for preparation. Then, once it comes out, they should triple-check that it matches what the customer wanted.

Go the extra mile and adopt best practices for order accuracy. Spend extra time on delivery orders and requests sent through an app. Because those orders came from an outside source and didn't involve direct human-to-human contact, there's more room for error.

Drill the importance of order accuracy into your team and consider adopting technology that can act as a second pair of eyes to spot potential errors. The goal is to catch problems before they cause customer disputes and chargebacks.

Communication Protocols with Customers

Communication can make all the difference. That's even more true with complex menu items and special orders.

If there's any modicum of confusion when an order comes in, reach out to customers for clarification. It's better to communicate than second-guess and ignore your chargeback prevention strategies.

Enhancing communication protocols is always a good idea. Adopt new practices and technologies that make it easier to contact your customers when issues occur. You can use an app notification system, text messages, calls, emails, etc.

Don't limit that communication to order confusion. You can also employ protocols to get clarification on delivery options, contact information, addresses and more. Using things like order confirmation and address verification systems creates more open lines of communication and provides peace of mind all around.

Menu Item Customization and Chargeback Prevention

When you realize that you're getting frequent chargebacks due to specific menu items, you must take steps to prevent challenges for customers and your team. Ignoring the problem won't make it go away! Chargeback-prone items and special orders can cost your business more than you might realize, so you must take action and develop chargeback prevention strategies that focus on your menu.

Building a Transparent Menu

The best thing you can do is to build a transparent menu. That means providing detailed descriptions about every item and providing customization options. Simple menus with policy information or options can give diners the impression that they can make as many customizations as they want.

You might not have a problem providing that wiggle room for customization, but you should be transparent about what your team can and can't do. Furthermore, it's a good idea to include information about additional costs, limitations and other restrictions.

Having a transparent menu sets your restaurant up for success from the jump. It makes things easier for your customers and can leave little room for error.

Training Staff for Customization Protocols

Another tip to help prevent menu-related chargebacks is to train your team on what they should do when modification requests and special orders come in. Many teams have no problem working at lightning pace, preparing set menu items to perfection. But something outside the norm can throw them off, resulting in mistakes and huge delays that ripple through your entire restaurant operation.

Have clear protocols in place and train your team on what they need to do. For example, you can teach wait staff and floor members who take orders to get additional clarification. You can also teach them what your cooks can and can't do, allowing them to communicate with customers about their options.

In the kitchen, you can develop protocols on how your staff approaches special orders. Have them double-check accuracy, get clarification when necessary, etc.

Additional training and well-established protocols go a long way. They help keep things running smoothly and minimize costly mistakes.

Customer Education and Feedback Loops

It's not just your staff that could use a little training! Customers can use education, too. Ordering food can be an overwhelming experience, especially if they're unfamiliar with your menu items and options.

A transparent menu makes a huge difference, but you can also educate customers through staff interactions and in-app experiences. It doesn't matter whether your patrons place orders online or in person. Try to provide them with as much information as possible and present options to avoid communication errors.

As a restaurant owner, you should also collect feedback. Genuine thoughts and opinions about your menu and the overall ordering process can help you improve. Send surveys to see what people think of chargeback-prone menu items.

Gather insights and find opportunities to make changes. Then, do it all over again to establish a never-ending feedback loop. Customer feedback can help you identify core issues with your menu, empowering you to alleviate miscommunication issues that result in frequent chargebacks.

Your restaurant always has room for improvement, so gather as much feedback as possible to continue evolving.

Get Started With Superorder Today

Transaction disputes can be a nightmare. Refunds, additional fees from issuing banks and hidden expenses that arise from a chargeback dispute can cost your business big bucks. When those chargebacks are a result of confusing menu items and special orders, you should take action to stop them.

Fortunately, there are many effective strategies to lower your risk of chargebacks. The right approach, successful preparation protocols and a well-designed menu can safeguard your business, boost your bottom line and allow you to create better customer experiences.

Let Superorder guide you in the right direction. Superorder is an all-in-one restaurant management app with features that help you reduce chargebacks. Create the perfect menu, improve operational efficiency, manage disputes as they come and more, all from one place.

See how Superorder can pave the way to more growth and success for your restaurant today!