Local restaurant owners say they're victims of internet coupon 'deal'

Local restaurant owners say they're victims of internet coupon 'deal'

HONOLULU (HawaiiNewsNow) -

Hawaii News Now spoke with Tania German, the Director of Marketing Communications for Restaurant.com Thursday morning.  She provides the following statement regarding Restaurant Epic and Himalayan Kitchen, which German says had agreed to work with Restaurant.com in the last week -- though both local owners say they did not authorize any discount coupons for their establishments.

"Both restaurants have been removed from our program and all customers that purchased a certificate will be offered an exchange or refund if that is what they prefer.  Since we spoke, our Partner Success team has spoken to Restaurant Epic and is still trying to connect with Himalayan Kitchen.

Regardless, all customers have been proactively followed up with regarding the certificate they purchased for these restaurants.

Regarding the Better Business Bureau report, we do maintain an A- status with the bureau and do take very seriously the inquiries and issues through that channel.  We serve millions of customers nationwide and are proud of our attention to resolution for situations through the BBB, customer service team, and our social media channels.  Our focus is the diner – that is who we serve every day in addition to helping restaurants fill tables."

German says Restaurant.com is a marketing program designed to "drive consumers to fill tables".  Establishments do not pay for the service and no money is exchanged between Restaurant.com and the businesses -- meaning Restaurant.com keeps 100% of the proceeds from the coupons they sell, if the businesses agree to accept the gift certificates.

German says restaurants who no longer want to participate in the program can cancel at any time. She says customers who've purchased coupons for restaurants that do not accept them are always offered a refund or exchange with a participating restaurant.

Original story:

Local restaurant owners are warning customers about a discount coupon being offered on the internet they're calling a scam.

Any one who buys it thinks they're spending $10 for $25 worth of food, but the local businesses say they never authorized such a promotion.

The company behind the coupons is Restaurant.com.  According to its website, there is no revenue-share agreement with the restaurants themselves -- meaning whatever they charge for the gift certificate, Restaurant.com keeps 100% of the proceeds.

Alan Chang is co-owner of Restaurant Epic in Chinatown.  He says he was shocked when two customers came in with coupons for more than 50% off.

"We honored today whatever showed up, but we realized there's so many out there -- there's no way we can do it.  I think it was posted yesterday and they sold 200 already," Chang explained.

Chang says he never heard of Restaurant.com before today and didn't approve any deals.

"We don't have any part of that.  They're doing what they're doing to make their money.  All we're doing is getting losses right here on this end," Chang said.

Chang now has notices up warning customers, but knows it's too late for those who've already bought the gift certificates.

"Right now if they do come in -- I hate to say it, but -- I'm sorry, I can't cover that. You would have to take it back to the person they bought it from whoever that was and deal with them," Chang said, adding his small business can't absorb such a big loss in revenue.

Chang says he's tried to get in touch with Restaurant.com all day, but no one has responded.  Suman Basnet, the chef and owner of Himalayan Kitchen in Kaimuki, says he's going through the same thing.

"I was stressed out because that's a lot of money that's going from our pockets to them and I'm trying to get hold of them," Basnet described.

Unlike Chang, Basnet says he spoke with someone from Restaurant.com a few days ago about the possibility of working together, but never authorized anything.

"I'm trying to figure it out.  I'm going to go home today and write them email again today regarding, 'Hey, what's going on? You need to stop it, take it down, take out everything and refund the money to the people that you've taken because we've never talked about anything promotional like selling coupons or vouchers or anything like that'," Basnet explained.

There are 14 other O'ahu establishments listed on Restaurant.com's page, and it's unclear how many of them may have knowingly entered an agreement with the company.

Hawaii News Now reached out to the Chicago-based business several times Wednesday but did not hear back.

According to the Better Business Bureau of Chicago and Northern Illinois, Restaurant.com is not accredited.  It shows they've received 450 complaints in the last three years.   A BBB statement on the review of the consumer complaints on their website "delineates a pattern of consumer allegations.  In the complaints, consumers allege that various restaurants featured on Restaurant.com will not honor coupons they had purchased from your company.  Additionally, consumers allege that the company has refused to provide refunds for coupons that were not honored by these restaurants.  Restaurant-owners have also alleged that the company's sales staff has misrepresented the frequency of discounts offered by Restaurant.com and that the company has sold coupons for higher amounts than they had agreed upon with the company's sales staff."

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