Two dollars. Most often, two dollars is not going to make the difference between “winning” and “losing” in business…but it sure can be! $2 can be the difference between making a profit and a loss on a specific transaction… and on a specific customer interaction. Two dollars can also be the difference between retaining a customer and losing a customer for good. In that instance, that two dollars is really worth a whole lot more than just two simple one-dollar bills. In fact, that two dollars can end-up costing the organization a far more than just two bucks, perhaps hundreds, thousands, or even more! If you lose a customer, and his/her/their business and thus, the future revenue stream you could have garnered from that individual/entity, you can cost your enterprise a whole lot more - many, many multiples of two dollars!
And so this is a tale about yes, two dollars! It is the story of how a local restaurant may have lost me as a customer forever over a two-buck charge. But this is not a rant, a screed, or an old man yelling at the clouds metaphorically in print. Rather, this is a cautionary allegory, one that can hopefully save you and your business customers, both now and in the future. This can be done by following one simple rule: Do not piss off the customers!
The Two Buck Pizza Box
As a seasoned strategic management professor and consultant, I can think of no better example anywhere in the world where a business was “penny wise, but pound foolish” than that of a local pizzeria in my town. In fact, this pizza joint is so close physically to me that it’s literally in my zip code! Still, for me, their $2 charge on each and every pizza ordered take out and/or delivery from them constitutes a bridge - and a really petty charge - too far! It is a deal breaker for me (and likely for countless other customers), whether their owner/management realizes it or not! It is two dollars in immediate revenue to the pizzeria, but that $2 likely costs their business far, far more than that in revenue down the road, and likely, even costs them some - to numerous - customers in the process.
Now, I must admit that being both a professor AND a man “of a certain age,” a two-dollar charge is not going to send me into bankruptcy, thank you! However, the fact that this local pizza establishment charges $2 for each takeout box really rankles me. Heck, I’m writing a whole article based on it!
This has been a long-standing issue with this local restaurant. Not that this has kept me from doing business with them (hey, they have very good, very unique pizza!), but their “pizza box charge” is, no doubt, an irritant both for myself and countless other customers, who may - or may not - still be their customers.
The charge first rankled me when they tacked on a fifty-cent charge per pizza box to their pizza orders years ago. Then, a few years back, the charge doubled to a buck each! Now, the last time I ordered from this local Italian restaurant - trying to do my part in supporting my local small business community and not ordering from the Domino’s/Pizza Hut/Little Caesar’s/Papa John’s (sorry Shaq!) “pizza oligopoly,” I found out at pickup time that their pizza box charge had now doubled again to two dollars - per box! So yes, I had in fact ordered 3 pizzas for a family gathering, so that meant that I spent $6 more on yes, pizza boxes!
Does Domino’s charge for their pizza boxes? Does Pizza Hut charge for its takeout boxes? Does Little Caesar’s do it? Heck, does Shaq charge for a big box to hold his “Shaq-a-roni Pizza?” And finally, does ANY other pizza place on the planet charge this?
I think not, and so while we had very, very good homemade pizza once again from them, I was left with a bitter taste in my mouth - and a slightly lighter wallet than I would have anticipated!
However, I am the type of management consultant who will, on occasion, try and make lemonade out of a lemon from just such a personal experience. And just so the reader knows, griping is not my go-to move! However, the “personal gripe article” is a rare tool that I take out of my consulting, teaching, and writing toolboxes at times, simply in order to make an important point. Again, when you get to be “of a certain age,“ you do not want to become the “angry old management consultant.” But, here goes!
The First Rule of Business
What I can say is that there should be a universal management rule. Put up in calligraphy, and in big bold letters, of every service business - really, any business! Every retail and restaurant operation should certainly have a sign with this rule in the board room and in every break room that employees at all levels see daily. And it should read simply: The first rule of this business is - do not piss off the customers!
A number of years ago, the head of SAS (the Scandinavian Airlines System), Jan Carlzon, wrote a great management book simply titled Moments of Truth. In this book, Carlzon laid out his management philosophy, which was astonishingly simple. He simply asked all of his employees at the airline who interacted with customers to realize that each and every customer contact, whether in person or on the phone (or today, that would be on the web and on social media as well), one must realize that your simple encounter with that customer – or potential customer - is indeed a “moment of truth” for your company or organization. Therefore, management and its employees - all of them - must anticipate, be prepared for, and execute well in these moments of truth to achieve superior customer service, customer satisfaction, and customer retention.
Not pissing-off the customer is certainly a simply stated rule. But it is one that, as anyone who has ever worked in a service business knows, a rule that is not always easy to follow. If management themselves can have this rule in mind with every decision that they make that impacts customers and how their employees should interact with customers, and if they take steps to ensure that the organization’s rules - and guidelines - and policies -and procedures - and just cultural norms in the organization, all work in favor of the customer’s perspective, this will go a very, very long way to ensuring excellent customer service on a consistent basis. This holds equally true whether you are the owner of a small local retailer or restaurant or you manage a service organization that spans two, tens, hundreds, or even thousands of outposts.
So where does the two dollar pizza box from my local pizzeria fit into this equation? Obviously, the owner/manager of this local restaurant, while well-intentioned, at least in terms of the bottom line, was not thinking as much about the top and bottom line for the company’s dealings with each and every customer. Sure, if you can recoup some of your costs by charging two dollars for a pizza box, likely well beyond the cost of the box itself, then by tacking on this charge, you can enhance your revenue, and hopefully, your overall profitability. However, for every customer that gets pissed off about the two dollar pizza box charge, especially when it multiplies by the number of pizzas he or she ordered, then you are at extreme risk not just losing that customer, but as happens in 2023, 20,24, 2025, and beyond, you really risk having him or her tell both friends in person and the wider world on social media about the fact that your pizza joint seems to be the only one on the planet the charges for a pizza box, let alone two dollars for each!
Think about the many moments of truth that are involved in a food service situation. When a customer and his or her family/guest dine at the restaurant, and have hopefully had a great, pleasant, tasteful meal with attentive and good waitservice, the last “step” is when they get the check (hopefully, without having to ask for it!). At this last touch point in the whole restaurant experience for the customer, basically at the end of the whole customer encounter. the pizzeria risks that the customer will not find the two dollar or four dollar or six dollar rate dollar charge for takeout containers to be tasteful or proper. So, with basically 90 to 95% of the customer’s entire dining experience completed at the restaurant, the restaurant risk losing much, if not all, of the customer’s satisfaction with their visit and their dining experience at the pizzeria.
Obviously, the same principle applies to takeout and delivery orders, a staple of any pizzeria. What happens when the customer actually sees the itemized bill, either at the time that they order, when they pick up their order in the restaurant, or when their order is delivered to them? What happens when they realize: “Holy smokes! They actually charged me for the box that his pizza came in (or this lasagna, or calzone, or pasta, or wings) was served in?” That’s going to be a tough - very tough - “customer service recovery” prospect at the end of all the moments of truth that went into that takeout or delivery order, no matter how good the pizza or the Italian dish might be.
What I will say, is that I did not test the policy. I did not object to the bill. I simply paid it. I do wonder, however, what would have happened had I, as a card-carrying AARP member, if when I went to pay the bill for the pizza at the bar, I had indeed said something to the effect of “y’all are really charging for pizza boxes really...really?”
So at the end of the day it really doesn’t matter if the pizza box is priced into the order or the check at $.50 two dollars or even $10! The reality is that no matter what the price, there will be customers who actually look at their itemized restaurant receipt, just to make sure that the bill is actually “right.” The question is then what percentage of that will find the charge in poor taste, like myself, and then what will they do? Will they just accept it - as I did until now, or will they object to it at the time with their server or the bartender as was my case (yes, I was just there at the bar to pick up the pizza!)? And whether they verbally object at the time and question the charge at the point of sale or not, they may just choose to passive-aggressively complain about the charge, both in real life to family and friends and in their social media lives (on Twitter (X), Facebook, Instagram, and more) or in reviews for Yelp, TripAdvisor and other restaurant review sites for the restaurant. The bottom-line is that if the person is really “torqued” about the $2 charge, not only does the restaurant risk losing him or her as a customer, but a whole lot of other current customers and potential new ones in the community. Such is managing in the 24/7/365 spotlight that is business today.
And does it matter in all of this that, to modify the famous Allen Iverson quote: “We’re talking about...pizza!”
Does it matter that the “box charge” is for pizza, rather than either fast food at the low end of the scale or five-star dining at the high end of the scale? From my perspective, going to the wisdom of Jan Carlzon, and countless other management and marketing experts, both past and present, you really shouldn’t test the don’t piss off your customer rule! This should be looked upon as a hot stove - to stay away from! That two dollars is simply not worth it, especially when you look beyond the value of one customer interaction and one transaction, and look at each customer as a potential lifetime of transactions and interactions, spending money with you, rather than elsewhere, and in the process, helping you to build your business, your brand, your reputation, and yes, potentially, your wealth. Any other way of looking at that two dollar pizza box is, and I don’t like to typically use these not-so-academic words, just damn wrong!
All too often, management looks at - and focuses upon - how “we” (the enterprise) can get one dollar more (maybe more) out of a single transaction, rather than building the customer relationship, so that the customer will want to willingly come back again and again and again and again to our business, over the choice of often many others, and spend money with us. This is the recipe for success – both in restaurants and indeed, far, far beyond.
And so, I hope that you take away a valuable lesson from my two dollar pizza box! I know that I think that my buying six dollars worth of pizza boxes will help businesses of all sizes, their managers, and their employees to learn, just how important each and every “moment of truth“ is in the life of any enterprise, and, as a consequence, the long-term success of it, and your career! Please share this article widely, as I think this allegory has relevance far beyond my local town, my local pizzeria, and yes, that two dollar pizza box!
About David Wyld
David C. Wyld is a Professor of Strategic Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, publisher, executive educator, and experienced expert witness. You can view all of his work at https://authory.com/DavidWyld. You can subscribe to his Medium article feed at: https://davidwyld.medium.com/subscribe.
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