Tuesday, March 13, 2012 - By Donna Goodison, A Boston restaurateur hopes to overturn Open-Table's stranglehold on the industry with the launch of a new online restaurant reservation system.
Aquitaine Group's Jeff Gates teamed up with engineer Van Garrett to start UReserv, designed as a cheaper alternative to OpenTable that gives restaurants more control over managing their reservations and customer data.
The cloud-based reservation system, operating in beta mode since May, already has 140-plus restaurants paying a $60 monthly fee to use the service from any web-enabled device.
"It was really borne more out of a survival instinct that we all have in the restaurant business,' said Gates, whose restaurants include Aquitaine, Gaslight and Union in the South End. 'We used OpenTable, and the growth of that bill just became excessive. We were up to $14,000 a month for six restaurants."
That included per-restaurant charges of $200 a month to lease a computer and software from Open-Table and a $1 fee for each seat booked through Open-Table's site. Gates watched as customers who went to his restaurants' websites for reservations were redirected to OpenTable, which then directly solicited them with its own email marketing.
TABLEMATES: Jeffrey Gates, left, and Van Garett, co-founders of UReserv, an affordable online reservation site for restaurant owners, are seen at their New England Food Show booth at the Boston Convention & Exposition Center yesterday.
San Francisco-based OpenTable declined comment, citing its unfamiliarity with UReserv, but said it's transparent about its fees. It has more than 25,000 restaurant customers, including 278 in Boston, and seats 9 million diners per month.
UReserv investor Steve DiFillippo, CEO of Davio's and Avila, likens the Open- Table backlash to his push 20 years ago to get American Express to reduce its transaction fees for restaurants. "It's nice that we're giving OpenTable a run for its money, because they've been overcharging us for years," he said. "They control the country."
But DiFillippo and Gates haven't cut ties with Open- Table. Gates' eateries are using UReserv for the 30 percent of reservations that come through their own websites and Facebook pages, saving each about $250 a month. But that information and phone reservations still are fed to OpenTable's system, which they continue to rely on for customers making reservations through that site.
The ultimate goal, though, is for UReserv to gain enough traction so customers can stop using Open- Table altogether.
"It's like coming off heroin," Gates said. "I'm sure most restaurants in the country envision dropping something that costs $2,000 a month to use."