On Thursday, September 7, the point-of-sale system Square had a widespread outage, impacting thousands of businesses across Portland. Scores of restaurant and food cart owners took to Instagram to alert customers that their businesses were going to be cash-only for the night. Others attempted to process payment using Square’s “offline mode,” later discovering that thousands of dollars in sales were missing. A week later, Portland restaurant owners and chefs are still reeling from the outage, and grappling with what the fragility of Square’s point-of-sale system could mean for their businesses in the event of future outages.
Functionality was restored Friday morning, and in a statement issued this week, Square outlined what went wrong and how it plans to subvert future disruptions in the event of a similar outage. The company explained that the outage was caused by an internal issue with their domain name system (DNS); while changes were being made to network software, the “updates prevented systems from properly communicating with each other.” However, restaurant owners are left with a bitter taste in their mouths — and a loss of revenue that could continue to cause issues for months to come.
In the wake of the outage, Friendship Kitchen owner Trang Nguyen — who also helps run wife Wei-En Tan’s businesses, Stem Wine Bar and bistro Alouette — posted on Instagram, saying the businesses lost three-fourths of all their Thursday transactions. “I’m not kidding when I say at this point I’m selling my soul to pay for bills,” she writes. “Pardon my language but we are fucking devastated.”
Scottie’s Pizza Parlor owner Scott Rivera estimates his businesses lost nearly $2,000 in sales on Thursday, either from customers giving up on online orders that wouldn’t go through or folks switching plans when they weren’t able to use alternative payment (Scottie’s opted to accept cash or Venmo). Rivera came away from the experience feeling like businesses that use payment processing companies such as Square are completely powerless.
“When their systems inevitably fail, there is no regulation, insurance policy, or legal requirement for them to take any accountability for the thousands of dollars that each and every business can lose from just one incident,” Rivera says. “Even small business insurance doesn’t reimburse ‘loss of business income’ unless it’s for a sustained period of more than three days.”
In the past, Square’s system has experienced outages — however, those were typically for short periods of time and users were still able to process sales in “offline mode.” In this case, business owners were in the dark as to whether they had just lost the day’s earnings, which can significantly impact restaurants that are already skating on paper-thin margins.
For Kim Jong Grillin owner Han Ly Hwang, not knowing if his sales were lost created a level of anxiety that went beyond the potential dip in revenue. In a stream-of-consciousness Instagram post, Hwang detailed the thoughts that ran through his head as he waited to see if the payments would go through. “I think to myself, ‘Can’t let the world know that I’m about to bounce every planned Thursday and possibly Friday payment,’” writes Hwang. “We all woke up at 3 a.m. to check and see if [the deposit] went through. We all know that we can’t go another day being in the red. I slowly think to myself, ‘Shit... is this the way I go out?’”
Rivera believes that Square should make an effort to reimburse businesses that rely on the service. He has previously tried to take Square to task, contacting the company to ask for a credit on his account in acknowledgment of their system issues causing a loss of business. The most the company has offered was to waive its three to four percent processing fee on $1,000 worth of sales.
A spokesperson from Square declined to comment for this story, but directed Eater to the aforementioned statement, indicating that the company is making adjustments to its systems and communication procedures to better react during outages. Some of those changes include adjustments to the firewall, stronger offline payment capabilities, and faster and more robust communication of outages via email and automated phone messages. It did not indicate that Square customers would be reimbursed.