Restaurant bans tipping. Guess what happened?

[Fish]

After I banned tipping at my restaurant, the service got better and we made more money

Tipping, as a compensation scheme, is great for everyone.

Restaurant customers like tipping because it puts them in the driver’s seat. As a diner, you control your experience, using the power of your tip to make sure your server works hard for you.

Restaurant servers like tipping because it means their talent is rewarded. As a great server, you get paid more than your peers, because you are a better worker.

Restaurant owners like tipping because it means they don’t have to pay for managers to closely supervise their servers. With customers using tips to enforce good service, owners can be confident that servers will do their best work.

There’s only one problem: none of this is actually true. I know because I ran the experiment myself.

For over eight years, I was the owner and operator of San Diego’s farm-to-table restaurant The Linkery, until we closed it this summer to move to San Francisco. At first, we ran the Linkery like every other restaurant in America, letting tips provide compensation and motivation for our team. In our second year, however, we tired of the tip system, and we eliminated tipping from our restaurant. We instead applied a straight 18% service charge to all dining-in checks, and refused to accept any further payment. We became the first and, for years, the only table-service restaurant in America where you couldn’t pay more money than the amount we charged you.

You can guess what happened. Our service improved, our revenue went up, and both our business and our employees made more money. Here’s why:

• Researchers have found (pdf) that customers don’t actually vary their tips much according to service. Instead they tip mostly the same every time, according to their personal habits.
  
  
• Tipped servers, in turn, learn that service quality isn’t particularly important to their revenue. Instead they are rewarded for maximizing the number of guests they serve, even though that degrades service quality.
  
  
• Furthermore, servers in tipping environments learn to profile guests (pdf), and attend mainly to those who fit the stereotypes of good tippers. This may increase the server’s earnings, while creating negative experiences for the many restaurant customers who are women, ethnic minorities, elderly or from foreign countries.
  
  
• On the occasions when a server is punished for poor service by a customer withholding a standard tip, the server can keep that information to himself. While the customer thinks she is sending a message, that message never makes it to a manager, and the problem is never addressed.
  
  
• You can see that tipping promotes and facilitates bad service. It gives servers the choice between doing their best work and making the most money. While most servers choose to do their best work, making them choose one or the other is bad business.

By removing tipping from the Linkery, we aligned ourselves with every other business model in America. Servers and management could work together toward one goal: giving all of our guests the best possible experience. When we did it well, we all made more money. As you can imagine, it was easy for us to find people who wanted to work in this environment, with clear goals and rewards for succeeding as a team.

Maybe it wouldn’t work in every restaurant, in every city. Maybe the fact that it worked so well for us was due to some unique set of circumstances. Then again, other service industries like health care and law aren’t exactly lining up to adopt tips as their primary method of compensation. So maybe we’re all just being suckered into believing tipping works.

It’s something you can think about, at least, the next time you’re waiting on a refill of iced tea.

[007]

Originally Posted by Deberg_1990

A bad waitress who's hot and has a nice rack will make more in tips than a very good waitress who's ugly.


Human nature....
Posted via Mobile Device

I get a kick out of how waitress' always wear the low cut blouse when waiting tables.

[ShortRoundChief]

Originally Posted by Guru

Not to disrespect at all here J, but everything you just listed is what they get paid to do right? Do in house pizza bakers make less than minimum wage like waiters do?

The issue with tipping that gets me is that it used to just be table waiting, bell hops, and bartenders that was the tipped position. Now it seems every position is a tipped position. I'm referring to my local places not places like vegas where everything under the sun is tipped.

I know what you're saying. However the driver generally does less, makes as much per hour (doing the only job he does), gets reimbursed mileage and gets to keep all his tips. Typical driver spends (worse case scenario) ten minutes to your house, talks to you for 30 seconds, and smokes a cig on the way back to the store. So for 10 minutes of "work" he makes double what the people who bust their ass do.

Don't get me wrong, drivers are valuable, but they're kind of like offensive linemen. You don't notice them til they screw up. (which is the sample act of following a gps to your house).

[ShortRoundChief]

Originally Posted by Guru

I get a kick out of how waitress' always wear the low cut blouse when waiting tables.

When I waited tables in high school at was the Blue Oyster and I always wore assless chaps. Seemed to help with tips.

[007]

Originally Posted by J Diddy

I know what you're saying. However the driver generally does less, makes as much per hour (doing the only job he does), gets reimbursed mileage and gets to keep all his tips. Typical driver spends (worse case scenario) ten minutes to your house, talks to you for 30 seconds, and smokes a cig on the way back to the store. So for 10 minutes of "work" he makes double what the people who bust their ass do.

Don't get me wrong, drivers are valuable, but they're kind of like offensive linemen. You don't notice them til they screw up. (which is the sample act of following a gps to your house).

But I thought drivers were paid less per hour and relied on tips to make up the rest like a table waiter. Thats not the case? Not a biggie to me because I always pick up my pizza in person.

[007]

Originally Posted by J Diddy

When I waited tables in high school at was the Blue Oyster and I always wore assless chaps. Seemed to help with tips.

Did you also work at a place where all the barstools were turned upside down and it was called Probe? Always seating for four.

[Demonpenz]

I tipped today at oklahoma joes carry out. You would be surprised the perks that come with it.

[kysirsoze]

Originally Posted by Demonpenz

I tipped today at oklahoma joes carry out. You would be surprised the perks that come with it.

Pics?

[Demonpenz]

this was earlier in the day...lets just say you get hooked up.

[Just Passin' By]

Originally Posted by Fish

You would seriously refrain from an otherwise good restaurant because you couldn't control a minuscule tiny percent of the wage the waiter made? Control of that little difference of gratuity is that important to you? Enough to never return? Over a matter of maybe a single digit percent difference of one transaction out of several dozen throughout that waiter's day? The difference between choosing 18% +/- X, and having to just pay 18%?

Why is controlling that variable important enough to boycott the establishment?

Why Wouldn't it be?

[007]

You can't even leave a poor tip for poor service anymore because they will remember you and give you poor service again if you return. Major problem with tipping right there.

[ShortRoundChief]

Originally Posted by Guru

But I thought drivers were paid less per hour and relied on tips to make up the rest like a table waiter. Thats not the case? Not a biggie to me because I always pick up my pizza in person.

Some companies have went to paying $1 less than minimum wage but at the same time the majority did not. Mileage is paid accordingly so it was hit or miss but in my experience I made money on mileage while putting very few miles on my car.

[Just Passin' By]

Originally Posted by Guru

You can't even leave a poor tip for poor service anymore because they will remember you and give you poor service again if you return. Major problem with tipping right there.

Just remember who your waiter/waitress was and demand someone different.

[Imon Yourside]

Originally Posted by J Diddy

I know what you're saying. However the driver generally does less, makes as much per hour (doing the only job he does), gets reimbursed mileage and gets to keep all his tips. Typical driver spends (worse case scenario) ten minutes to your house, talks to you for 30 seconds, and smokes a cig on the way back to the store. So for 10 minutes of "work" he makes double what the people who bust their ass do.

Don't get me wrong, drivers are valuable, but they're kind of like offensive linemen. You don't notice them til they screw up. (which is the sample act of following a gps to your house).

Drivers now make $4-$5/hr and have the 3rd most dangerous job in America with the Bad drivers and crime. Most of them do A LOT more than just drive the pizza to your house. Even back when I drove I made the pizzas, cut them, prepped up the ingredients and delivered them. They also destroy very expensive vehicles coming to your door.

[Imon Yourside]

Originally Posted by J Diddy

Some companies have went to paying $1 less than minimum wage but at the same time the majority did not. Mileage is paid accordingly so it was hit or miss but in my experience I made money on mileage while putting very few miles on my car.

I used to put 100-200 miles per shift on my car and recently Pizza Hut was sued because they weren't paying enough to the drivers for not only 3-4 dollar a gallon gas but wear and tear on the vehicle.

[HonestChieffan]

Who tips more than 20% really?