If I was running a restaurant today, how would I handle all the issues surrounding tipping and tipping culture?
Four suggestions:
1. I would implement a required service charge of twelve percent. I would make it clear on the menu and on the receipt that this fee is one hundred percent paid to the customer's server only. Not all servers and not the management. I would make sure that it is clearly indicated that this amount is twelve percent. For parties of six or more, I would make this amount seventeen percent.
If labeling this fee a service charge is confusing, fine, I would label it required tip. Because that is what it is. Not trying to hide anything or confuse anyone. And to clear up any confusion, the menu sets the price, not the receipt. But I would include pricing, fees, and explanations in both places. I might even have servers disclose, pre-order, if the policy is new. Transparency is vital.
2. In order to offset the inevitable pushback for the required tip, I would place a Rate Your Server section on the receipt right under the itemized required service charge. This would be a preprinted 1 through 10 scale that diners could quickly circle. If some amount of tip is required, diners will still want to way to express their view of the service.
3. Right under the Rate Your Server section I would include an Additional Tip blank line, leaving the amount entirely to the diner.
Different demographics tip differently. And some people do not tip at all. In my view, if the service is good, that is unacceptable. This would insure that the server makes at least twelve percent. If the diner is displeased with the service, they can give the server a low rating. And yes, if a server consistently receives low ratings, they can be replaced.
Twelve percent is on the low end for tips. If it is to be required, I think that is where it needs to be. Not even at the traditional fifteen percent level. No, I am not sure if people would actually add the Additional Tip. If we later need to raise the required percentage, or even raise menu prices and pay staff more, so be it.
The reason that I do not suggest starting with higher menu prices and salaried servers is that most servers do better in tips than any salary an establishment could pay them. And to keep good servers, we need to pay them appropriately. I do not care what they do in Europe; tipping is a better choice for the servers.
But something has to be done. Whatever it is, free service should not be an option for customers. Too many customers take advantage of the current system for free service. They run the servers ragged, and then they do not pay them. And they are not the least bit ashamed of it. This behavior is disgusting and we must stop it.
The twelve percent will never be removed. This will be explained to diners in advance. Think of it as part of the cost of the meal. Is this ideal? Probably not. Will it anger some customers? Probably so. But there is no way to make everyone happy in modern tipping culture.
In a recent post on business responses to our deteriorating culture, I suggested prepayment for most services. I stand by that, and it would include the required service charges. Changes, add ons, and extra tips can be adjusted after the meal. Is this more hassle for the establishment? Absolutely. But eroding standards of behavior have made it necessary. I believe people of goodwill will understand. At this point, everyone has seen the bad behavior.
As I mentioned in that earlier piece, one of my goals is to limit discussion with people who can never be satisfied. For tipping, I want to create a fair and easy to understand system that is not really open to a lot of discussion. Post it on the door if you have to, but we are not going to sit here and argue about it. Because we charged you in advance, this discussion is over. It is time for you to leave.
Dine-and-dash crimes, non-payment for unjustified complaints, and leaving little or no tip; these behaviors are getting out of hand. I have always believed that restaurants should take a firm line on bad customer behavior. Even at the risk of losing some customers. Even at the risk of some bad publicity. These customers end up costing you too much anyway. Do not allow them to cost you your entire business.
So let's push the limits here. Question: Are the above policy changes not going to encourage patrons to go home and simply dispute their credit card charges? Yes, I worry this will be the result.
4. After taking an order, but before the server submits it to the kitchen, the customer will prepay for the order. In cash.
I'm sorry, but in any business with a high likelihood of credit card dispute, cash is the best, and only, insurance. Otherwise, you rely on the customer's credit card company. Not your company; the customer's company. And how do you dispute supposedly bad service based on the inevitable claims that you are racist? You are going to lose. Plus how do you want to spend your time? Running a restaurant or handling credit card disputes that you will most often lose?
I do not care about restaurant industry standards or customs. I do not care about the push for a digital currency. And I am not chasing a Michelin star. What I do care about is getting paid without a lot of guff. I would gladly explain the policy to any customer. This explanation would necessarily come in advance, so there will be no trouble about it. Pay cash in advance or leave, those are the only options.
If I can afford it, I would have a no-fee ATM installed.
Whatever it takes, but I am going to get paid. Here is the bottom line question: Is it better to guarantee payment from a more limited number of customers or to plan for and expect write-offs from the ever-increasing number of people who are going to give us a hard time and not pay anyway?
For all types of restaurants, I would consider re-thinking the seating process. Before we seat diners, they must pay first. Maybe at a counter, or maybe in a comfortable pre-seating area. They can take their time making selections, etc.
Yes, it is radical. Especially for upper-mid to high-priced establishments. But again, do you want to risk your business for dodgy, disdainful customers? Obviously, no restaurant is going to implement all, or maybe any, of these ideas. I just want restaurant owners and managers to think outside of the box. I hate that expression, but here, I think it is appropriate.
We must come up with ways to stop the nonsense.
















