I’ve noticed a growing trend in the world of eating out, specifically for restaurants like:
- take-out joints for lunches
- smoothie shops
- ice cream parlors
- sandwich shops
- pizza places (non-delivery)
For years, these take-out establishments have been content with setting their prices to cover their expenses and make a healthy profit. Somewhere along the line, a genius business person came up with the idea that putting a tip line on the receipt and forcing people to sign for the transaction might boost profits!
From a business point of view, this is brilliant. Just about anything collected on a tip is pure profit and:
- Having a tip line on a receipt makes it feel like a tip is expected and customary, increasing the likelihood that one will be left.
- A 20% tip on a $7 lunch bill is about $1.50, but people feel stingy leaving that kind of tip, so they leave $3 or $4 instead (blowing up the tip to almost 50%!)
Why I don’t tip here
In my opinion, a tip is something asked for and received when a service is performed—in the case of restaurants, that’s the act of cooking, serving, busing, seating, etc. But one can also make the case that a lot of those things are happening when we visit some of these smaller joints.
I base my decision on the simple fact that these places have never before asked for tips. That leads me to believe that this is nothing but a move to increase per-check totals and boost revenue, not a genuine move to “reward” the service of employees.
In addition, most of these places have cash tips jars sitting on the counter already, and both generous regulars and off-hand visitors do a fair job of making their happiness known.
The other side of the story
On the other hand, I’ve been considering the employee implications of my decision lately. Legally speaking, if the “restaurant” asks for tips, is it no longer obligated to pay their employees minimum wage? (You might recall that minimum wage for tip-based workers is much lower.) If that’s the case:
- my refusal is eating into employee’s paychecks, and
- it’s stopping making restaurant owners some serious money through a double-whammy: lower payroll costs and increased revenue.
Talk about being stuck between a rock and a hard place—we don’t want our costs of living to go up, but we also want to be fair to the people who help us.
What’s your take?
Do you tip at these kinds of restaurants, and why or why not? Considering some of the reasons I’ve outlined, are you likely to change your mind? Is it customary and expected to tip there, and I’ve just missed the boat completely?
Photo by realSMILEY