6 ms·

One of the things I loved about living in Asia (and traveling to Europe) was all-in prices posted everywhere. Made it so much simpler to add up, and was great p

One of the things I loved about living in Asia (and traveling to Europe) was all-in prices posted everywhere. Made it so much simpler to add up, and was great paying cash due to the even numbers and lack of change. After moving back to Toronto (and now living in SF), my biggest beef at cafes and restaurants is with the Stripe/Square terminals that force the customer to decide whether to tip or not, requiring the user to interact with the screen. Just let me tap my phone/card and be done with it. Raise prices 20% or do whatever you have to do so workers can be paid fairly. Don't make the purchasing UX worse by introducing decision fatigue or guilt.

sasaf5 5y ago
Yes, I can't understand how making things unpleasant for the costumer will work in the long term.
- zwieback 5y ago
  When I grew up in Germany you had to tell your server to their face when they brought the bill how much you want to tip them. Granted, base price includes reasonable service so tips are smaller but still always seemed unpleasant to me. Now, living in the US I got used to putting the tip on credit card bill or leaving as cash (rarely any more), which is a bit better since I have more control over the tip amount although I wish servers got better base pay and tips were smaller. The Square terminal approach actually seems pretty good to me, I feel totally fine leaving a smaller or no tip for counter service or larger for Covid times, etc. Once you get used to the UI it takes 5s to enter custom tip.
jandrewrogers 5y ago
It isn't that simple, this has been tried many times at restaurants in my city. Raising prices 20% and eliminating tipping reduces employee income even though it is nominally revenue neutral because it changes customer spending behavior. Employees don't get paid a 20% service charge for money customers don't spend. The assumption that the customer is not influenced by the structure of the transaction if the final bill would be the same does not hold up empirically. This is not an intuitive outcome, I don't think either restauranteurs or employees expected it when it was first tried, but the result was replicated many times. Since the market for good employees is competitive, restaurants that replace tipping with a 20% service charge have more difficulty finding and retaining employees. Most of the restaurants that tried this here eventually abandoned it because employees were quite reasonably unhappy about the reduced income. It is a fascinating example of the structural complexity of even relatively simple economic transactions.
- fredophile 5y ago
  Has it really been tried? I know individual restaurants have tried it but I can understand customer confusion when one place includes the amount by default but most don't. I think you'd need to do this across a reasonably large geographic area, such as a complete city, to give it a proper test.
  - dboreham 5y ago
    Seattle.
    - fredophile 5y ago
      I assume you're referring to the newish $15 minimum wage. A search for "Seattle restaurants no tipping" gets me a number of articles discussing the subject. From reading them it sounds like Seattle is now a mix of restaurants that discourage tips, restaurants that discourage tips but added a service charge, and restaurants that continue to accept tips. There also seem to be places that have raised prices along with these changes in tipping. I'd note that the places that raised prices seemed to raise them to also cover other increased costs besides just labor. It doesn't seem like Seattle has uniformly embrace no tipping in bars and restaurants.
      - jandrewrogers 5y ago
        I lived in Seattle through this grand experiment and know several restauranteurs personally. The no tipping experiment became trendy several years back, with many restauranteurs converting their restaurants including at many of the restaurants I frequent. It was actually quite jarring because so many restaurants made the transition at around the same time. As a consumer, I simply adapted. However it was quickly reversed because it produced poor results per the telling of both the restauranteurs and employees. At this point, it is experimentally "settled science" in Seattle; you'd be hard-pressed to convince people to try it again given how poorly it went last time.
    - ahepp 5y ago
dan-robertson 5y ago
When I was last in the U.S. it was reasonably convenient: if the price was $X then after tax and a tip, you would pay around £X.
bin_bash 5y ago
It's funny you used Asia as an example when the article literally starts with: > Anyone who has travelled in Asia or the Middle East will be familiar with the concept of ‘++’ pricing. Any published rate you see for a hotel will come with ‘++’ after the price, meaning that you will also be subject to local taxes and a service charge. These are likely to add at least 20% to the total price.

sasaf5 5y ago

Yes, I can't understand how making things unpleasant for the costumer will work in the long term.

zwieback 5y ago
When I grew up in Germany you had to tell your server to their face when they brought the bill how much you want to tip them. Granted, base price includes reasonable service so tips are smaller but still always seemed unpleasant to me. Now, living in the US I got used to putting the tip on credit card bill or leaving as cash (rarely any more), which is a bit better since I have more control over the tip amount although I wish servers got better base pay and tips were smaller. The Square terminal approach actually seems pretty good to me, I feel totally fine leaving a smaller or no tip for counter service or larger for Covid times, etc. Once you get used to the UI it takes 5s to enter custom tip.

jandrewrogers 5y ago

It isn't that simple, this has been tried many times at restaurants in my city. Raising prices 20% and eliminating tipping reduces employee income even though it is nominally revenue neutral because it changes customer spending behavior. Employees don't get paid a 20% service charge for money customers don't spend. The assumption that the customer is not influenced by the structure of the transaction if the final bill would be the same does not hold up empirically. This is not an intuitive outcome, I don't think either restauranteurs or employees expected it when it was first tried, but the result was replicated many times. Since the market for good employees is competitive, restaurants that replace tipping with a 20% service charge have more difficulty finding and retaining employees. Most of the restaurants that tried this here eventually abandoned it because employees were quite reasonably unhappy about the reduced income. It is a fascinating example of the structural complexity of even relatively simple economic transactions.

fredophile 5y ago
Has it really been tried? I know individual restaurants have tried it but I can understand customer confusion when one place includes the amount by default but most don't. I think you'd need to do this across a reasonably large geographic area, such as a complete city, to give it a proper test.
- dboreham 5y ago
  Seattle.
  - fredophile 5y ago
    I assume you're referring to the newish $15 minimum wage. A search for "Seattle restaurants no tipping" gets me a number of articles discussing the subject. From reading them it sounds like Seattle is now a mix of restaurants that discourage tips, restaurants that discourage tips but added a service charge, and restaurants that continue to accept tips. There also seem to be places that have raised prices along with these changes in tipping. I'd note that the places that raised prices seemed to raise them to also cover other increased costs besides just labor. It doesn't seem like Seattle has uniformly embrace no tipping in bars and restaurants.
    - jandrewrogers 5y ago
      I lived in Seattle through this grand experiment and know several restauranteurs personally. The no tipping experiment became trendy several years back, with many restauranteurs converting their restaurants including at many of the restaurants I frequent. It was actually quite jarring because so many restaurants made the transition at around the same time. As a consumer, I simply adapted. However it was quickly reversed because it produced poor results per the telling of both the restauranteurs and employees. At this point, it is experimentally "settled science" in Seattle; you'd be hard-pressed to convince people to try it again given how poorly it went last time.
  - ahepp 5y ago

dan-robertson 5y ago

When I was last in the U.S. it was reasonably convenient: if the price was $X then after tax and a tip, you would pay around £X.

bin_bash 5y ago

It's funny you used Asia as an example when the article literally starts with: > Anyone who has travelled in Asia or the Middle East will be familiar with the concept of ‘++’ pricing. Any published rate you see for a hotel will come with ‘++’ after the price, meaning that you will also be subject to local taxes and a service charge. These are likely to add at least 20% to the total price.