4 ms·

Tipping is a tough problem: if you pay customer facing employees more, you'll need to raise prices. If your competitors still have a tipping expectation, their

Tipping is a tough problem: if you pay customer facing employees more, you'll need to raise prices. If your competitors still have a tipping expectation, their menu prices will be lower. And let's be real, most customers aren't savvy enough to think about that ahead of time, which is why most restaurants that have attempting no-tipping systems in North America have failed (or reverted back to accepting tips). There's also a segment of the population that enjoys the perceived power of holding a tip over an employee's head.

acdha 2y ago
Most people do think about pricing - not to the penny, sure, but you have to be really rich not to have an idea about roughly where going out will fit in your budget. There are two reasons why tipping is popular: restaurant owners think it motivates employees to flatter/put up with customers and/or allows them to skim some extra income, and there’s a certain type of diner who loves the power imbalance (e.g. every guy who sexually harasses waitresses loves pushing to see how much they can get away with, or the demanding people who calibrate their behavior just below the level where someone’s going to decide that the chance of a tip isn’t worth it). The first group likes to tell high-income service workers that their pay will go down without tipping, which is fairly effective at finding people to be the media front saying workers don’t want to get rid of tipping instead of the other 90% who are guaranteed to benefit.
- dismalaf 2y ago
  > Most people do think about pricing No offence but you're kind of proving my point. I said nothing about a difference in pricing because there isn't unless you actually tip $0 (which statistically very few people do). $24 (restaurant includes tip in price in order to pay servers a fair wage) is the same as $20 + 20% tip. Most of the rest of your comment is what I said with different wording. > high-income service workers There's very few high-service income workers. I served tables through university, even if you make $400 in one night there's not enough of those nights for you to be "high income". If you're a stellar server working full time you can maybe equal what an average accountant makes in a year (which is pretty mediocre), but with more stress.
  - acdha 2y ago
    If your argument wasn’t that a no-tip restaurant would seem higher priced, what was the purpose of your second paragraph? > There's very few high-service income workers. Yes, we’re in agreement? I was just referring to how the opposition here would trot out quotes from some bartender who makes $75/hour and not mention that they were the upper fraction of a percent and the median was considerably lower.
    - dismalaf 2y ago
      > If your argument wasn’t that a no-tip restaurant would seem higher priced Of course it seems higher priced. That's the point. Perception. Seeming higher priced != higher priced if there's the expectation of tipping and you follow it, but the average consumer isn't very savvy so it ends up scaring them away. Which is why restaurants that try to include service in their pricing end up reverting or failing. Also the only opposition is really from consumers (which then spills over to owners who get to hear all the complaints). Europeans get along fine with not tipping.
  - ac29 2y ago
    > There's very few high-service income workers. I served tables through university, even if you make $400 in one night there's not enough of those nights for you to be "high income". I wonder if this has changed as both prices and tip percentages have gone up. At $50/person tickets and a 20% tip, you'd only need to serve 100 people to make $1000 in tips. 100 people a night is unrealistic for many restaurants, but I'd think a server working full time could easily do a couple hundred customers a week which is $100k/year in tips.
dredmorbius 2y ago
Prisoner's dilemma. <https://en.wikipedia.org/wiki/Prisoner's_dilemma https://en.wikipedia.org/wiki/Prisoner's_dilemma>
- dismalaf 2y ago
  Absolutely.

acdha 2y ago

Most people do think about pricing - not to the penny, sure, but you have to be really rich not to have an idea about roughly where going out will fit in your budget. There are two reasons why tipping is popular: restaurant owners think it motivates employees to flatter/put up with customers and/or allows them to skim some extra income, and there’s a certain type of diner who loves the power imbalance (e.g. every guy who sexually harasses waitresses loves pushing to see how much they can get away with, or the demanding people who calibrate their behavior just below the level where someone’s going to decide that the chance of a tip isn’t worth it). The first group likes to tell high-income service workers that their pay will go down without tipping, which is fairly effective at finding people to be the media front saying workers don’t want to get rid of tipping instead of the other 90% who are guaranteed to benefit.

dismalaf 2y ago
> Most people do think about pricing No offence but you're kind of proving my point. I said nothing about a difference in pricing because there isn't unless you actually tip $0 (which statistically very few people do). $24 (restaurant includes tip in price in order to pay servers a fair wage) is the same as $20 + 20% tip. Most of the rest of your comment is what I said with different wording. > high-income service workers There's very few high-service income workers. I served tables through university, even if you make $400 in one night there's not enough of those nights for you to be "high income". If you're a stellar server working full time you can maybe equal what an average accountant makes in a year (which is pretty mediocre), but with more stress.
- acdha 2y ago
  If your argument wasn’t that a no-tip restaurant would seem higher priced, what was the purpose of your second paragraph? > There's very few high-service income workers. Yes, we’re in agreement? I was just referring to how the opposition here would trot out quotes from some bartender who makes $75/hour and not mention that they were the upper fraction of a percent and the median was considerably lower.
  - dismalaf 2y ago
    > If your argument wasn’t that a no-tip restaurant would seem higher priced Of course it seems higher priced. That's the point. Perception. Seeming higher priced != higher priced if there's the expectation of tipping and you follow it, but the average consumer isn't very savvy so it ends up scaring them away. Which is why restaurants that try to include service in their pricing end up reverting or failing. Also the only opposition is really from consumers (which then spills over to owners who get to hear all the complaints). Europeans get along fine with not tipping.
- ac29 2y ago
  > There's very few high-service income workers. I served tables through university, even if you make $400 in one night there's not enough of those nights for you to be "high income". I wonder if this has changed as both prices and tip percentages have gone up. At $50/person tickets and a 20% tip, you'd only need to serve 100 people to make $1000 in tips. 100 people a night is unrealistic for many restaurants, but I'd think a server working full time could easily do a couple hundred customers a week which is $100k/year in tips.

dredmorbius 2y ago

Prisoner's dilemma. <https://en.wikipedia.org/wiki/Prisoner's_dilemma https://en.wikipedia.org/wiki/Prisoner's_dilemma>

dismalaf 2y ago
Absolutely.