26 October 2015
Is Tipping a Thing of the Past?
Is restaurant tipping a behavior of the past? Will all restaurants begin implementing a “no tipping policy”? Danny Meyer’s Universal Hospitality Group has started utilizing this policy. Instead of requiring customers to tip, the overall price of the menu was increased allowing the company to keep a steady revenue flow. The main purpose of removing tips is to advertise wage balance between employees. Waiters are usually the only employees in a restaurant to get tipped, therefore, creating a larger gap between their paycheck and that of the kitchen staff. The outcome of this change, while having negatives, will most likely end up being more beneficial to companies and customers. (Drew)
To compensate for not receiving tips, companies are raising the prices of their food. When people see the high prices, it scares them. These people may look for possible substitutes including, fast food restaurants where they don’t have to tip or eating more homemade meals. These consumer decisions could really hurt the restaurant business. The question remains: will the opportunity cost of diminishing tipping be beneficial for the company in the long run?(Jones)
While it seems there are many negatives of banning tipping, there is an outweighing amount of positives. With the balancing of wages, employees will overall be more happy. Consumers will not stop demanding restaurant made food. Once, people catch on to the idea that in reality they are not paying more for their food/service, they will most likely take a liking to the new ways. Danny Meyer said, “You don’t tip your doctor if they do a good job. You don’t tip the airline pilot if the plane lands…. “ Meyer addresses a very true point. The restaurant business if one of the few places where we use gratuity as a recognition for good service.
Thinking about it, tipping really is becoming a thing of the past. It is inconvenient and an added stressor when eating out. Having gratuity built in to meal costs, will not only balance wages and make employees happier, it will allow the customer to enjoy their meal without having to worry about how much they are going to tip.
Jones, Charisse. "Danny Meyer Says There Will Soon Be No Need to Tip at His New York Eateries." USA Today. Gannett, 15 Oct. 2015. Web. 26 Oct. 2015.
"Is This a Tipping Point for Tipping?" CNBC. 16 Oct. 2015. Web. 26 Oct. 2015.