A hot topic in the foodservice industry right now is the potential of eliminating tips. Legendary New York restaurateur Danny Meyer was the first to announce a no tipping policy. Last week national restaurant chain Joe’s Crab Shack indicated they were heading in this direction. So what’s next?
What is the rationale behind the no-service gratuity model? Restaurateurs will pay their servers, hosts and bartenders higher, fixed hourly wages which will improve the team performance of their workers and reduce turnover. Oh yes, to cover this business model, menu prices will obviously be increased potentially 15 to 20%. Will this policy go mainstream? More importantly, will diners be comfortable with this move?
So what’s next? Maybe Foodsy, a new restaurant in Amsterdam has the ultimate solution to a no tipping policy. They have eliminated their staff altogether. Guests are provided menu recipe cards. Then guests use either raw/fresh or prepared ingredients to cook and serve themselves. They are even provided instructions how to tap their own beer or brew coffee. At the end of their experience, patrons pay via an iPad app. Due to the elimination of staff, most of Foodsy’s meals are cheaper than other restaurants.
How do you vote? To tip or not to tip!