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Tip pressure might work in the moment, but customers are less likely to return

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Re: Tip pressure might work in the moment, but customers are less likely to return

#61

Post by hattmall »

dataflow wrote: post #34
acchow wrote: post #9

Earlier quoted context omitted.

It's a broken system but it will never go away since tips are tax-advantaged (there's no sales tax on the tip). The mental block can be helped a little by adding 1/3rd to all the menu prices as you read them.

> tips are tax-advantaged (there's no sales tax on the tip) Someone please correct me if I'm wrong, but the bigger tax that's avoided here is corporate taxes, I think. The tip goes directly to the employee, and it's thus not taxed as corporate income, is my understanding. EDIT: Ah, I missed that corporate taxes were on net earnings rather than gross, so this wouldn't make any difference. Thank you!

No wages are deducted so they don't pay income taxes on them anyway.

Re: Tip pressure might work in the moment, but customers are less likely to return

#62

Post by alephnerd »

FYI - The tipping option on Square POS is a default setting that automatically generates default tip ranges.

In a lot of cases, the vendor just enables tips and doesn't care to optimize.

Alternatively, you could always tip in cash or just not tip. I've never been in a situation where I've been forced to tip and I've eaten at restaurants at all ranges of quality.

Re: Tip pressure might work in the moment, but customers are less likely to return

#64

Post by jghn »

FireBeyond wrote: post #39
jghn wrote: post #25

Earlier quoted context omitted.

When this started showing up near me the places that did it trained their staff to tell you up front that it was on there. They'd make a comment that you can add extra if you wish, but no obligation to do so. Over time I've found more and more they just don't mention it at all. More than once I got home and realized I tipped on top of the total + service charge: "Why was that about $100 more than I thought it'd be?",…

> More than once I got home and realized I tipped on top of the total + service charge: "Why was that about $100 more than I thought it'd be?" Assuming the service charge was even 15%, for it to be $100 more than you thought it would be, your bill would be $600+ (simplifying for taxes)... I don't go out for $600 dinners that often, though I have. And that being said, I do think tipping does bring out some less sensic…

To be fair, by "more than once" I meant 2-3 times, not a regular occurrence. :)

The last time it happened was ~300 + 20% service charge + a tip that'd have been in the low-mid 20's. That works out to be a bit under $100. It started to bug me on the walk home, and I double checked the receipt. I don't like scrutinizing receipts but I've started to do it a bit more.

> why should the server get five times more for serving me a single bottle of wine if the wine was $100, versus $20? It was still a single bottle of wine.

The argument, which one can choose to agree with or not, is that the kind of place where one is buying a $100 bottle of wine has a higher degree of training, care, etc involved.

Re: Tip pressure might work in the moment, but customers are less likely to return

#65

Post by jltsiren »

Karupan wrote: post #7

I dread the day I have to eat at US restaurants, or even get something delivered. Part of the reason is cultural: I’ve never lived in a country where a tip is mandatory and you’ll be called out if you don’t. The other reason being it involves a degree of social pressure and shame, if one doesn’t tip enough. Both don’t sit well with me. But I can attest that if I’m forced to tip, I’ll not return to that establishment.

I'm also from a culture where tipping doesn't happen. I've been living in the US for a number of years, and I rarely go to a restaurant here, because the experience is too awkward.

On the other hand, I find delivery services quite reasonable. They tell me the total price (including the expected tip) before I order. You rarely see that kind of honesty in an actual restaurant. And I don't have to see the person I tip, which makes the experience much less awkward.

Re: Tip pressure might work in the moment, but customers are less likely to return

#66

Post by anal_reactor »

xscott wrote: post #6

The other one I'm seeing lately is a semi-stealth "service charge" on the bill. Something like 18% to 20% added to the bill without really standing out. This used to be something they'd do for "larger parties", but now I'm seeing it even when I'm eating solo. This makes for an uncomfortable situation where I now have to ask the waiter or bartender if they receive this as a tip. Then I need to decide if I want to tip…

>This used to be something they'd do for "larger parties"

I always thought that economy of scale makes it cheaper to process big orders in batch, but apparently I'm wrong

Re: Tip pressure might work in the moment, but customers are less likely to return

#67

Post by anal_reactor »

jaco6 wrote: post #19

I work at a Dominos and we of course accept and expect tips on delivery, because without tips the drivers would make But at checkout for carryout orders the card terminal also now opens a tip menu. I would never tip on this screen because the employees are already paid a true hourly wage, albeit a low one, not a server rate that is below minimum wage. Furthermore there is no way for the customer to know if the employ…

>the drivers would make Not my problem

Re: Tip pressure might work in the moment, but customers are less likely to return

#68

Post by jghn »

anal_reactor wrote: post #66
xscott wrote: post #6

The other one I'm seeing lately is a semi-stealth "service charge" on the bill. Something like 18% to 20% added to the bill without really standing out. This used to be something they'd do for "larger parties", but now I'm seeing it even when I'm eating solo. This makes for an uncomfortable situation where I now have to ask the waiter or bartender if they receive this as a tip. Then I need to decide if I want to tip…

>This used to be something they'd do for "larger parties" I always thought that economy of scale makes it cheaper to process big orders in batch, but apparently I'm wrong

autograts for large parties are done because large parties tend to be poor tippers vs normal sized parties for various reasons.

Re: Tip pressure might work in the moment, but customers are less likely to return

#69

Post by paleotrope »

kevin_thibedeau wrote: post #15
muzika wrote: post #2

Let’s have restaurants raise prices to cover employee salaries, and make it illegal for them to ask for tips. Customers who want to tip need to do so without solicitation. (Not sure how this would work with credit card terminals though).

The terminals are the problem. If people would abandon a cashless lifestyle they can tip normally without the electronic shame box.

All that will happen is people will develop scar tissue and just not tip anymore. People used to be polite and be nice when they picked up the phone from some number they didn't recognize. Scam artists USE this old custom to scam people. Well, most people don't even pick up the phone any more and for people that have to, like myself, the instant I recognize a cold call, I just hangup. I don't feel guilty about it anymore, in fact, I feel empowered.

Tipping at terminals is going to happen the same way. The idea that some minimum wage person is gonna recognize you, let alone still working at these places will key you in on this is just something that will go away.

Tip at a sitdown restaurant, that's normal. Tipping at a terminal for takeout, screw that.

Re: Tip pressure might work in the moment, but customers are less likely to return

#70

Post by TheDong »

add-sub-mul-div wrote: post #55
TheDong wrote: post #17

Earlier quoted context omitted.

A 3% fee for a card makes perfect sense to me. That's not far off from what the merchant is losing for credit card customers, so their options are: 1. Charge the same for credit cards as cash, and make cash paying customers effectively pay more, thus applying a regressive tax to the poor (who are less likely to have credit cards) 2. Charge more for the credit card paying customers, and they can avoid this extra payme…

It's not whether the behavior is logical or justified. It's that fast food is no longer worth the price you're expected to pay for it. Regardless of whether it's credit card fees or labor costs or energy costs causing prices to go up, the economics of fast food no longer make sense for the customer. But also I don't understand why a cash customer paying the same price as a credit card customer should be considered pa…

> why a cash customer paying the same price as a credit card customer should be considered paying more

The credit card customer gets rewards often amounting to around 2% of the value of the item.

Those rewards come out of the money the merchant is paying to the credit card company.

The cash customer did not get those rewards, and so paid more.

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