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Tipping strictly prohibitied! Yea or Nea?

So a new BYOB is opening in the hood - No tipping! but prices 30% higher than normal - does this sound like a deal to anyone?

Servers make $11/hr

Customer pays 30% premium

This sounds like a crappy deal to me (unless you are the owner) am I missing something here?

http://www.philly.com/philly/blogs/th...

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  1. "Mora said menu prices would be 10 percent to 30 percent higher, item by item, than similar restaurants."

    No way to tell what the average check's resulting mark-up will be; it might just be close to average tipping range.

    If I lived in Philly, I'd sure go on Tuesday for the lamb ribs. :)

    1 Reply
    1. re: mcsheridan

      I could be enticed almost anywhere for lamb ribs and byob - its true

    2. is $11/hour a living wage in philly? it certainly wouldn't pay boston rent.

      where does the extra 30% go? instead of mucking about with food pricing, why not just add a service charge to each check?

      partners are offering "profit-sharing" to staff, but how long before the place is actually in the black? will they be totally transparent with their bookkeeping?

      this sounds like a place i never would have worked and a recipe for failure.

      6 Replies
      1. re: hotoynoodle

        Philly is more affordable than Boston but not so cheap anymore. $10.80 is what the Mayor has been pushing as "living Wage" minimum for city contracts - people survive on less but its not easy - additionally my impression is that around here servers usually make considerably more - enough to live and focus on their band or art career or whatever - put in a bunch of hard nights a week work hard for those tips and make $$$ be able to focus on other things in life - I don't see them taking this deal, especially since for this place to fly the servers will have to be attractive & hip and also attentive.

        1. re: JTPhilly

          I think politicians pushing for "living wage" is great. The campaign is growing here in the UK. We already have the benefit that "minimum wage" is minimum wage for any adult employee - restaurant server included. And many servers already get paid more than minimum wage.

          Personally, I applaud any restaurant incorporating service into its posted menu prices, as is the custom in France. Failing that, the service charge is definitely the way to go, replacing old fashioned tipping - it's comparitively rare now in the UK that I eat at a place that doesnt have a service charge. Much better all round.

          As for the place mentioned in the OP, time will decide if its a good idea or too revolutionary for the locality. As indicated in the linked article, there are other employee benefits, including profit share. These sound like good employers to me. Staff will stay if they are happy with their income and leave if its not. Customers will similarly eat there if it's pricing is on par with other places and not eat there if its not.

        2. re: hotoynoodle

          The extra 30% goes to paying people $11/hour, paying the employer's share of healthcare as well as sick days. Is that a high upcharge? No idea.

          Servers have a normal rate of $2.83/hr and the business has to pay them out at $7.35/hr if they can't make up the remainder in tips. So at the very least they're paying $3.65/hour more in wages. Add the cost of benefits in and it's appreciably more. Does it add up to 30%? Who knows. If it has to add up to you precisely then go eat somewhere else.

          1. re: ferret

            i spent 20 years working in restaurants.

            this may help you understand that the 30% extra these guys wanna charge is a crock of shit:

            http://boldprogressives.org/2013/03/w...

            1. re: hotoynoodle

              That's not even close to what this is about. This is taking waitstaff, who are not generally given employee benefits and bringing them in as full employees. It's not a matter of pennies a meal. It's a far more significant shift. Working in a restaurant does not give you the perspective of a business owner.

              1. re: ferret

                i have managed high end dining rooms and high-ticket beverage programs. i understand the economics of running a restaurant as a business.

                randomly upcharging on dishes seems a peculiar way to go about this, regardless. that's what service charges are for.

        3. Long but interesting rant on tipping from Jay Porter, who ran The Linkery in San Diego (now closed) which had a no tipping policy... http://jayporter.com/dispatches/obser...

          2 Replies
          1. re: firecooked

            right, but they had a service charge, not inflated menu pricing.

            1. re: firecooked

              From the Cornell paper http://tippingresearch.com/uploads/ma... linked in that dispatch, regarding how to generate more tips by increasing sales:

              "Therefore, have servers turn tables and sell more entrees when possible. When turning tables is not possible, then have servers sell more appetizers and desserts."

              I was under the impression that servers often think of diners in that first category (who focus on mains & don't stay long) in a negative light, whereas this paper suggests that they should not.

            2. It seems that a straight 20% service charge would be easier for the patron to understand; one could then easily decide whether the burger price or the fajita price or the salad price was "reasonable". Who wants to do math on every single item to figure that out?

              1. seems like the owners are greedy.. the servers will make less than an average similar restaurant and the owners will keep the difference

                3 Replies
                1. re: kpaxonite

                  If the owners are being honest, their servers will make out on medical benefits, *sick days* (hooray!) and profit-sharing. If they're not, word will get around, few good servers will go there, and they'll fail. And again, the price bumps are *from* 10% TO 30% - what the average check bump-up remains to be seen.

                  1. re: mcsheridan

                    11 dollars an hour is pretty horrible wage for most servers

                    1. re: mcsheridan

                      PROFIT SHARING?????

                      you don't seem to understand that the goal of restaurant accounting is to minimize tax liability for the owners.
                      showing tons of profit will not do that.

                      also, now that the afforable care act is in place, if the employees are making a reasonable wage, they will be able to pick and choose the health plan that SUITS THEM and one that WILL TRAVEL WITH THEM as they change employers.

                      personally, i like the "chain of custody" of the money that is meant for the employee to be as short as possible. ideally, i like to leave cash in my server's hand. not too thrilled with the idea of the owners getting involved with this.