Should You Place a Tip Jar in Your Restaurant?

tip-jarTipping is an integral part of American dining culture. Customers have no obligation to leave a tip, but it has become customary to leave 15 to 20 percent of the overall bill for a job well done. Servers in most states rely on tips to earn a living wage, as they receive a sub-minimum wage from their employers. The abundance of tipping is spreading, and a trend has emerged that has resulted in tip jars appearing near cash registers at takeout restaurants, ice cream parlors, sandwich shops, and coffee houses. Before you decide to place a tip jar on the counter of your restaurant, you should take all of the positive and negative effects into consideration.

How do customers feel about tip jars?

The mere presence of a tip jar is enough to make certain people feel uncomfortable, and many other customers are completely against the idea of tipping someone for doing a job that they are already paid to do. For other customers, tip jars are acceptable unless they are accompanied by an annoying or offensive message.

Some customers are very receptive to the idea of tip jars and will leave a tip almost every time. These are likely the same patrons that will tip your employees even if no tip jar is available. The addition of a tip jar will not alter the spending habits of these customers.

The majority of customers are indifferent to tip jars, and will only tip if the service they receive is exceptional. Simply placing a tip jar on the counter of your restaurant will likely NOT affect the amount of business you receive, but it can certainly alter the customer experience in a negative way if it is not implemented respectfully. Asking or begging for tips can make customers feel uncomfortable, and it may affect their decision to return to your restaurant in the future.

When asked to comment, several Instawares customers weighed in on the subject of tip jars. On the issue of potentially offensive messages attached to tip jars, Kellie said, “I do not like it when it says ‘Gas Money’. No one buys my gas for me!” Roy commented, “Yes I leave tips. Those people are working just as hard as waitresses and waiters.” Kathleen helped to support the majority opinion by stating, “As with all tips, the amount depends on the quality and friendliness of service.”

How do employees feel about tip jars?

This is an easy question to answer, right? All employees love tips, and more money is always better than less money. The relationships between employees, however, can be strained by the presence of a tip jar, especially if the tips are divided equally among everyone. Employees that work hard and earn tips by providing exceptional service can actually earn less money once a tip jar is implemented. Customers that normally tip directly to an outstanding employee may feel more inclined to place the tip into the jar. The tip will then be shared among the other employees that may not be as deserving of the bonus. This situation can lead to tension and arguments between employees, which will hurt the overall morale of your staff.

Some establishments have been known to keep all of the money collected from the tip jar without sharing any profits with the employees on duty. This is an incredibly deceptive practice that should be avoided, as it violates the trust of the customer and shows your employees that you do not value their contributions to customer satisfaction. Profit margins may also be negatively affected, as some employees will offer free or discounted goods and services in exchange for a larger tip.

Tips can encourage your employees to provide excellent customer service, but there are many risks involved with introducing a tip jar to your restaurant. Ask your employees if they would prefer a tip jar or not, and try a trial run before making a final decision. Ask customers for feedback during the trial run to help determine if a tip jar is right for your particular establishment.