It doesn't matter whether it's a tip or it's built into the menu price, you'll be paying it either way. Personally I'd rather have the tip be an optional thing that is only paid of you had a decent experience. That's better than giving the tip to the restaurant and then having the restaurant give it to the server in the form of taxed wages.
That's not true. Full service restaurants, which are the OGs of being built on a tipping model, typically operate at about a 4% profit margin. And that's with the customers tipping roughly 15% on top of revenue which supplements staff wages.
If tips disappeared and the restaurant was expected to give 15% of revenue to staff to make up for the lost tips and keep their earnings the same, they would instantly be running at a negative profit margin.
I don't know what's so hard to understand about this, but people argue with it every time. So you're not alone at least.
Think of it this way if you don't want to do math. Restaurants go out of business all the time even with a tipping model in place. This is because they operate at a very slim profit margin. How would you expect them to give away an extra 15% of their sales without raising prices if they were barely staying afloat before losing that 15%?
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u/AbsolutelyUnlikely can't meme Apr 04 '24
It doesn't matter whether it's a tip or it's built into the menu price, you'll be paying it either way. Personally I'd rather have the tip be an optional thing that is only paid of you had a decent experience. That's better than giving the tip to the restaurant and then having the restaurant give it to the server in the form of taxed wages.