The point is that the menu prices should not need to go up, because tips should never have been a necessary part of their profit margins.
They were literally subsidizing their expenses (including payroll) with tips, and that’s made evident by the fact that the prices had to go up when tips were ended.
If your business cannot afford to survive without paying your employees a living wage, then your business shouldn’t exist.
Ok, well, most restaurants have notoriously small margins (3-5%) with tipping. So, setting aside what you think should and shouldn’t be, what is an actual solution? Eliminate tipping and raise prices? Restructure the agricultural pipeline to lower costs? Cap commercial real estate prices to reduce rental overhead? Because as it stands now, you can’t eliminate tipping without getting the money somewhere, and it’s not in the restaurants profits.
The point is that the menu prices should not need to go up, because tips should never have been a necessary part of their profit margins.
They were literally subsidizing their expenses (including payroll) with tips, and that’s made evident by the fact that the prices had to go up when tips were ended.
If your business cannot afford to survive without paying your employees a living wage, then your business shouldn’t exist.
Ok, well, most restaurants have notoriously small margins (3-5%) with tipping. So, setting aside what you think should and shouldn’t be, what is an actual solution? Eliminate tipping and raise prices? Restructure the agricultural pipeline to lower costs? Cap commercial real estate prices to reduce rental overhead? Because as it stands now, you can’t eliminate tipping without getting the money somewhere, and it’s not in the restaurants profits.