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Forced restaurant service charges can damage the customer experience
In recent months I have experienced behaviour from restaurants which I can’t quite fathom. When I receive the bill a service charge has already been added. And not just at my usual 10% rate, which I thought was standard in the UK, but at 12.5% or even 15%.
A tip should reward good customer experience
I am not a skinflint, but I have my own rules for paying a tip. The waiter/waitress has to be a bit special, by doing something nice that makes me enjoy my experience that little bit more. It’s not difficult to wait on me with a smile, to be there when I need a new bottle of wine, to provide a recommendation, or to know where my food is sourced from. And I am happy to pay 10% in cash to the particular waiter or waitress who has made my eating experience a good one.
So when I sit at a cramped table, eating average quality food that I could have made at home, and have difficulty in attracting the attention of the waiting staff (or receive too much attention), I don’t feel inclined to leave a tip. But wait. This already expensive meal, of average quality, has a 15% service charge automatically added to the bill.
The credit card machine provides no obvious option to remove the service charge from my bill payment. The only way to do this is to request it, making the process more confrontational for customers. I’m sure leaving a tip used to be a discreet affair!
In true British style I decide not to make a fuss. But I muse on it for days. Who decided to change the rules? Who has suddenly decided that us Brits are always happy to pay a tip? Who decided that this tip was to be 15%?
My answer? I won’t visit this restaurant again and I’ll warn my friends of it.
Delivering beyond customer expectations must become a priority business objective
I believe this is a case where internal process and business objectives have become the main focus without considering the customer. Yes, the business needs to make more money, and yes the waiting staff would like tips. But surely you are more likely to build loyal customers by focusing on the experience and the food? And surely the customer should have the choice to leave a tip to waiting staff that have waited particularly well?
There are reports that take-away food is becoming more popular as customers “Trade down”, by wishing to spend less with the economic uncertainty that looms. So a restaurant that automatically increases its pricing by adding a 15% service charge is not going to entice customers.
It is also important for restaurateurs to ensure their customers know what will happen to the tips they leave. It is disheartening to think that my tip is being used to top up salary. So it is comforting to see that the law is being updated. However, the choice must remain with the customer.
Understanding customer needs, meeting their expectations, and giving them the choice to tip is far more likely to encourage repeat visits. So companies must balance the business and customer objectives to ensure a sustainable and successful service.
Have you pushed forward your business goals without considering your customers’ goals?
Related services: Customer Profiling, Customer Experience Research, and Customer Requirements Capture