Bar Nine, a roaster and cafe in Los Angeles' Culver City, recently announced starting January 1st 2016 they will be eliminating tipping from their service model.
If you've ever worked on bar—regardless of your passion for coffee, level of experience and dedication to the craft—you are probably well aware, you are not in a position to make very much money. In fact, the recently released documentary film Barista states "The average salary for a Barista is $15,084 per year." Though living on this meager income is a reality for most people in service focused jobs, many baristas and servers take comfort in knowing that what their hourly wage lacks, can often be padded with customer tips. So, why is Bar Nine choosing to do away with them?
The issue at hand, which has be plaguing coffee professionals for quite some time, is how to make a viable career in hospitality. Low wages squeeze out talent and encourage short term, part time workers. At the pinnacle of their craft, workers in Specialty Coffee service experience a discrepancy between their capabilities and their financial reward. The (aforementioned) film Barista follows five professionals who have dedicated their lives to coffee, excellence in service and competition, does a good job at expressing this sentiment. Ryan Redden, one of the competitors featured in the film, shares his frustration, "That's what you're doing all the time at the highest possible standard that you can hold yourself... and then yeah... you walk away with the same paycheck as if you were slinging a McDouble at somebody's face... through a drive through." On January 1st, Bar Nine's move to eliminate tipping is a step toward closing this gap for the Specialty Coffee industry and all hospitality based careers alike.
Since day one, Bar Nine has made it a priority to provide exceptional service alongside expertly prepared coffee. To this end, the company has been continually looking for ways to improve upon transacting with customers and to make room for careers in coffee—they had been thinking of eliminating tipping for a while. It wasn't until New York restaurant mogul Danny Meyer announced he is in the process of rolling out an ambitious plan to eliminate tipping across his 13 full service restaurants that Bar Nine was encouraged to go for it.
I had the opportunity to ask Zayde Naquib, co-owner of Bar Nine a few questions about making the move to do business better by eliminating tipping...
tLBCC: What’s wrong with the traditional model of customers’ incentivizing baristas with tips?
Zayde: Ultimately the question is, do we want our guests to "take care" of our bar team, or do we want our bar team to take care of our guests? As hospitality-focused people, we'd like to present a situation where the obligation to tip, as it makes up a large percentage of someone's pay, gets removed from the transaction. So we're going to present a scenario where the full cost of labor is included in the price, along with sales tax, etc. We'll be removing the need to sign for most purchases too as our average ticket is pretty small, so the transaction part of the process will now feel like somewhat of an afterthought, keeping the focus on the parts of the experience that matter the most. And, I think being able to completely take care of our team is important to our values as a business.
In addition to the feeling of obligation, most people are "automatic" tippers, in that they tip whatever they tip regardless of circumstance. Tipping is very rarely used as a means of rewarding good service. We want great hospitality, in addition to wonderful service and product, to be a given at our establishment, and I don't want to see people motivated because they might earn extra cash, I want our team to be motivated to be on our guests' side because they truly care about giving them a great experience. Those are the people that make up our team, and this move will enable that to shine even further.
tLBCC: You are instituting a revenue sharing program. Can you tell us a little bit about this program and what you are trying to achieve?
Zayde: The big goal of the Revenue Sharing Program is to make our team feel not only more invested in our success, but also give them a sense of ownership over the work they do. How it will work is: we have a set a budget of what our payroll costs will be, and should we beat that with higher revenue, the difference in that number will be distributed as bonuses to our bar team. I feel strongly that by building this into our payroll model, we will see better teamwork and effort to help the business succeed.
tLBCC: I’m not sure how it works at Bar Nine, but most baristas are part-time short term workers. Do you think this program is going to impact your hiring process or ultimately influence the caliber of people that apply for the job in the first place?
Zayde: We only have full time commitments at the moment, which is the way I’d prefer it. I think hospitality and work in coffee is as much of a craft as anything else, and should have the same opportunites to build a career that other fields do. I do think it will have some impact on hiring, as I think some people will be more attracted to this model than others, and our values are front and center by doing this. How our manager and I make a decision on someone will remain the same. Can this person execute amazing hospitality? Can they be willing to learn and grow individually and within our team? Can they contribute something new that will make us a better business? These are the questions we ask and some of the things we look for in evaluating a hire at Bar Nine.
tLBCC: Your move to eliminate tipping is part of your model of trying to “‘do business better.” Under this premise, you opened Bar Nine offering only reuseable/recyclable glass to-go cups instead of disposable paper products. What has your experience been in challenging the coffee industry to-go norm? How do you foresee your customers adapting to transacting without tips?
Zayde: I think whenever you do something new, you’ll meet a little resistance. That’s to be expected. But the thing we found with the glass-only to-go program, is that once people understood why we made that choice and the benefits of doing so, we’ve seen tremendous support and love for the program.
I think eliminating tips is a similar step that furthers our values in the way we want to operate our business. Ultimately it’s better for the employees, simpler for the guest, and creates more opportunities for a great experience coming into our coffee bar. We have of course been talking about this with our team and with our guests for a little while, and the response has been overwhelmingly positive at this stage. I’m looking forward to seeing it in practice! What’s important to note is the amount of money people will be paying really won’t be changing. Once people are aware of that, I think it will be received warmly.
tLBCC: To ensure a living wage for Bar Nine Employees, you are raising your prices. How much more should customers expect to pay per item?
Zayde: While we are raising prices, the amount people will be paying will actually be, in most cases, going down. On an individual item, our average tip is 85 cents and our average price increase will be 50 cents. The other key point here is that with wage increases across the country as well as locally, people are going to have to start adjusting their models of service and/or raise their prices. Since we’d probably have to adjust what we do in a few years anyway, why not do it now and take the opportunity to remove tips, something we wanted to do at our outset?
tLBCC: Since you are a roaster, and work in wholesale as well as service, is this move going to benefit the wages of Bar Nine employees that are not directly working on bar with customers?
Zayde: The wages will be remaining the same in our roasting and wholesale department as they are not directly affected by this, however we have similar systems in place there already when it comes to revenue and opportunities for growth.
tLBCC: Why do you think offering careers in hospitality is important for the coffee industry?
Zayde: I think it’s necessary to be able to achieve long-term viability, no matter the industry you’re in. We want to build a strong company culture that is built on taking care of our team, extending that to our guests, and building strong community. Not everyone has the right mind-set and ability to deliver great service and hospitality, while being able to do the juggling act of operating a coffee bar, while ensuring that quality meets the standard you want. It is a skill and it’s really enjoyable for the right person. I never enjoy seeing a great coffee professional who moves away from the work they love, just because it’s not viable for them to live on. If we can hold onto these gems and give them an opportunity to build their life through ensuring empathetic and wonderful guest experiences, I can’t think of a better thing to strengthen specialty coffee.