Restaurateur plans tip-less fried-chicken restaurant
A local restaurateur is planning to open a tip-less fried-chicken restaurant.
Paul Lee, owner of The Winchester and Donkey Taqueria, announced his plans for the restaurant at last night’s Overheard at Start Garden.
The restaurant will be on Wealthy Street, near his other restaurants, in a still-to-be-announced location.
The menu will feature Southern-influenced items and from-scratch sides and be “unique” in the neighborhood, Lee said.
He hopes to open some time next spring or summer.
“The feel will be unique and fits that area well,” Lee said. “It will be a nice complement to Wealthy Street and the Uptown Neighborhood.”
What you see is what you pay
Lee said the restaurant will be ahead of the curve in Grand Rapids, moving to a model most of the world and several restaurants in major U.S. markets have already adopted.
“The restaurant industry is changing rapidly,” Lee said.
He said the restaurant industry has gone from a cash-based business to credit card, with nearly 90 percent of bills being paid by card. With cash, servers are required to report 8 percent to the IRS, and credit cards claim 100 percent.
“Being a server isn’t as lucrative as it appears,” Lee said. “That plays into our decision.”
Menu prices could be increased but so too would tips. That helps the server but not the kitchen staff, who Lee said is as important to the operation.
Instead, the menu will feature the price of an item with the gratuity added. The price seen on the menu will be on the bill, and there will be no line for tipping. He said this will level the pay for front- and back-house staff.
He did say servers will likely need some time to get used to not leaving the restaurant with cash in hand but waiting two weeks for a full paycheck. In the end, Lee said he expects servers to make about the same money.
“It’s easy for servers to remember great nights and forget the slower ones,” he said. “This levels it out, instead of making all the money on the weekends.”
Lee said there could be hiccups in the model.
He also said fears he's heard regarding a possible drop in service quality are warranted, because it's an unfamiliar and new model to consumers. But he's confident the doubts can be overcome.
Service, he said, is a reflection of how the operator hires and the system that is in place.
“Tokyo has the most Michelin Star restaurants in the world, and they don’t allow tipping,” he said. “And you don’t get bad service at Michelin Star restaurants.”
He said eventually the industry may dictate that restaurants switch over to the tip-less model, but until then, they will continue using the traditional American model.
“This is an experiment to see what direction the industry is moving,” Lee said. “We’re seeing it in bigger markets, and we’re just trying to get ahead of it in Grand Rapids.”