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July 8, 2016 Staff

Should You Accept Cash Tips on Your Food Truck?

jar

It can feel like just about anywhere you shop now-a-days, you find a tip jar. Historically, people would tip their server a customary 10% at a sit-down restaurant or for services like a ride in a taxi. Today, you’ll find find the tip jar front and center ever where from coffee shop chains like Starbucks to Subway restaurants. Which leads us to the question… With the continued acceptance and expectation of a tip jar, why not accept tips on your food truck as well?

According to TripAdvisor.com’s Tipping Etiquette guide for the United States, a “good tip” should be 20% of the total bill for a server at a restaurant, with exceptional service being compensated at 25%. Of course there is much debate over what represents a good tip and who should receive them.

cash-tipThe Case For Accepting Tips on Your Truck

From an income standpoint, adding a tip jar will increase your overall profits. There is no cost to adding a tip jar so all of that additional income goes straight to the bottom line. If you do not need to hire employees to operate the vehicle, you get to keep 100% of the tips as well. If you do have employees, tips can be a nice incentive to provide great customer service and help retain staff since they will ultimately make more.

The other interesting thing is that many customers will expect to tip you when dining at your truck or trailer. This makes sense because you are operating a restaurant on wheels. You shouldn’t expect to receive a whopping 20% on average that some etiquette guide recommends, but even a smaller percentage can lead to notable profits over the course of a year.

On the conservative side, imagine that you were able to collect a 5% tip on average from each customer bill. This is a very realistic expectation if the collection jar is located in a prominent area on the truck (there are also some POS systems that allow you to include tips within a special field of their payment system). To keep the math simple, if you did only $100,000 in total sales over the course of an entire year, you would get around $5,000 in tipped wages over that 12 month period. Keep in mind this is all income that you didn’t have any expenses for.

A Couple Things to Keep in Mind With Tipping

If you do decide to accept tips on your truck, you should not make customer tips an expectation among employees or for yourself. One horror story that became a popular story back in 2013 was of an employee that shamed a customer on Twitter for not tipping after making a $170 order off of the truck. This is the kind of entitlement employee culture you do not want on your food truck and could cost you future business.

Finally, you do not want to make customers feel like they need to tip. The goal of your food truck should be to leave customers feeling happy and satisfied, not feeling bad because they didn’t leave a big enough tip for your employees.

Do you think that food trucks should accept tips? We’d love to read your thoughts in the comments section below. 

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