0:01

Good afternoon listeners and good afternoon

0:03

Bobby , and we're both delighted

0:06

that the sun is upon us .

0:08

I'd like to first of all say apologies

0:10

to anybody listening to this podcast in the morning

0:12

, because Jeremy's chosen

0:15

the afternoon because that's when we're recording it , but of course you

0:18

could listen to this podcast at any time .

0:20

Well , no , I would say . If you've started

0:22

, you must now press pause and

0:24

you have to wait till tomorrow afternoon

0:27

. If you're ahead .

0:28

No , I'm sorry . I think we must

0:31

allow our listeners to listen any time

0:33

to the podcast that they want to , and

0:36

not be so fascist

0:38

about timings .

0:39

Some people may have only just got up , so

0:41

instead of actually greeting them with good morning

0:43

, we could still say good afternoon and get away with it .

0:46

Well , that's true , but again we are alienating

0:49

anybody who's listening before 12 . Hmm

0:51

, bob

1:01

and Jeremy's Conflap the

1:10

Reality Podcast . Bob and Jeremy's Conflab

1:12

the reality podcast . So welcome to Bob and Jeremy's

1:15

Conflab . We

1:28

are going off in another direction today , but it does actually link back to some of the podcasts that we've done a little while ago on service and thinking

1:30

a bit about behaviors , and also we did some stuff about bad management

1:32

and there's a lot of subject matter flying around at the moment . I've just been listening to the today podcast

1:35

, all about economics , and there's a lot of stuff

1:37

there which is slightly depressing about

1:39

our aging population and what

1:41

have you and the cost of things and

1:43

very little wriggle room , and

1:45

that's within the economy as a

1:47

whole . So if you now bring that down to the

1:50

world of customer service in restaurants

1:52

and of course you could extend this

1:55

to barbers and taxes

1:57

and things like that as well there's a whole

1:59

new law coming in to

2:01

manage the way that we are

2:04

charged and in particular we're talking

2:06

about tips and service

2:08

charges and many of us will have seen at the bottom of

2:10

our bills 12.5%

2:13

service charge added

2:15

, and the new law

2:17

is coming in to right

2:19

a historic wrong and

2:21

I think it's probably fair to say , jeremy , that many

2:24

people didn't

2:31

realise that it was a wrong , did they ?

2:32

When you say they didn't realise it was a wrong , you mean the owners of the restaurants , the

2:34

owners of the establishments .

2:36

No , they knew it was a wrong , I think

2:40

customers made a huge assumption

2:42

that the service charges

2:44

would be split amongst

2:46

the staff .

2:47

Let's explain what it is . It's called the Employment

2:50

Allocation of Tips Act

2:52

2023 . So

2:55

the Act was raised , but it doesn't come into effect

2:57

. Till the 1st of July this year . We'll

3:00

make it unlawful for employers to withhold

3:02

tips from workers . The new

3:04

law will introduce a number of changes to tipping

3:07

practices in the UK and , if not

3:09

adhered to , could have substantial

3:11

financial consequences for employers , with

3:14

awards of up to 5,000

3:16

per employee to reflect losses

3:18

suffered . Now

3:20

it protects tips paid by cash and

3:22

cards . So I don't know if you're like Bob's

3:24

saying , consumers not realizing

3:27

this . I would often say to a waiter ooh , will

3:29

you get it if I put it on the card

3:31

? Do you need it in cash ? So

3:34

it ensures that tips are passed on to employees

3:36

without any deductions that's the point

3:38

from their employer and they should be allocated

3:41

fairly . And all workers are protected by the

3:43

new law , including those

3:45

on zero hour contracts . You know those

3:47

famous HR assassins who

3:49

come in and try and save companies money by

3:51

creating zero hour contracts . So

3:55

hotels , bars , restaurants

3:57

what you're actually going to have to do and this is

3:59

a I actually refer listeners to this

4:01

site very good law firm We've jumped on this called

4:03

Walker Morris walkermorriscouk

4:06

. They will help

4:08

you with the bit of the law that's tricky

4:11

. You have to create a

4:14

sort of distribution document if

4:17

you were checked , because it will also

4:19

be knocking on the door of employment and

4:21

immigration . If you're not doing that properly

4:23

, you see it could expose other things and

4:26

you have to fairly disperse your

4:28

tips and prove that you

4:30

have a proper disbursement policy . So that's

4:32

all the boring bit . To kick off

4:34

the podcast . I don't think we need to say any more about the law

4:36

. But July 2024

4:39

, bobby and I will be sitting in

4:41

a restaurant . We'll

4:43

have this is an imaginary world momentarily

4:45

would have received extraordinary service and

4:48

we'll want to tip the waiter waitress

4:50

and we'll have the full

4:52

confidence that he

4:54

, she , will be keeping that cash

4:56

or that cash will be going into a pool

4:59

for fair disbursement

5:01

.

5:02

Okay , so let's just go back to a fundamental

5:04

question . Really , why

5:06

do we have to tip ?

5:08

well , my research and I know you've done some

5:10

too doesn't really give

5:13

us that answer . I think the most

5:15

interesting research I have is from

5:18

germany and france . In the language

5:20

of tipping , so

5:22

in germany a tip is

5:24

called a trink geld and

5:28

, yeah , in french it's

5:30

a poor boy and

5:33

if you translate this it just means drinking money

5:35

. So trink geld

5:37

is a bit of geld for the , and

5:40

poor boy , boy , boisson boy . The verb

5:43

to drink . It's for you to have a drink , so

5:45

I give you a little bit of money and that means that

5:47

you can have a drink on me later

5:50

. So I think it's cultural that

5:52

we well , you worked in a pub

5:54

growing up . I'll have one later

5:56

. Let me buy the barman a drink . And that extended

5:59

as hospitality grew . This

6:01

is me imagining into rewarding

6:04

people with a little bit of something to

6:06

have a drink off , so I can't place it historic

6:08

.

6:08

So there's a lot of stuff online when you look

6:10

at this subject , which says that we're becoming

6:13

more and more americanized because , of

6:15

course , tipping is endemic across

6:17

america for so many things , uh

6:19

, to the point where it is actually assumptive

6:21

. Yeah , it's in no way

6:24

discretionary in america in certain places

6:26

. I remember the first time you and I went , jeremy , we

6:28

got to newark airport after

6:30

landing in new jersey and

6:33

a gentleman told us

6:35

what our fare was going to be to our

6:37

hotel , what the charges

6:39

were and what the tip was . They just added

6:41

it all together . There was no moment

6:43

where we were thinking we weren't going to be paying that tip

6:45

.

6:46

We had to pay that tip well , if listeners

6:48

don't know , the usa , canada

6:50

and columbia are right up in the higher

6:52

ranking . It's expected to be

6:54

15 to 20 percent

6:56

of your bill , so

6:59

that's like paying more than corporation tax

7:01

on your on your thing . So

7:03

15 to 20 percent , so that is

7:05

, as you just said , standardized

7:08

and what you're also calling about

7:10

this rocketing is nice little

7:12

word called tipflation so

7:14

it's the inflation of tips . There

7:17

was a survey carried out in the us . I

7:20

think you you used the word assumptive just then

7:22

yeah . Yeah , they asked US consumers

7:24

do

7:28

you think that tipping is an obligation or do you think it's a choice

7:30

? Well , 29%

7:33

believed it was an obligation . Okay , 21%

7:36

a choice . And that ridiculous thing the

7:38

other percentage went . Oh , it depends . But

7:40

what we're saying is most people in the US believe it's an obligation

7:43

that you pay it . They don't really

7:45

have the choice .

7:46

But you see , isn't that interesting ? 15 to 20%

7:48

. So let's say you've got a dish which

7:51

is $20 . Yeah , okay

7:54

. So let's say you know there's a plate

7:56

of food for $20 . You

7:58

could add $4

8:00

to that dish and have no tip . Okay

8:03

, and just say tips are included , just

8:06

make it $24 instead . Now

8:08

, psychologically then

8:10

the people think , well , it's quite expensive for that , but

8:13

actually when the bill comes

8:15

you're paying it anyway , so

8:17

why not just include it ? Now , that's a

8:19

big thing that I've been reading about is there's

8:21

now a movement in certain restaurants

8:24

to all inclusive . Everything

8:26

is included , gr gratuities . This is

8:28

not a tipping restaurant . I've been to one of those in America

8:31

. Actually , I haven't been to one in the UK yet .

8:33

I think , just coming in on that yeah , if you

8:35

were to have the dish for $20 and

8:37

let's say it's a fish dish or whatever it is , if

8:40

you thought that's not comparable

8:42

, that I'm paying $24 for

8:44

that fish dish in other places , the

8:46

challenge you'd have is you're marking up , you're trying

8:48

to get a $24 dish to

8:51

compete against $20 dishes .

8:52

But the point is that if

8:55

you signposted early doors in

8:58

this restaurant there are no gratuities

9:00

, Everything is included you

9:02

would expect to pay a little more for the food

9:04

, but you know there's not going to be a a 40

9:07

addition at the bottom of your bill . It's

9:09

a change in thinking . It is .

9:11

It's the same money yeah , but we're

9:13

a couple of brits speaking . If I said that to an american

9:15

, they might go . I think that would take a

9:17

while to change that behavior because I prefer

9:19

to know the fish is costing me 20 . It's up to me

9:21

to to reward the waitress .

9:23

But it isn't up to you because that service charge

9:25

is there . It's not up to you because

9:27

you're paying it anyway , and I think this is the odd

9:29

thing about it . Now , the difference is this , and

9:31

I think we've really got to make this point we

9:34

, as many other consumers

9:36

have thought , believe

9:38

that the service charge 10% , 15%

9:40

was the tip was

9:43

going to the waiting staff , was going to

9:45

the chef or whatever , and maybe

9:47

some of it was . But if actually it's

9:49

just an additional charge and I heard a guy being

9:51

interviewed about this the other day on a podcast and he said restaurants

9:54

only make money from wine and

9:56

service charges . The markup on food is tiny

9:58

and therefore they only make money from wine

10:01

and service charges Well , if that's the the

10:03

case , then they're going to have to

10:05

put their prices up because great , we've

10:07

got more prices going up great , brilliant

10:09

your service charge has to go to

10:11

your staff . Now , you have no choice

10:13

there . So if you're going to have a service charge

10:15

, you're going to have to give it to the staff . And

10:18

and as for the wine , well , I found out some

10:20

stats on wine . They make your hair curl . I mean it's absolutely

10:22

ridiculous what they charge . There is a whole

10:24

thing about this , because I've also

10:26

thought for a while if alcohol

10:29

is so hugely marked up

10:31

in restaurants , why do we tip against

10:34

it ?

10:35

well , because it's bundled in , isn't it ?

10:36

it's bundled in . You're already making a fortune

10:39

on that bottle of wine , so why

10:41

don't I just pay you a percentage

10:43

of the food cost as a service charge

10:45

?

10:45

Because , the bill is run up .

10:46

You've just opened yeah , but you've just opened a bottle

10:48

of wine which a child could do , yeah

10:51

. So you know , it's an interesting

10:53

. That's another perspective

10:55

on it .

10:55

Well , I think the other thing we should talk about right

10:58

at the outset , even though we're well into this

11:00

episode now , is , I

11:02

think I feel that I'm rewarding

11:05

good service with a tip absolutely right

11:07

or not rewarding with

11:09

no tip yeah , absolutely right

11:11

.

11:12

Yeah , and they're still being paid . By the way , they're still getting

11:14

the person just you're , you're serving

11:16

, you is being paid regardless

11:18

.

11:18

Well , let's talk about our experience . Just

11:20

the other night , which I think would bring it into focus . We

11:23

went to a curry house in lewis . Yep

11:25

, his service was nowhere

11:27

near as good as the buckingham fort

11:29

, no , and so therefore

11:32

, when we came to tip , I thought we've had to call you loads

11:34

of times and there's no one in here . You're late with

11:36

this , late with that . I didn't feel I wanted to tip

11:38

as much as I would do for another

11:40

curry experience I totally

11:42

agree .

11:43

So for the tip is saying

11:45

thank you for speediness , friendliness

11:47

, chat , whatever , recommendations

11:50

, knowledge , skill

11:53

, humour , all of those kind of

11:55

things which are part of the experience

11:57

, but that's why , when we got to know those

11:59

waiters in Princeton all those years ago , they

12:01

said to us that's why we know that

12:03

whenever the English come over , we know they never tip

12:06

because we think they're a bunch of tight asses . Well , they didn't

12:08

want our table , do you remember ?

12:09

No , it was only because we knew the girl

12:11

We'd met a girl from another place

12:13

who was friendly . She then talked to the waiter and said these

12:15

guys are friends of mine . Now they're fine

12:18

, but no one took our table of

12:20

Brits over there . Who wants them ? We're not going to get our 20%

12:22

out of there . There you go .

12:24

So , again , that's cultural , isn't it ? Yeah

12:26

, so , whereas you know , if we have amazing

12:28

service and

12:34

actually in America the service is by and large way better than we get over

12:36

here so of course you're going to reward it in some form , which again

12:38

is an odd one , why do we actually do that ? But then

12:41

over here , almost

12:43

automatically in the last 15 years

12:45

, the service charge comes in 10%

12:47

, 12.5% , 15% , they're

12:49

going up , and

12:52

one chain in London have

12:54

brought in to circumvent this new

12:57

law . They brought in a thing called

12:59

a brand charge , which is 15%

13:01

, already brought it in , which

13:07

is already percent , already brought it in , and that will be . And

13:09

they're being criticized for that , because they're being explicit that this

13:11

is an additional charge on top of your food , which is not

13:13

a tip . So you're being charged this

13:16

service charge and it's

13:18

it's just a charge for you , for you

13:20

to be , to actually be there , and

13:23

I suppose if you want to tip , you have to either

13:26

tip someone directly you know , have more fascinating

13:28

the marketing director there , using

13:31

the word brand charge , young people

13:33

could brand .

13:33

It's a good brand you know I'm part of , I mean outrageous

13:36

.

13:36

I'm at the behest of the brand I've experienced

13:39

the brand . Yeah , oh , that makes

13:41

my stomach go a little , I think well , again

13:43

, what you're doing is you are blatantly saying

13:46

there is an additional charge

13:48

for you to eat here because

13:50

business rates are high , employment

13:53

costs , electricity , power , energy

13:55

is high . To run a restaurant of any type

13:57

these days is extremely expensive

13:59

and , rather

14:01

than it being an additional income stream , actually

14:04

for some it will be . I think

14:06

for many it is a lifeline , and

14:09

there's a huge amount of concern

14:11

that this is going to drive many restaurants

14:13

out of business and pubs and

14:15

others who are already struggling

14:19

.

14:19

Thompson was quite vociferous

14:21

. This will be going back 20 years

14:24

. In one of the other roundups

14:26

of minimum wage increase he was

14:28

arguing against the minimum wage increase

14:31

across his restaurants because he was saying I

14:34

can't afford to pay any more to

14:36

my waiters and bar staff and

14:38

bus boys and so on , and

14:40

if they're prepared to do the job for that , I

14:42

throw in some other stuff . They all get fed such

14:45

and such . I don't really want to pay them

14:47

anymore . And he was quite

14:49

strong in saying that the amount of money they're already

14:51

receiving is enough

14:54

for that . Yeah , extraordinary

14:56

, isn't it ? Temporary period of time and so

14:58

on .

14:59

Well , at the same time , there

15:01

is a question mark over . You

15:03

do these jobs . Why ? Because you're good

15:06

in front of people , you enjoy it , you enjoy

15:08

the interaction , you get

15:10

something out of it , you're motivated to do

15:12

it . In many cases in

15:14

other sorts of establishment

15:16

, you do the job because there's nothing else you have to do

15:18

it , you're on the lowest hourly

15:21

rate and any tips you

15:23

get on top make up your

15:25

poor hourly rate to a slightly better hourly

15:27

rate . That's what we're talking about here and that's

15:29

where I think , at the lower end , this

15:32

is really , really dodgy , because I

15:34

think what's going to happen is that you've got people

15:37

who are paid , you know , £8.50

15:39

, £9 an hour maybe , and if they're

15:41

under 21 , by the way , or under

15:43

18 even then it's even

15:45

lower . So there are very , very low rates

15:47

of pay , and that additional

15:50

tippage might

15:53

give you an extra pound or two an hour .

15:55

We're saying that's vital , but you're also saying

15:57

some of those jobs may be lost

15:59

. Oh yeah , Because the restaurant can't

16:01

carry the additional loss of

16:03

income .

16:05

I can't see how they can . Yeah , Now it's interesting

16:07

. There's a restaurant opened in Lewis recently

16:09

. I haven't been in there yet . It's a very nice looking

16:11

restaurant with some amazing wines

16:14

in the window . They've got a beautiful shelf

16:16

of wine and I'm sorely

16:18

tempted to go in there . However

16:21

, I've done some research today on

16:23

wine in restaurants and

16:25

the percentages . You

16:27

just think I can't see how they can

16:29

justify it really . Let me ask you

16:31

this question what do you think the average markup

16:34

is in percentage terms against

16:36

the retail cost of a bottle of wine

16:38

in a restaurant ? 46% , Okay

16:41

, If it was that low , you'd

16:44

be out of business in a few days I've

16:46

gone high . Okay , the average

16:49

markup on a bottle of wine against

16:51

retail is 300%

16:53

, so

16:55

a tenner bottle of wine will

16:57

be 30 quid . Okay , on

17:00

average .

17:01

God , aren't I naive .

17:02

There we go .

17:03

I'd sell that for 15 quid . No , no

17:05

chance , Okay there you go .

17:06

Now it's even worse . Just to make you realize

17:09

that of course the

17:11

£10 is the retail price . If

17:14

I'm buying in bulk , I'm

17:16

going to get it for six or seven , Okay

17:18

. So I'm making even more on that bottle

17:20

. And I read about one chap who had

17:23

varied wines in his place , but

17:28

everyone asked for marlborough , new zealand , sauvignon blanc . Sauvignon blanc

17:30

, sauvignon blanc . Okay . He found a bulk supplier

17:33

who could give him a bottle of four

17:35

dollars , okay , and he was

17:37

selling it for 50 nice now

17:40

that's a huge markup

17:42

and he said he had other wines that were better value

17:45

, nicer , uh , lower markup

17:47

, but people just wanted the new zealand

17:50

, and it was just and and fifty dollars

17:52

. What the hell ? They were just doing it and he was making a fortune

17:54

. Now let's think about that

17:56

as a single premise , that

17:58

you're making 300 on your wine

18:00

. Okay , and actually

18:03

so for me to give you 15 on that

18:05

. 30 quid , that's

18:07

another four pound , 50 on top , you've

18:09

just made 215

18:12

percent yeah , it says 315 percent

18:15

for a single bottle of wine yeah , that's

18:17

ludicrous why are we tipping the wine

18:19

? I don't get that .

18:20

I just don't get I I don't , I

18:23

don't know we where we've had these arguments

18:25

before . I remember during the pandemic

18:27

, when restaurants were closing , everyone looked at the

18:30

large owners of shopping

18:32

centers who were renting to Strada

18:34

and Jamie's Italian and all

18:36

that kind of mid-range market

18:38

, yeah , yeah , and how they were shutting

18:40

down like nobody's business . Well

18:43

, they were relying on quite

18:45

healthy numbers of people adding it into

18:47

their shopping experience mid-market

18:49

, mid-range , but british

18:51

land and all the people who own these kind of buildings

18:54

were still charging pretty

18:56

healthy rental sums and

18:59

the whole thing just ticked along it . It

19:01

worked , so the

19:04

markups were good . So I don't fully

19:06

back and believe when

19:08

they all say they're going to go bust with this . I

19:11

think I think there's . I think there's

19:13

a pyramid involved . Reality

19:20

Training was created in 2001

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19:24

who met at drama school . In

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contact us via realitytrainingcom

19:49

.

19:51

Let's imagine that you have got one of these big restaurants

19:53

in a nice position , maybe in an airport , and

19:56

let's imagine it turns over a million a year and

19:58

some of them will turn over way more than that . Yeah

20:00

, okay . So a million a year , you've

20:02

got your 12.5% on top . That's

20:07

£120,000 in service charges on that million turnover . Okay , that's

20:10

essentially free money . Okay

20:12

, so you've got all the costs you've just been talking about

20:14

, all your rates , all your staffing costs

20:16

, etc , etc . But you've got 120

20:19

a year cash injection

20:21

simply from transactions

20:24

. That's just free money essentially

20:26

. And people already paid the markup on the booze They've

20:29

already made . You've made some money on the food , it's

20:31

you know . In that sense it's

20:33

a huge amount of money . And then you go into

20:35

a chain who are turning over 10 million

20:37

. Then 1.2 million a year

20:40

is in service charge money , 1.2

20:42

million just in credit card transactions .

20:44

Okay , it's mad money

20:50

1.2 million just in credit card transactions . Okay , it's mad . So , interestingly enough

20:52

, the chains that have multiple investors wanting their money back

20:54

don't

20:56

own their own buildings . This

20:58

seems possibly more vital to

21:00

a family-owned mortgage-free

21:03

yeah . So

21:06

there might be some independents that

21:08

come through this quite nicely and

21:11

some of the chains that had well , I don't know , it's going to be very

21:13

interesting . I think one thing that's going to bound to happen

21:15

is they've already got the percentage on the booze that can't

21:17

move too much , but they're all going to mark the food up . The

21:19

food's going to rocket , the food's going to have to go up , but

21:33

then , in which case , less people will go , then you create you're in the same pressure

21:35

on the sector . Yeah , it's poor historically . When I worked at cafe bohem there , was no minimum wage

21:38

law . I kept all of the tips , so that's one thing he did do is we kept every red cent

21:40

of it , but it was all cash .

21:41

It was a cash economy oh , I agree , and I

21:43

was the same . When I worked at the swan in

21:45

tunbridge wells , I used to do

21:47

saturday nights in the hotel bar . It

21:49

was very faulty towers , you know , and

21:52

I was , you know , bowtied up and , uh

21:54

, you know , all the usual bum flufferies and

21:57

I was often handed cash

22:00

tips from people who I was serving . All

22:02

I was doing was serving them drinks . It wasn't a cocktail

22:04

bar , it was no , you know , it was no skin

22:07

off my nose , I was was being paid anyway , but

22:09

there was a feeling that they wanted

22:11

to reward my joie de vivre

22:13

with a few quid , and

22:15

I was delighted to accept it , of course . But

22:18

again , I think we've really got to

22:20

make a distinction between personal reward

22:22

. Here's a lovely guy get you a , a drink . Back to your

22:24

original point now , of course , when

22:27

I worked in pubs and you worked in pubs , if somebody

22:29

bought you a drink and they were buying around , you

22:31

could have it yeah , okay , so

22:33

I'll have a half with you . Don't mind if I do yeah

22:35

, that's or you know now , these days nobody drinks

22:37

behind the bar , which I think is absurd yeah

22:40

and so you , you take the money

22:42

, do you .

22:43

How does that get ? You're not meant to ?

22:44

you're not meant to .

22:45

You're meant to run the money you're meant to run

22:47

the money through the till . Let the owner make

22:49

the profit margin on the beer and you pour the beer

22:51

it's extraordinary , isn't it ?

22:53

have it at the end of your shift . My grandfather

22:55

, joe morel , the late

22:57

great joe morel . He worked in a series

22:59

of pubs around clark and well , and

23:02

whenever he was bought a drink he

23:04

would take the money and put it in a

23:06

little pot .

23:07

It was a tip .

23:07

That's great okay now again , that's a personal

23:10

thing and I think many

23:12

of our listeners will think well , okay , if

23:14

I go to a barber's , if I get a taxi

23:16

and the guy's efficient and quick

23:19

and a good laugh and whatever personal reward

23:21

, yep , I'll physically reward

23:23

this person in some way with

23:25

some money . But I think this

23:27

idea of now the way the service

23:29

charge has come in , I

23:36

think what it's done is actually it's now biting back at the people who brought it in to use

23:38

it as a revenue stream , because

23:40

they're now thinking hang on a minute , oh

23:42

no , I've got to give all of this to the staff . So

23:45

maybe if they worked on it in a slightly other way

23:47

, they might have had a halfway house or

23:49

called it tips , for your server actually

23:52

called it that on the on the thing that might have made a

23:54

massive difference . Service charge

23:56

sounds like really what

23:58

on top of everything ? You want me to pay this on

24:00

top and I will never forget . I

24:02

won't . We won't say where this is . We

24:05

went for a Christmas party once to a very

24:07

, very top restaurant and

24:09

it should have been wonderful and

24:12

the service was average to

24:14

poor . There was a huge service

24:17

charge and this was a couple

24:19

of weeks before Christmas and

24:21

they wanted us out before 9.30

24:23

so they could give the table to somebody else . Now

24:26

do you really think I'm going to give that

24:28

brand a tip and

24:30

be happy about paying their service charge when

24:32

actually the service is appalling

24:35

and they're hurrying us along ? That's

24:38

outrageous . That's absolutely

24:40

outrageous . And what happens is this you just

24:42

don't go back .

24:43

Well , that's right , you just vote with your feet . I

24:45

mean , there's some we're a country that has this

24:47

sort of odd relationship with that . The us

24:49

are much further down the road of sort of obliged

24:52

brazil , chile , around

24:55

10 . The netherlands publish

24:57

it all , so it's all in print saying exactly

24:59

what's going to happen . So you know , japan

25:03

, none of this , there's none of this . It's

25:05

all part of the game . There's

25:07

no culture . It the price is

25:09

the price . That's where it is . Iran if

25:11

you really have been charmed , you leave a gift for

25:13

the person who served you , you

25:16

don't ? It's nothing about money . What a little , a little

25:18

trinket . I don't know whatever key

25:21

rings you notice they didn't have one . I

25:24

think the wider debate that appeals to me is

25:26

if you are wanting to

25:28

earn money by being brilliant

25:31

in customer service . Restaurants

25:33

have been a fantastic ground for you to go

25:35

into , because you know you get food . You , you can be a low income but

25:37

work your way up , and then then you're you get food . You , you can be a low income but work

25:39

your way up , and then then you're in hospitality and then

25:41

you're managing people and so on , so on . If they

25:43

don't get this right , this will be another sort of

25:45

point of journey into work

25:48

being cut off or

26:00

reduced .

26:01

Yes , I is an interesting one because and

26:05

then you structure your menu so there's no tips and

26:07

no service charge , it's just decide

26:09

on the pricing . I was just thinking

26:12

back to years ago . There were two

26:14

restaurants I liked , one in london , one in bristol that

26:17

were Italian and

26:19

every server in that place

26:22

was way over 50 . Okay

26:25

, and male they were all male

26:27

and the

26:29

service was just off the

26:31

charts friendly , funny

26:33

, quick , efficient

26:35

, knew all about the dishes , personality

26:39

and charm , you know , just fantastic

26:41

. Now , in that kind

26:43

of scenario , of course they

26:45

would have benefited from tips and service charges , I'm sure

26:47

. But I wonder whether when

26:50

that's your full time job , you're a pro . You've

26:52

been doing it for 20 or 30 years . Of

26:55

course you're on a salary . You're already

26:57

on a salary , you're on a salary per year

26:59

. The standard of your service is not

27:01

going to deviate . You're always going to be brilliant

27:03

and people are going to go to that restaurant

27:05

because of you . Absolutely

27:07

Not much emphasis is put on that . That

27:10

you know if you've got a really good server . People

27:13

come back every week . Let's go and see

27:15

that lovely guy you know , which is actually brilliantly lampooned

27:17

in the league of gentlemen when

27:19

this couple who are unhappy . Go

27:22

to see an italian restaurant with luigi

27:24

because he lifts their spirits

27:27

they're so depressed until he comes in luigi

27:29

, luigi , and then it turns out his name isn't luigi , but

27:32

wonderful , you know , that's the point that

27:34

if you've got a really

27:36

, really good level of service , then

27:39

you are the custom is going to be , then the custom is

27:41

going to be such , your regular custom is going

27:43

to be such . And come back to Indian restaurants

27:45

. We go back to the same Indian restaurants

27:47

when the service is amazing all

27:49

the time , because that's the reason , that's

27:52

how they absolutely lock in their

27:54

revenues and they lock in their longevity , because

27:57

they're absolutely brilliant . And I think we

27:59

have a real disconnect between

28:01

those two things with this service charge , with

28:03

this new law that actually , if

28:07

your service is poor , now

28:09

this law has come in , everybody is

28:11

going to be way much more conscious and

28:13

I hope that the places that are brilliant

28:16

and have great people , people

28:19

flock to them because that's

28:21

going to make everyone work harder .

28:23

You talked about the top restaurants that have

28:26

employed waiters permanently . Maybe

28:28

the kind of casual relationship

28:31

with staff will change and

28:34

they'll say look , we want to make a commitment

28:36

to you . If you make a commitment to us , maybe you'll have more

28:38

places deciding that actually

28:40

just being brilliant . Having the volume of customers

28:43

is now going to be more important than the tip . There's

28:45

going to be such a sort of spotlight held over

28:47

this tipping principle . Right

28:49

, let's do , let's do . Three is the magic number

28:51

.

28:51

Three is the magic so

29:00

nice , easy one .

29:01

What's the best customer

29:03

service you've ever had when

29:05

it comes to bars , restaurants , hospitality

29:08

?

29:08

I think I've mentioned this before , but it was in

29:10

new york . It was in the

29:13

grammer sea tavern , which

29:15

is not a low-cost restaurant

29:18

. We went in . All

29:20

of the servers are women of a certain

29:23

age , all wearing beautiful outfits

29:25

and their knowledge

29:27

of each individual cocktail

29:29

, each individual dish . The

29:31

best way to go through the menu is just

29:34

amazing and you have an

29:36

amazing meal . And then the bill comes

29:38

at the end . This is not a

29:40

tipping restaurant . Our service

29:42

is included . We hope you had a wonderful time . They

29:44

do not want to tip . Now

29:49

, that was shocking because it was in America , but it was also a great

29:51

example of exemplary service

29:54

that wasn't hustling for

29:56

tips . They were just that good because

29:58

they chose to be . And

30:01

my question to you is what is the best customer service you've

30:03

had ?

30:04

I think I possibly am in California

30:07

and it's two summers ago and

30:09

I wish I could remember the place . It was

30:11

a California town , a

30:14

traditional US restaurant . We looked , we

30:16

didn't understand the menu in any way and

30:18

the prices were very high to us as

30:20

UK foreign travelers . And

30:23

this woman in her 60s

30:25

came over and just said oh

30:27

, it looks complex . Start

30:29

small , work your way through it . Don't

30:32

don't order as you go . Our chefs

30:34

are quick , don't worry about spending

30:36

a fortune on these mouths because you don't know the portion

30:38

sizes . You , you just start

30:41

small and we'll work . And it was like took all

30:43

the pressure off and we tasted

30:45

different things and then some kids were more hungry than

30:47

others and we added dishes as we went , which

30:49

was a really nice way . Rather than what's your starter

30:51

, what's your main , what's your put , lock it in . It

30:54

was just come and go as you please that that

30:56

was . That's the most recent good experience

30:58

, and I will try and find out what the place was called yeah

31:00

so worst service for you .

31:03

Well , my question to you is similar . Is it ? Can

31:05

you remember a time when you didn't

31:07

tip because the service was so bad ? So

31:10

that's a slightly different question . I've had lots of

31:12

bad service , but I'm just thinking

31:14

about a time where it was so particularly

31:16

poor that we you

31:18

or I , or whatever we didn't feel

31:20

a tip was was warranted , didn't think it was

31:22

was worth I know one with tash

31:25

when we were on holiday

31:27

in torquay .

31:28

I ordered the lemon chicken and there was no lemon

31:30

in it . It was just a dry piece

31:33

of chicken . I said there's no lemon , is there some lemon ? It's a

31:35

lemon chicken dish . And he went . Other people

31:37

have had it and they haven't complained .

31:39

So we didn't give him a tip no

31:42

, have you ever , on that

31:44

, removed a service charge before

31:47

paying the bill ?

31:47

possibly not just being too bloody english

31:50

and what you just said earlier just

31:52

crossing it off the list and not going there again

31:54

I'm sure that's the more default

31:56

habit for a bit disgruntled

31:58

off we go . We're not going back there again .

32:01

I can't remember a time where I I

32:04

don't think I've ever done that , but

32:06

I'm just trying to think of a time that

32:08

there have been times when I've been away on

32:10

business where the service

32:13

has been average or below

32:15

average and I haven't tipped because

32:17

I just think no you

32:22

know , please give me , me something to to reward

32:24

you if there's nothing to reward , yeah , vacant .

32:25

Looking around doing the Michael winner thing , waving

32:28

the napkin yeah , yeah

32:31

, exactly .

32:32

It's funny . My son , charlie , has just recently

32:35

started a job serving at a wedding

32:37

venue , and I'm

32:39

not sure what the tipping scenario is there

32:41

, but he says

32:43

what's quite interesting is that people

32:46

, when they see you behind the bar

32:48

or they see you serving something , they

32:50

naturally feel slightly sorry for you

32:52

, and I don't know whether this is part

32:54

of the deal . People go , oh , look , this poor

32:57

guy's having to work behind there .

33:00

He must be poor , he must be struggling

33:02

a bit and actually I

33:04

think there is a bit of that there was . There's a hotel

33:06

in buckingham that's now part of the buckingham university

33:08

. I don't know if you know this . You remember that thing called buckingham

33:10

beals on the roundabout

33:12

. It then became a best western . Do

33:15

you know the one I mean ? Out on the roundabout that's

33:18

?

33:18

now part of Buckingham University campus .

33:19

But there was a guy who worked behind that bar there

33:22

who , when you looked into his eyes

33:24

, you felt you shouldn't have ended up doing

33:26

this . And so you feel slightly and

33:29

he had sort of no busyness and he'd

33:31

take ages to pour a pint because he

33:33

had ages and it was a bit depressing

33:36

and you thought where's he scuttling back

33:38

to ? There is something about that

33:40

. You shouldn't have to be doing this .

33:42

No , my

33:46

third question we've actually talked about is I was going to ask you whether you

33:48

remembered when we had to play an assumed tip , and that was

33:51

, of course , in America . When we first

33:53

went there , we were told what the tip

33:55

was that we were going to be paying . That was

33:57

so bizarre . Yeah , can you

33:59

remember another time when you've had to pay

34:01

someone

34:03

?

34:03

said , oh , and with the tip ? Yeah , that's again a Californian trip with

34:05

Tash and the kids in a pizza place . We

34:08

paid the bill and we didn't tip because we were

34:10

just rushing . And we were called

34:12

back in with a manager having a conversation

34:15

with us saying Chelsea's been your

34:17

server . You really need to give her 20

34:19

. That's how it works here and as brits

34:21

you may not understand this . I'm going to take you through

34:23

it and I need you to cough up and give her some money

34:25

. She ran out for us and brought us back

34:28

into the restaurant to tip yeah

34:30

, I've never heard about . Yeah , that was extraordinary

34:32

and she was folding napkins , scowling

34:35

in a sort of ante room and

34:37

we sort of looked at her and she sort of looked back at

34:39

us and was sort of doing that face

34:41

like oh , and

34:43

the manager was saying , look , look at Chelsea , she's

34:45

over there . You haven't tipped her . And I went

34:48

. What she said let me explain to you , because you Brits just

34:50

don't get this . And Tash and I go what ? How

34:52

much was the bill ? She

35:00

wanted us to put down another 40 quid . And we were talking and we went we're not doing that

35:02

when it's chelsea's been off and hardly attentive and these have been pizzas that have

35:04

already , you know , a pete . That pizza was 29 and

35:06

then well that's what it is

35:08

here in this part of burbank or wherever we were , and

35:11

I remember us just

35:13

leaving ten dollars or something

35:16

and walking out and her going unbelievable

35:18

and chelsea coming back in as we look back through the windows

35:20

, chelsea and the manager talking , and I just thought your

35:22

service has been desperately average . Why

35:24

should I tip you ?

35:26

god , I mean there's a whole drama , right

35:28

there , you can imagine Chelsea's face , can't

35:30

you ? Yeah , absolutely . I mean

35:32

, I made sure to face like a smack backside .

35:34

Yeah , absolutely so my last question to you

35:36

is you're running a four

35:39

site restaurant group . You're

35:42

the owner of it . You and your

35:44

fellow director have just got this news . You're

35:46

not very big , but you're quite ambitious . You may be in

35:48

your forties and this little restaurant

35:50

business of yours , what are you going to do ? What are you going

35:52

to talk to your staff ? What's your plan to

35:54

deal ?

35:55

with this . It's a really good question . I I

35:57

think maybe maybe

36:00

we re-institute

36:03

something which you you don't see

36:05

in many restaurants these days you get managers

36:07

and things like that . I think

36:09

if you had a permanent head

36:11

waiter or permanent head assistant

36:14

head waiter who salaried people

36:16

who were there most of the time , then

36:19

you would have an exemplar to

36:22

use that awful word a fantastic

36:24

service that would in

36:26

each place , would carry

36:28

a higher salary cost but would absolutely

36:31

show the standard . Then you could

36:33

have however many waiting staff you need to

36:36

run the evening , who

36:38

will be on an hourly rate , but

36:40

I think you you absolutely

36:43

make sure that the head waiter and the assistant

36:45

okay are running the service

36:47

level so that you , as a restaurant

36:49

, keep getting customers , because now you're losing

36:51

your tips yes , yeah , correct

36:53

, and actually it shows

36:56

that you've got to .

36:56

Then I

36:59

up . I'm with you on that . I think I would do

37:01

nothing with my prices . I would prove

37:03

that we're good and that we're happy

37:05

to go along with the law because it's a law and

37:08

that everyone's going to keep their tips . We're not going to get

37:10

it , and because we're so good , I would then be

37:12

able to inflate my prices in due course

37:14

.

37:15

And actually the other thing I was thinking . There

37:17

are certain restaurants . Nothing

37:19

happens before 7 , 7.30

37:21

. And then at 9.30 , the chef's

37:23

gone , I think you and . I have , you

37:26

know , traveled and got to places

37:28

and turned up at restaurants . We've missed the chef

37:30

and it's , you know , chicken salad

37:32

or something . And

37:40

I think maybe there's something about extending the hours slightly that you're open

37:43

, because that's , you know , means you get a bit more passing trade . But

37:45

regardless of solutions , I think this new law over

37:47

the next two or three years is going to shake

37:50

out a lot of poor

37:52

service restaurants and pubs

37:54

and I don't think there's anything

37:56

that's going to change that .

37:57

It's a very interesting thing . So , instead

38:00

of us giving you tips , today it's been

38:02

more about tips .

38:04

One other thing I was going to mention just

38:06

very quickly . If

38:08

you ring a contact center and the person

38:10

you speak to is amazing , wouldn't

38:12

it be lovely if you could just say , yeah , I'm going to give

38:14

you an extra fiver ? That's very funny , really

38:16

. Yeah , we

38:19

don't do that that , but the guy's incredible . I , I

38:21

could buy something for 50 quid . I , I could easily

38:24

spend that on a , on a meal somewhere . Why

38:26

can't I ? Why can't I tip the guy fiver on the phone . Interesting

38:29

, isn't it ? That's funny . There we are . Think

38:31

about that . Thanks for tuning in . Cheers

38:34

, bobby . Thanks guys , bye . Thanks

38:39

guys , bye .