Business

No-tipping concept aims to ‘shake it up’ at Nanoose Bay restaurant

The Smoke
The Smoke 'n Water Restaurant at Pacific Shores Resort in Nanoose Bay opens June 2 and purports to be the first no-tipping restaurant in Canada. Above, on the restaurant’s deck, are manager Joe Smith, left, and owner David Jones.
— image credit: JOHN HARDING PHOTO

David Jones believes he will shake up the hospitality industry when his no-tipping restaurant opens next month at Pacific Shores Resort in Nanoose Bay.

The price you see on the menu is the price you will pay — plus appropriate taxes — when the Smoke 'n Water restaurant opens to the public on June 2.

"This is going to create a social change," Jones said last week while renovations continued on the restaurant. "We are shaking it up. Why do we believe that by tipping someone we are going to get better service?"

A newcomer to the restaurant industry, Jones grew up in Southern California but has spent the last 15 years in Oklahoma. He said he was looking for a business opportunity last fall when he saw an advertisement on an website. He had visited Pacific Shore last summer.

"There it was, a turn-key lease," said Jones. He signed deal in April and on May 1 work started, led by lead contractor Ken Burke and interior designer Alice Munro.

Jones said he and his restaurant manager Joe Smith have had no trouble getting staff for the restaurant.

"Not one of them has even hesitated when we explained how we are going to do it," said Jones. "It (the no-tipping plan) takes away from the 'me' concept and puts it back into a team, which includes the back of the house (cooks)."

In general terms, this is how Jones said it will work. He said he will pay his staff $10.50/hour. At the end of each month, the staff will split 15 per cent of the restaurant's revenues, receiving a lump sum, pro-rated to how many hours each staff member works. That will likely push most hourly wages at Smoke and Water to more than $20/hour.

Jones also said a percentage of revenues will go to staff health and dental plans and a social fund, which the staff can decide to donate to any cause or charity. He said staff will sign confidentiality agreements and be able to see the actual revenues of the restaurant each month. He believes this model will also allow his staff to seek financing for homes or cars like people in other industries can do, because all their income will be on paper.

"I'm going to treat these people (staff) as adults," said Jones.

Smith, the manager, said he doesn't believe Parksville Qualicum Beach hospitality businesses are in tune with their visitors from places that already have no-tipping restaurants like parts of Europe, Australia, Japan and New Zealand.

"I think that the service industry here, compared to other places I've been, is not catered to the tourists who are coming here." said Smith. "They (tourists from those countries that have done away with gratuities) don't understand the tipping culture."

What does his new staff think of this?

"Their excitement level is through the roof," said Smith.

Jones conceded he expects push-back and skepticism about his plan from other restaurants in Parksville Qualicum Beach.

"This (tipping) is a broke system, a broken business model," said Jones. "I hope they (other restaurant owners) look themselves in the mirror. I hope I shake them up. I don't have any loyalties to anyone other than our staff."

One industry insider isn't so sure this will shake up the local restaurant scene.

"You're forcing the customer to tip regardless of how good the service is," said the local insider. "I understand what he's trying to do. They've had no success doing it the standard way out there so he's going to try something new. Unless he is going to pay a significantly higher wage, he's going to get the bottom of the barrel (for staff), a lot of rookies who have little or no experience. And are they going to have to charge $19 for a hamburger?"

Jones said his menu prices will be "fair." Jones was also asked what would happen if a customer does leave a tip.

"We're going to chase you down and give it back to you," he said. "If we can't find you, we will donate it to charity."

Smoke 'n Water Restaurant in Pacific Shore Resort opens to the public on June 2.

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