Less than three months into life as one of Canada’s first no-tipping restaurants, the Smoke ’n Water restaurant in Parksville has returned to the mainstream — tipping is back on the menu.
Owner David Jones said the restaurant has decided to scrap its no-tipping policy in favour of a traditional restaurant model as a result of customer demand.
“When we listen to our locals, the majority want to have a say in whether or not they tip on good service or poor service, on good food or bad food,” he said. “They want to have a say. … They feel like we have taken their freedom away.
“So at what point do you say we’re going to keep forcing this down your throat? Or do we say we are going to listen to you and respond in a way that’s positive to what the customer base chooses and wants.”
As a result, the restaurant switched Thursday to the traditional model and dropped menu prices, as well as staff wages.
When Jones, an admitted neophyte in the restaurant game, opened the no-tipping-allowed Smoke ’n Water on June 2, he established a menu with prices about 18 per cent higher than the norm and paid his staff a living wage — a business model that is accepted in many places overseas.
That meant the 155-seat restaurant paid servers between $20 and $24 an hour while cooks made close to $16 an hour when a monthly bonus structure based on gross sales was factored in.
Jones estimates servers will now be making about $20 an hour in tips plus the standard front-of-house minimum hourly wage, while cooks will remain fairly close to their existing wages and there will be tip-sharing between the two sides of the restaurant.
Jones still intends to offset medical and dental costs for his 36 staff.
He admitted he was sad to walk away from what he believed was a first step in changing how food service is done in Canada.
“The truth is we are two to five years ahead of the curve,” he said, adding he will revisit the idea at some point. “The staff really liked the concept, but you need to have your customers come with you on it.”
On top of local customers having trouble with the concept, the restaurant had to deal with soaring food prices. With a menu already pricing dishes higher than competing restaurants to fund higher wages, that meant hamburgers were listed at nearly $20 and tenderloin steak at $45.
“At some point, you price yourself out of the market,” Jones said.
He said customers will immediately see a new menu with lower food and liquor prices.
As for those who will say, “I told you so,” Jones said he won’t dwell on it.
Hospitality industry expert Frank Bourree of Chemistry Consulting, who was skeptical about the restaurant’s chances of success before it opened, was not surprised at the switch.
“The fundamentals of the business model just weren’t going to work from the point of view of customers, staff and certainly not the business owner,” he said. “I say, ‘Good try, it was an interesting experiment,’ but I think it’s way before its time in this current culture.”