Money Matters

To Tip or Not to Tip

Here Candice Everest, owner of Panache Nail Studio in Stanwood, Wash., explains her decision to institute a no tipping policy — a decision that proved popular with clients. Jesse Bruner, owner of Jesse David Nail Design in Wilmington, Del., counters respectfully with why it wouldn’t work for him.

Recently we spotted an interesting series of exchanges on the BeautyTech.com forum and we thought we’d bring you some excerpts. Here Candice Everest, owner of Panache Nail Studio in Stanwood, Wash., explains her decision to institute a no tipping policy — a decision that proved popular with clients. Jesse Bruner, owner of Jesse David Nail Design in Wilmington, Del., counters respectfully with why it wouldn’t work for him.

You can read the entire thread at http://www.beautytech.com/forums/showthread.php?tid=3259.

 

Candice Everest:

“As of August 1, I no longer accept tips from my clients. In preparation, I started telling people about it as they came in for about a month — I didn’t post signs as I wanted to have open discussions with everyone as I went. This way I could get a feel for the response and could answer any questions.

I haven’t adjusted most of my prices since I first started three years ago, so I went back and updated the info on my service cost spreadsheets and adjusted all my prices upward. I raised most prices between 9%-14%, a few went up as much as 20%, because I found that the product costs and length of services warranted the increase.

This is just the highlights of the benefits, but it will give an idea of what I said to clients:

Benefits to client:

> No uncertainty of whether to tip (a salon owner) or how much to tip! Many people have expressed discomfort either before or after I told them about the policy change — and for the majority, this was a good customer service move.

> They get full loyalty points — my system won’t give points for tips.

> It’s a fixed cost. What you see is what you get.

Benefits to salon:

> No uncertainty. I can look at my calendar and know what I will be earning each day/week. (This is something that I didn’t really think about beforehand, and I was greatly surprised at the positive mental shift I experienced in my first week of the change.)

> All clients pay the same for every service. In my view clients who tip more are essentially paying a higher cost for the same product, so I was happy to even the field.

> If I hire an employee, all wages will be paid on the commission schedule. In Washington State we have to guarantee minimum wage, but we can’t count their tips as part of the minimum wage. Also, as an employer I would have to match social security wages on their tips (7.65%), pay insurance premiums on tips (6%), and possibly credit card fees on tips (2.25%) on money that never came in to the business.”

 

Jesse Bruner:

“I think it really depends on the type of business you run. To me, my price is for the nail service. If I just sat at my station and did nails or pedicures and if all my clients came to me with polish in their hand ready to go it would feel weird getting a tip.

But I do a lot extra for my clients. I personally greet all my own clients. I always get them a beverage. If it’s cold out, I take their jacket and hang it up for them when they arrive. I give advice and help them pick out a color. If they’re getting a pedicure I offer a neck wrap, roll their pants up, help them get settled.

I guess my prices are a bit of a dance. ‘I charge this because I know you’ll give me that.’ But I’m OK with that. And I don’t think my clients think less of me because they’re tipping me. They are being generous and I accept it and really appreciate it. I love reading the little notes they write on the envelopes.

And I have to say, I rent space in a hair salon with 25 hairdressers, who are all employees. I can’t even fathom the outrage if the salon owner came in and said, ‘We’re raising prices and you can no longer accept tips.’ I think it’s really going to be a tough sell for staff.”

Keywords:   tipping  



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