Better Service, Better Tips: The Traditional Tip-Out Model Still Works

While service charges and automatic gratuities have become more common in recent years, especially since Covid, most restaurants across the country still have a standard tipping model, in which guests leave gratuity based on the service experience they had. With the more traditional tip model, some operators have tip pools, for front-of-house staff, or front-of-house and back-of-house. And others employ a tip-out system, where servers share a portion of their tips with other front-of-house team members. 

In the second installment of our tipping series, Full Book spoke with Emma Elmes, regional director for The Henry and Blanco, two of the concepts under the Fox Restaurant Concepts (FRC) umbrella, who oversees restaurants in Arizona, California, Tennessee, and Texas. For FRC and Elmes, the tip-out model ensures the highest level of service and hospitality that they expect from their teams. 

How does Fox Restaurant Concepts structure its gratuity policy?

At FRC, we want tipping to be discretionary for the guest, so we use a regular tip-out model. When we do menu roll-outs, we do year over year price increases, to cover the cost of doing business and food and drink, but that’s all rolled in. We still want to provide an excellent service, and allowing our guests to be able to tip based off of service and not just a blanket add-on is how we want to do business. 

The tip-out model is different in each store depending on the food versus beverage sales. For example, the bar tip-out at some restaurants might be 2 percent of total sales but at other restaurants it might be 6 percent just of beverage sales. So we tailor it depending on sales volume of that restaurant, and then figure out the percentage to tip out for each worker based on that volume. 

There's only one restaurant in our group where we add on gratuity and that’s in Miami. We always do research regarding what happens in a particular region and Miami was one market where we decided to add on that auto grat. We don't get any pushback there because it's just normal for that market.