Chef Alessandro Pirozzi, of Alessa by Chef Pirozzi, talks to customers at an outdoor table at Promenade on Forest in Laguna Beach, CA on Wednesday, January 13, 2021.
Paul Bersebach | MediaNews Group | Getty Images
Even as restaurants and fast-food chains raise menu prices, customers aren’t shying away from tipping wait staff and cashiers, according to a new report.
Diners fell an average of 19.6% at full-service restaurants and 16.9% at quick-service restaurants during the second quarter, roughly in line with a year ago, according to sales data from software provider Toast. According to the report, personal customers were typically more generous, receiving an average tip of 19.7%. Delivery or delivery customers received an average tip of 14.5%.
The average tip amount was up nearly 10% from the year-ago period — slightly more than restaurant menu prices have risen over the past year, Toast said. The cost of eating out rose 7.6% in the 12 months ended in July, according to the Bureau of Labor Statistics.
“Although there is some anecdotal feedback that inflation is affecting the rate at which people are falling, we don’t see that in our data,” Toast co-founder and chief operating officer Aman Narang told CNBC.
Other payment software providers have reported that restaurant tips have fallen after climbing earlier in the Covid pandemic. For example, rival Toast Square found that the average tip at quick-service restaurants fell from 17.2% to 15.2% from March 2021 to the end of February, according to a report from The Wall Street Journal.
Both Toast and Square’s software can be customized to prompt customers to tip at different levels, such as 10%, 15% or 20% for a full-service restaurant or $1, $2 or $3 at a coffee shop .
“Certainly our technology is an enabler,” Narang said.
As inflation puts pressure on household budgets, restaurant chains including McDonald’s and Chipotle Mexican Grill have reported seeing lower-income customers spend less money at their locations and higher-income customers visit more. often. Others, like Outback Steakhouse owner Bloomin’ Brands, have said consumers haven’t changed their spending habits — or that they’ve even shown a willingness to pay for more expensive options.
Toast compiles its quarterly report on restaurant trends by aggregating data collected from approximately 68,000 restaurants that use its software. Its clients range from independent restaurants to medium-sized regional chains.
The report also said full-service restaurant sales returned to pre-pandemic levels for the first time in the second quarter. Sit-down restaurants were hit hardest by the crisis as consumers cooked more of their meals at home or ordered through fast food lanes.
