Restaurant Management

6 Tasks Restaurant Teams Can Automate with AI

Posted on July 31, 2023July 31, 2023 by kickfinadmin

AI is kind of having a moment right now.

It’s basically impossible to scroll through a newsfeed without stumbling across an article (or 10…) about the rapid developments we’re seeing in AI technology — and all of its benefits, risks, and mind-blowing potential to change life as we know it.

While AI is getting quite a bit of PR here in 2023, many industries have been embracing AI for years, including hospitality. From automated customer insights to voice assistants, AI is becoming increasingly entrenched in restaurant operations.

What even is AI?

AI (short for artificial intelligence) is an exciting new technology that’s changing nearly every industry — including the service and hospitality industries. AI is intended to take in information and respond in a way that mimics human responses. This means it can respond to queries with valuable information. If you use Alexa at home, you’re interacting with AI every day.

Machine learning is what makes AI really valuable, especially in restaurants. Machine learning takes in information from a data source (for example, your POS) and analyzes it. Once the tech “learns” from historical data, it can predict trends and behaviors in the future. For example, TikTok uses machine learning to determine which videos you’re more likely to engage with and shows you new content based on those predictions in hopes of keeping you on the app for longer.

Why use AI in your restaurant?

Running and managing a restaurant is stressful. Operators and managers wear a lot of hats, and it can be hard to streamline operations when you’re pulled in so many different directions. Restaurants can use AI to make life just a little bit easier — and cut costs while you’re at it.

Does that mean the service industry should start preparing for the inevitable robot takeover? Not just yet. The human element is still vital to many segments. But there’s never been a better time for restaurant operators to innovate: new AI advances can streamline and simplify everyday restaurant management processes, helping operators to uncover new efficiencies, increase staff and customer satisfaction, and ultimately boost your bottom line.

Here are a few ways AI can lighten your workload and optimize your restaurant operations.

1. Menu Development

Your chef and kitchen staff have been hard at work putting together delicious dishes that will turn your new customers into regulars, but how are you supposed to put all the flavors and components into a short, enticing description? With AI, you can skip the writer’s block and simply generate well-worded descriptions in seconds.

2. Hiring

Restaurants are still experiencing staffing shortages and struggling to fill positions — but what if AI could streamline your hiring efforts? There are a few ways to relieve the burden that staff issues have put on restaurant management.

Writing job descriptions: Remember how we said it was tedious to write menu descriptions? Same goes for job descriptions. Of course, you want to provide all the details about the role, but sometimes it can be hard to creatively describe a serving job and show off your restaurant’s culture. Instead, turn to AI for quick job descriptions that only need to be slightly edited to show off more personality.
Reviewing applications: Once you’ve posted your job online, you have a few different ways to leverage AI in the hiring process. For one, you can use AI to filter out candidates that don’t meet your requirements about experience, age, or availability. Then, you have fewer applications to wade through and can focus on serious candidates only.
Chatbot: To really lean into the AI trend, you can also use an AI chatbot that has a text conversation with applicants to learn about their skills, job experience, pay expectations, and availability. Choose a chatbot that can integrate with your existing technology, so you don’t have to create your own software (unless you want to). Rather than filling out the traditional application form, your candidates will share about themselves in a more casual, conversational manner, almost like a pre-interview. These chatbots can still filter out candidates who aren’t going to be a good fit — and it might impress your more tech-savvy candidate pool.

Of course, you can also tackle staffing issues by automating some of your positions. QSRs can especially take advantage of AI voice assistants to man drive-thrus and take orders, while your human staff focuses on fulfilling them.

3. Scheduling

You’re not limited to AI writing tools. New technology can automate and optimize almost every aspect of your business, from front of house to back.

Now that AI’s streamlined your hiring practices, give it a chance to improve your schedule, too. Restaurant budgets can be tight, so you don’t want to have too many employees during a slow weekday lunch — but you also don’t want to be understaffed during a huge rush. Machine learning can analyze your sales data to determine peak times and the optimal amount of staff to schedule for a shift. You can put in parameters that will keep the schedule within budget, and then use the AI-generated roadmap to create your weekly schedule.

4. Forecasting

AI can do even more with your POS data to optimize your entire restaurant and predict trends, empowering you to make data-backed business decisions.

For example: inventory management. No one wants to over-order and let food spoil, nor do you want to 86 a popular dish because you ran out of one ingredient. With AI, you can utilize POS data to determine your best-sellers, which items you frequently run out of, and where you could be over-purchasing. With your inventory optimized, you’ll prevent food waste and serve your customers their first-choice dish.

>> Find out more about Revenue Forecasting for restaurants

5. Marketing & Customer Insights

Once you get people in the door, you want to keep your loyal customers coming back. Many small restaurants don’t have the luxury of a full-time employee to run their marketing efforts. Good news: You can employ AI instead.

Auto-generate marketing emails to let your customers know about specials, events, and coupons. If you have a loyalty program, you can even take it a step further. AI can figure out each customer’s most frequent orders and when they’re most likely to come in, and offer individualized deals based on their ordering habits. Your customers will feel like you really know them, and you can relieve pressure off the FOH manager who does marketing on the side.

6. Customer Engagement

While you don’t want to lose the human touch that really makes your customer experience, there are a few tasks you can pass off to AI that will free up managers’ and employees’ time for more pressing tasks (especially when they’re in the weeds on a busy Friday night).

If your phone is ringing off the hook with people asking about wait times, making a reservation, or wondering if you have outdoor seating, AI can help field calls and answer their questions. You can program the AI to pick up on certain terms (like “reservation”) to generate the answer your guests are looking for. If you can integrate AI with your waitlist and reservation software, the AI can add callers to your waitlist, estimate wait times, and create reservations.

Adding an AI chatbot to your website can also quickly engage customers, allowing them to get answers to specific questions that they’d normally call in to ask.

Of course, there are limitations to tech, especially in the communication and hospitality departments. When choosing to add any new technology to your restaurant operations, make sure that it gives you more tools to engage with customers — and doesn’t create a cold, mechanical dining experience. It’s there to make your life easier, but AI can’t replace good service and personal connections with your customers.

Looking to simplify your tip out process? Kickfin can help. Check out a demo of our instant digital tipping software.

How to Comply with Tip Pooling Laws

Posted on July 31, 2023July 31, 2023 by kickfinadmin

Thinking about implementing a mandatory tip pool?

In more collaborative work environments, tip pooling might seem like a logical, equitable way to handle employee tips. It can encourage teamwork, build a spirit of camaraderie, and ensure that all of your employees are fairly compensated for their hard work.

But depending on where you’re located, tip pooling laws can get very complicated, very fast. A quick Google search will show you how many restaurants have found themselves at the center of costly lawsuits because they were (often unintentionally) operating illegal tip pools.

So: before you pass go, get up to date on the latest tip pooling laws and regulations to avoid hefty fines and a bad reputation.

The Fair Labor Standards Act (FLSA)

Starting in 2020, the federal Department of Labor made significant rulings based on the tip regulations stipulated under the 2018 Fair Labor Standards Act. These new rulings are designed to better protect tipped employees from wage theft and other illegal tipping practices. They’ve released their final rule, which went into effect on April 30, 2021.

One important thing to note: while the DOL uses the umbrella term “tip pooling,” these rules apply to all tip-sharing practices, including tipping out. Even if you’re not explicitly pooling and redistributing tips, any tip sharing at all is subject to these laws.

Who can keep tips?

Employers are completely barred from keeping any tips, pooled or otherwise. According to the FLSA, tips explicitly belong to the employees, not their employer, so any tips withheld by the employer can be seen as wage theft.

As an extension of the employer, managers and supervisors may not participate in a tip pool or retain any employee tips. Managers can, however, keep tips that are directly given to them based on service they directly and solely provided.

Some of the tip pooling laws depend on if your restaurant is taking the federal tip credit of up to $5.12:

If you do take the tip credit, non-tipped employees (like cooks, dishwashers, and other back-of-house employees) cannot participate in the tip pool.
However, if you do not take the tip credit and pay traditionally tipped employees the full minimum wage, the tip pool can be shared with your back-of-house staff and other non-tipped employees.

Maintaining Payroll Records & Timeliness

For the most part, the Department of Labor rewards employers who don’t take the tip credit and pay their tipped employees the full minimum wage by offering more flexibility around tip pooling.

Still, even non-tip credit establishments have some extra rules to follow. Employers who require employees to pool their tips must maintain thorough records of payroll, tip redistribution, and the weekly/monthly tip amounts for each employee.

Speaking of payroll, all pooled tips must be redistributed to employees by the end of the pay period in which they were earned. The timeliness of returning tips to employees applies to all establishments, whether you take the tip credit or not.

State and Local Tip Pool Laws

Don’t forget that tipping laws vary state by state — and some states explicitly bar tip pooling. If you live in Kentucky, Wyoming, Minnesota, or Montana, you cannot require employees to participate in the tip pool, but employees may voluntarily pool tips if they so choose.

Additionally, many states have higher minimum wage requirements than those laid out by the federal government, so you may need to double-check that your tip pool doesn’t cause any employees to fall below their required pay.

As of now, 14 states have additional state laws that extend beyond the FLSA rulings, so make sure to read up on your state’s tipping regulations before implementing a tip pooling system.

Here are the states where tipping & tip pool laws vary:

California

Tip pools are legal, but they cannot be shared with BOH employees or any manager who has the power to fire employees.

Employers are also required to pay servers the full minimum wage of $15.50/hr — meaning California business owners cannot take the tip credit.

Colorado

Tip pools are legal, but Colorado does have more rules about the tip credit. If you deduct credit card processing fees from your servers’ tips, you cannot take the tip credit and must pay the full minimum wage of $13.65.

Delaware

Mandatory tip pools are legal, but servers cannot be required to contribute more than 15% of their tips. If servers create their own voluntary tip pool, they can choose to contribute as much as they would like.

Kentucky

Mandatory tip pools are illegal, but employees may voluntarily form their own tip pool.

Maine

Any mandatory service charges must be treated as a tip for employees, so therefore, service charges can be included in the tip pool.

Massachusetts

Mandatory service charges are viewed as tips that can be included in the tip pool, but only employees who provide direct service can take part in the tip pool.

Minnesota

Mandatory tip pools are illegal, but employees may form their own tip pools. The employees may also vote to allow their employer to manage and disperse from the tip pool. Mandatory service charges are also viewed as tips unless it’s explicitly stated to the customer that they are not being paid to the employee.

Montana

It is illegal for employers to mandate a tip pool, but voluntary tip pools are allowed. Mandatory service charges can only be treated as tips for the server.

New Hampshire

Mandatory tip pools are banned, but employees may elect their employer to manage and disperse voluntarily pooled tips.

New York

Mandatory tip pools are legal, but employers are banned from participating. Employees providing direct service and supervisors with limited authority are the only employees allowed to participate in the tip pool. All mandatory service charges must be paid to the employee who provided the service.

North Dakota

To establish a tip pool, employers must hold a vote for the tipped employees to make the final decision. At least 50% plus one of the tipped employees must vote in favor of the tip pool, and the employer must keep record of the vote.

North Carolina

Tip pooling is legal but only among regularly-tipped employees. Employees may only contribute up to 15% of their tips to the pool.

Utah

Tip pools are legal, but the tip pooling policy needs to be provided in writing before establishing a tip pool or hiring any new staff.

Wyoming

Only voluntary tip pools are legal in Wyoming, and employers are banned from pressuring or coercing their employees to form a tip pool.

What’s at stake?

If you don’t comply with federal tip pooling laws – even without your knowledge – you could be liable for massive fines and employee back pay. In 2020, the Department of Labor also released its final rule on Civil Money Penalties (CMPs) to determine the punishments that come with violating the FLSA tip regulations.

The final rule clarified that the Department of Labor can assess penalties of up to $1,162 per violation, even if the violations aren’t repeated or willful. This fine is in addition to back pay and damages that employees can sue for.

On top of the financial risks, you don’t want to ruin your reputation. No one wants to work for a company known for shady tipping practices, and customers generally don’t want to support unfair labor practices either. It’s in your best interest to take tipping laws seriously.

Rulings and regulations can get confusing without expert help. It’s always safest to speak to an attorney to ensure that you’re complying with federal, state, and local tipping laws to keep your business out of hot water.

Additional Resources

Once you’re confident that you’re complying with tipping laws, consider making tip pools and tipping out even easier. Request a demo of Kickfin to see how digital, instant tip-outs simplify tipping, save time, and help you retain employees.

The Ultimate Guide to Restaurant Tip Management

Posted on July 24, 2023August 15, 2023 by Keely Hungate

Restaurant tip management can be confusing and time-consuming, especially if your restaurant has a large staff. Differences in state laws regarding employee wages and tipping, as well as the overall increase in credit card usage, further complicate how tips are shared with your employees.

If you own or run a restaurant, you’re responsible for creating an in-house tipping system that’s fair to both your front-of-house and back-of-house staff members — as well as your customers.

Read on to learn everything you need to know about managing tips in your restaurant — or click here to schedule a demo with our team to hear more about how Kickfin can help manage your restaurant’s tips.

Understanding tips and wages

Federal law requires that everyone employed in the U.S. be paid at least $7.25 per hour. Many states have minimum wages higher than the federally-mandated minimum. However, due to the long-standing practice of tipping, many states have instituted lower paid minimum wages for employees expected to supplement their income with tips. Paying a wage lower than $7.25 to tipped employees helps your business save money, but is not legal in every state and situation.

For example, according to the U.S. Department of Labor, it’s legal to pay tipped employees in Alabama as little as $2.13 per hour if the employee earns at least minimum wage by the time tips are factored in. However, in Washington, D.C., establishment owners must pay tipped employees a full wage of $8.00 per hour, regardless of tips earned. This wide variation makes it important to consult with a local employment lawyer versed in your state’s laws when establishing your restaurant’s tipping system.

What is a tipped minimum wage?

The federal minimum wage is $7.25 per hour, with many states implementing higher minimum wages. However, employers can pay employees who regularly receive tips a lower direct hourly wage, known as the tipped wage. A tipped wage is typically lower than the standard minimum wage and is set by law. The rationale behind these laws is that tips employees receive make up the difference between the rate the employer is paying and the minimum wage.

For the tipped minimum wage system to be valid, an employee must actually earn at least the state’s minimum wage after tips. Most businesses accomplish this by requesting that employees report tip earnings at the end of each shift. The business then adds together the total amount of money the employee has earned in tips versus an hourly wage and divides this figure by the number of hours the employee has worked. If this calculation reveals that the employee did not earn minimum wage, the employer must supplement their income.

What is a tip credit?

A tip credit is the extra money an employer must pay to an employee to make up the difference between the tipped wage and the state’s minimum wage.

Let’s take a look at an example of a situation where an employer might need to supplement a tipped minimum wage. Imagine you manage a restaurant in a state where the tipped minimum wage is $5 an hour and the standard minimum wage is $10 per hour. After working a 40-hour week, one of your employees reports a total tip-out of $180.

However, if your state has a minimum wage of $10 per hour, this means that any of your employees who work at least 40 hours must receive at least $400 in total compensation ($10 per hour). If an employee only earns $380 between wages in tips, you would need to make up the difference by including an extra $20 tip credit in the employee’s check.

If the employee earns more than minimum wage when calculating tips plus wages, no action is taken. For example, you can’t reduce an employee’s wages to $0 if they earn more than minimum wage in tips alone.

How to collect tips

There are a variety of ways your restaurant can accept tips from customers. Some of the most common ways to collect tips include:

Cash: Cash is the most straightforward way to accept tips. Each employee may keep the cash they collect on each check, or pool tips together to split among the staff.
Credit cards: Many customers prefer to put their tips on the credit card they use to pay for their meals. Accepting tips via credit card is convenient for customers, but will require calculation via your in-house system to pay them out correctly.
Third-party payment apps: Some establishments ask individual employees to create payment accounts with third-party payment apps, like Venmo and CashApp.

Employees are allowed to independently collect tips with their user codes. These tips are usually treated as cash for reporting purposes, making this method unsuitable for establishments that pool tips.

Many modern point of sale (POS) systems or terminals used in restaurants have the functionality to suggest tip amounts to customers during the payment process. If using these systems, ensure your tip recording and reporting system complies with local regulations.

How do you combine cash and charged tips?

If your restaurant receives both cash and charged tips, it’s essential to have a clear process in place to handle and distribute them appropriately. This requires keeping a careful record of all tips received — regardless of whether they’re in cash or on a credit card. Most POS systems include a mechanism to collect this information automatically as it’s entered, but you may want to keep an additional backup record.

Store cash tips securely and separately from other funds to ensure accurate accounting and distribution. Establish a process where employees can safely deposit their cash tips in designated envelopes or containers, and have a standing protocol around who can access funds and how. It can be helpful to keep cash tips locked in a manager’s office until distribution.

There are a few options for disbursing credit card tips to employees. You can pay out credit card tips in cash to employees at the end of the day, but this requires taking credit card tips from the restaurant’s cash reserves, which may be limited during slow seasons. You can also include credit card tips on each employee’s wage check.

However, this strategy may require spending more resources on accounting and billing to ensure all employees are fully compensated.

And, keep in mind: Many hospitality employees are drawn to the industry because of the promise of daily payouts. Putting tips on payroll can be hard on your staff, especially if they’re accustomed to nightly tip-outs and have to start waiting days or weeks to receive their tip earnings.

A cashless tip distribution solution can be a helpful tool in streamlining and simplifying the process of distributing tips, especially when combining cash and charged tips. With a cashless solution, charged tips can be directly deposited into individual employee accounts or a centralized tip pool, reducing the need for manual handling of cash or checks. This also reduces the chances of making a costly mistake when distributing employee tips and calculating wages.

Ways to distribute tips to your employees

“Tipping out” refers to the service industry practice where employees who receive tips share a portion of those earnings with other employees who provide a service or support role during the customer’s experience. For example, while servers might directly receive tips, house rules might establish that servers tip out a small percentage of the tips they collect to the back-of-house staff or hosts who do not collect tips.

Not every establishment tips out, with some electing to pay higher wages to non-tipped employees. These are some of the most common tip division and redistribution strategies to consider for your restaurant:

Individual employee tips

The easiest method to handle tips is to allow each employee to keep the tips that they individually earn. Only tipped-wage employees are required to earn tips, so this method empowers those interacting directly with customers to keep the tips that they collect. However, this method benefits only individual tipped employees and may lead to uneven earnings across your staff.

Tip pooling

Tip pooling is a practice common in the service industry where a portion of the tips received by employees is combined into a common pool and then distributed among a group of eligible employees. Rather than keeping individual tips, employees contribute a portion of their earnings to be shared among the team.

Typically, a predetermined percentage or formula is used to allocate the pooled tips among the eligible employees. This is usually based on employee roles and contributions to the overall customer service experience. Some establishments tip out the same percentage to all employees, while others devote a larger percentage to the individuals collecting the tips.

The purpose of tip pooling is to foster teamwork, incentivize collaboration, and ensure all employees involved in providing excellent service receive a fair share of the tips — even if they don’t directly interact with customers or receive individual tips.

However, tip pooling may also foster contempt amongst employees, particularly if employees earning minimum wages receive the same percentage of tips as tipped-wage employees. That’s why it’s important to weigh the pros and cons for your team, ensure your policy is fully compliant with tip pooling laws, and create a culture of communication and feedback channels so you can understand what’s working and what’s not.

Percentage-based tip-outs

Percentage-based tip-outs involve distributing a specific percentage of the total tips earned by an employee to other individuals or groups. By dividing tips by varying percentages, management can ensure that tipped employees receive a larger percentage of their tips while also keeping things fair for non-tipped employees crucial to the customer experience.

For example, let’s say your restaurant has a 20% tip-out policy and a server earns a $100 tip. In this case, the employee will be required to distribute 20% of their tip ($20) to non-tipped employees. Depending on your restaurant, this may include hosts, prep cooks, bussers, and other qualifying employees. The remaining 80% of the server’s tip ($80) is theirs to keep.

Point system tip-outs

Some establishments use a points-based tip-out system. In a points-based tipping system, rather than distributing a percentage of the total tips, a certain number of points are allocated to each employee, and these points are used to distribute the tips among the team.

Let’s take a look at another example using a $100 tip. If your restaurant uses a point system, you might assign a server 50 points, a bartender 30 points, and a busser 20 points. In this example, points correlate to percentages, so a server would keep $50 of the tip. Accordingly, the bartender would receive $30, while the busser receives $20.

Points-based tipping systems allow for a more customized and flexible distribution of tips, considering the different roles and contributions of the employees. The allocation of points can be based on factors such as seniority, job responsibilities, or performance evaluations, enabling a more nuanced approach to distributing tips among the team.

Tax and reporting obligations

The IRS has specific regulations regarding tip reporting, withholding, and taxation. Failing to comply with these requirements can result in legal and financial consequences.

As a business owner, it’s crucial that you take steps to keep tips and payouts in order. Following these tips can help you stay on the right side of the law:

Keep accurate records: Keep detailed records of all tip income, including cash and charged tips. Document tip allocations, distribute tips promptly, and maintain accurate records of tip pools and distributions. This documentation will be valuable in case of audits or employee inquiries.
Implement clear and consistent policies: Establish written policies on tip reporting, allocation, and distribution. Ensure employees understand these policies and provide regular reminders or training sessions to reinforce compliance. This will help prevent disputes with employees, especially those collecting tips.
Educate employees on their responsibilities: Train your staff on the IRS requirements for tip reporting and explain the importance of accurate record-keeping and reporting. Encourage employees to report their tip income correctly and provide them with resources or guidelines to do so.

Remember that as the business owner, the responsibility to maintain financial records falls on your shoulders. This is one area where a cashless tip management system can be majorly beneficial.

How software makes restaurant tip management easier

Even the most organized business owners can find themselves confused when managing dozens of tipped employees. Software, including tax reporting software and POS management systems, can make the process of tracking payouts and income easier. In particular, a cashless tip management system can provide a host of benefits to employers and employees themselves.

Enhanced accuracy and transparency: Cashless systems provide accurate tracking and recording of tip transactions. This helps ensure that tips are distributed correctly and transparently and minimizes the risk of human error that can lead to lawsuits and claims of improper employee payments.

More convenient for employees: Cashless tip distribution allows employees to receive their tips directly in their bank accounts or digital wallets, offering flexibility and convenience. With a growing consumer trend toward digital payments, some employees prefer the ease of non-cash payouts.

Increased efficiency: Cashless systems streamline tip distribution. Instead of manually handling cash, the system automates the process, saving time and reducing administrative burdens. Employees also don’t need to worry about the risk of loss and theft that comes with carrying cash.

How Kickfin helps with restaurant tip management

Kickfin really helps restaurant managers with facilitating the cashless disbursement of tips to eligible employees. Fewer and fewer customers pay for transactions with cash — which is why so many managers find themselves running to the bank on a daily or weekly basis because the safe is empty, and there’s not enough cash to pay out tips.

With Kickfin, you’re able to track your tipped employees’ earnings through your normal POS, and quickly total their tipped earnings at the ends of their shifts. Then, with the touch of a button, you can distribute their tips to them electronically, without having to count cash or stuff envelopes. And your employees’ tips hit their accounts instantly.

Click here to learn more about Kickfin and how our cashless tipping solution can work for you

How to Recruit Summer Staff for Your Restaurant

Posted on June 26, 2023June 26, 2023 by kickfinadmin

School’s out — which means a lot of students are about to hop into the hospitality workforce. If summer is your busy season, you’re probably used to pulling in folks who are looking for a gig so you can meet high-volume needs.

But the labor market is still tough, and you won’t be the only restaurant looking to staff up. If you want to win over the in-demand seasonal workers, you’ll need to stand out from the crowd.

Why hire summer employees for your restaurant?

It’s been hard to find good help at your restaurant thanks to the labor shortage, so it might seem counterintuitive to hire someone just for a season.

But now more than ever, flexibility is your greatest recruiting tool. By hiring people just for the summer, you can beef up your team to handle the busiest season of the year without requiring long-term commitments that could turn off potential hires.

Plus: If you’re in need of year-round help, it can also buy you some time to run a real recruiting process and hire for the long haul.

How to bring in summer hires:

You’re not going to be the only restaurant looking to add to their staff, and your applicants will have their pick of places to work. It’s time to get proactive — and creative — with your recruiting strategy to win them over.

1. Get the word out (and leverage every channel)

The obvious first step to finding new employees? Let them know you’re hiring.

Go social: We’re talking about Gen Z here, so if you want to meet them where they are, it’s time to go digital. At a minimum, post your job description wherever you’ve got a following (no matter how big or small) — Facebook, Instagram, etc.
Boost it: It doesn’t cost a lot to boost a post, so if you want to expand your audience, put a small spend behind your listing. Be sure to identify geographic targets as you’re setting up your mini-campaign. (If your restaurant is in Milwaukee, you don’t want to spend money on impressions in Santa Fe!) And of course: sell it. Include pictures and #workperks (more on that below), and show off your team culture.
Leverage email: Got a customer email list? Take advantage of that, too. Even if your target staff demographic doesn’t overlap with your customer base, word of mouth can be a great way to pull in talent.
Update your site: These days, everyone checks out the menu before they hit up your restaurant. Use a homepage banner or pop-up tool to get your
Old school still works, too: And then, of course, don’t neglect the tried-and-true recruiting methods. “Now Hiring” signs and fliers are still effective. Have applications ready at the guest stand. And think outside the four walls of your restaurant. Check with local high schools, colleges, and shops to see if you can display a flier in the bathroom or near a register.

2. Promote your perks

What makes your restaurant a great place to work? Identify your restaurant’s unique selling points and mention them often in your job descriptions and when you meet with candidates. And while offering healthcare and PTO for your long-serving employees is great, you need to have perks that apply to new hires who will only be around for a few months.

Having trouble thinking of your perks that would benefit a short-term employee? Here are a few ideas you can pull from:

Monthly employee awards and celebrations
Instant tip payouts with a digital tipping tool
Upselling competitions with gift cards as rewards
Flexibility with vacation days
Free shift meals
Employee discounts

3. Offer referral bonuses

Turn your top talent into your ambassadors by encouraging them to refer potential employees. You’ll cast a wide net with less effort (and you’re more likely to get intro’d to team members you trust), while your staff will have the opportunity to work with their friends — it’s a true win-win.

Encourage and incentivize your employees to bring qualified candidates in for interviews. To ensure you’re working with a high quality pool, consider structuring the referral program so that employees get a referral bonus if their candidate actually gets offered the job.

4. Lean on technology

Most of your summer hires are going to be Gen Z students out of school for the summer — and they’re going to expect tech in any workplace. They probably won’t even look twice if you don’t offer a mobile-friendly job application online.

On top of an easy application process, you’ll need to differentiate yourself from other restaurants by showing applicants the tech you use and how it can benefit them during their tenure. For example, do you have a scheduling system or are you still printing off and posting schedules the old-fashioned way? Do you use tech to easily trade or pick up shifts?

Finances are also top-of-mind for your summer applicants, so let them know how tech can benefit their wallets, too. If you have a digital tip out solution in place, you can show them how easy it is to get direct, instant access to their tips — meaning no more waiting around for cash after their shifts. Instead, servers will be able to head out as soon as they finish their side work and spend the rest of the day by the pool.

For restaurant owners, summer is an exciting – and hectic – time of year, but with the help of summer employees, you can make it your most lucrative season.

Ready to leverage tech in your recruiting strategy? Check out a demo of Kickfin today.

Beat the Labor Shortage: How to Increase Tips and Keep Your Best Servers

Posted on June 20, 2023June 20, 2023 by Kaley Pigman

In the midst of a (neverending?) labor shortage, restaurant operators are doing everything they can to encourage their best servers to stick around.

A sure-fire way to keep your current employees happy? Help them earn more money. Of course, when margins are tight, that can be tricky — which is where tips come in. Tipping allows employees to earn significantly more than what your revenue constraints might allow.

In fact, for many restaurant teams, particularly in the full-service segment, tips make up the majority of a server’s income. And if you practice any sort of tip pooling, then tips can increase take-home pay for other front-of-house and back-of-house employees, too.

While tip amounts are generally determined by the total bill and the quality of service a customer receives, there are things you can do to help your employees earn more tips. Here are a few ideas to try out at your restaurant.

1. Give them bigger sections

Your veteran servers can handle a lot more than you give them credit for. They probably want everything you throw at them, because more tables can generally mean more tip-making opportunities for them.

We get it: you don’t want customer service to slip. But you can trust your best servers to be honest about how much they can handle. If their answers vary, you can create different-sized sections where you reward top performers with more tables, while newbies get their feet wet with smaller sections.

2. Server training sessions

In the restaurant industry, you’re bound to get a lot of green serving staff. Give them the knowledge and tools they need to exceed customer expectations and operate with efficiency, so they can start earning more tips, faster.

If you don’t already have some kind of formalized training program in place, now’s the time to start. (For tips on onboarding new employees, check out our webinar here.)

Of course, there are some basics they’ll need to learn — policies, standard operating procedures procedures, how to use your tech stack, etc. If they’re new to the industry, don’t make any assumptions: introduce them to every part of the restaurant. It’s important that they understand operations from front to back and how their success is tied to the success of the whole team.

Soft skills are equally important. Being able to engage with guests in a warm, professional manner can take the dining experience to the next level — and it compensates for slip-ups here and there while employees are still learning the ropes.

3. Teach the art of the upsell

In addition to the training they receive during onboarding, it’s never a bad idea to offer ongoing sessions for newer staff and seasoned pros alike. One focus area to consider: coaching your team on the art of the upsell.

No, you don’t want your servers to turn into full-blown salespeople; but when it’s done in a way that’s focused on improving the guest experience, it has the added benefits of boosting tip amounts and increasing your restaurant sales, too.

For example, hold a drink pairing class where your team learns what drinks to suggest for each order. Help them practice presenting daily specials in a way that’s appealing and easy-to-follow. Remind them not to miss an opportunity to suggest a starter and be smart about how they position the option for a dessert. (E.g.: They’re full from dinner? Offer that pie to-go!)

Not every server will have time for extra classes (school, family, and life can get pretty hectic), so make these classes optional. Your servers who can make it will thank you for providing them with flexibility and tools to increase tips, and your customers will notice and appreciate how knowledgeable your staff is.

4. Run your kitchen efficiently

We all know that servers bear the brunt of frustrated, hangry customers. If guests are waiting and waiting for their food, they often blame the server (even if they’re not at fault) and deduct from their tips. Also, the longer a party sits waiting for their food to come out, the longer the server will have to wait to get their next table.

Want your servers to earn more money? Address any back-of-house issues that might be impacting the customer experience. Hungry guests will be much happier when their food arrives quickly, and it’ll help your servers turn and turn more tables throughout the night.

And keep in mind: For restaurants that include back-of-house employees in their tip pool, kitchen employees benefit from better tips, too — so help them understand how a rising tide lifts all boats.

5. Manage expectations at the host stand

Just like the kitchen, the host stand is completely out of the servers’ control — but it can seriously affect their tips. While you can’t really help going on a wait during a busy Saturday night dinner rush, you can train your hosts to tactfully manage guests’ expectations, so they aren’t fuming by the time their server comes to greet them.

For one, hosts need to accurately predict wait times. There’s nothing worse than telling a customer that it’ll only be a 20-minute wait and then watching them sit squirming in your waiting area for 45 minutes. Consider taking advantage of restaurant tech that can help hosts manage the floor and the waitlist.

It can also be confusing to guests if they’re on the waitlist, but they see empty tables. What they may not know is that you don’t have enough servers to cover all of the tables in the restaurant — so if that’s the case, consider asking your hosts to be proactive about explaining the situation.

Of course, when a party leaves and the table is ready to be cleaned, encourage your hosts to jump in and support busy bussers so that the next guests can be seated quickly.

6. Put your managers back on the floor

When things go wrong, managers often swoop in to save the server’s tip. Managers are there to smooth over customer complaints and ensure a high-quality dining experience for every guest in your restaurant. But if they’re in the back office working for the entire shift, servers don’t get the support they need.

Free up your managers’ shifts so they can spend more time touching tables, refilling drinks, and supporting the FOH staff. When managers can spend more time interacting with guests and helping servers who are in the weeds, guests enjoy their dining experiences more and are happier to leave a generous tip.

(One idea to give your managers hours back in their day: Try out Kickfin’s instant cashless tipping software so your managers can spend less time counting out cash tips and crunching numbers, and more time connecting with customers and supporting your servers. Check out a demo today.)

7 Reasons Your General Manager Will Thank You for Digitizing Tip Payments

Posted on June 13, 2023June 13, 2023 by Kaley Pigman

General managers have one of the toughest jobs in hospitality. They’re in the trenches with their team, day in and day out — but with the added responsibilities of hiring, training, purchasing, inventory management, maintaining guest satisfaction, ensuring adherence policies and standard operating procedures…the list goes on.

It takes the right skillset — and a lot of grit — to succeed as a GM. When you find a talented one, as an operator, it’s worth doing everything you can to keep them happy and make their life easier.

Enter: digital tipping. For restaurants that move away from cash tip-outs and automate tip distribution, cash management becomes one less (tedious) task on your GM’s plate. That means they have hours back in their day for work that matters. (Or maybe — just maybe — they’ll get to head home at a slightly more reasonable hour.)

Here are 7 reasons why your GM will thank you for making the switch to digital tip distribution.

1. Fewer bank runs

Your general manager probably bears the burden of ensuring there’s enough cash in the safe to pay out tips after each shift. For a lot of GMs, that means running to the bank to withdraw thousands of dollars in cash on a weekly (or more frequent) basis. Your GMs will be more than happy to scratch that task off their to-do list so they can stay in the store and on the floor.

2. Enhanced safety

Running to and from the bank isn’t just a time suck: it’s also a major liability. Having that much cash on your person makes your GM a perfect target for theft. And the same goes for their team once they’ve received their tip-outs and are heading home in the wee hours of the morning. (And realistically, the more cash you have on hand, the more opportunity there is for internal theft and skimming.) Sending tips straight to their bank account is truly the best of both worlds: employees still get instant access to their earnings, right where they want it — and everyone is a whole lot safer.

3. Less time counting (and recounting) cash

As long as you accept cash at your restaurant, your managers will have to deal with the daily task of counting down cash registers before and after every shift. But the vast majority of restaurant sales are credit card transactions. Given the inefficiencies (and risks) of cash management, there’s simply no reason to introduce cash into the equation in order to pay out those credit card tips.

Digital tip-outs eliminates the need for your GMs to manually count out stacks of cash and rolls of quarters until they’re going cross-eyed — which saves time and greatly reduces the risk of human error.

4. Freedom to shine on the floor

All of that time saved from bank runs and cash counting means your managers can spend more time on tasks that really matter. Sure, there will always be admin work to be done. But generally speaking, GMs aren’t in hospitality because they want to spend their days and nights heads down in the back office; it’s because they love to be on the floor managing their team, engaging with guests, and filling in gaps as needed. Finding ways to automate what you can — like tip distribution — gives them the freedom to do just that.

5. Minimal distractions (and drama)

Every time a server comes by the restaurant to pick up tips from the previous night, managers have to stop what they’re doing to open the safe, watch the server count the tips, and sign that they received them. Then they’ll try to return to the task at hand…only for another server to show up 15 minutes later.

Some restaurants also struggle with tip disputes — i.e., employees claiming that they didn’t get what they were owed. Unfortunately, with cash tip-outs, there’s low visibility into payment history and a lot of room for error. Combined, those two things can create major trust issues for your team.

Cashless tip-out solutions mean tip payments happen instantly — not the next day or week — and they provide you with a digital paper trail, which cuts down on the distractions and drama that your GM has to deal with on a daily basis.

6. Easy reconciliation and reporting

Your general manager wears a lot of hats — and for many restaurants, that includes some level of reporting or bookkeeping. Your cash tip-out system might include a lot of hand-written records, complicated spreadsheets…and heavy reliance on your bleary-eyed managers’ late-night math skills.

The right digital tipping solution will provide a much simpler and more accurate source of truth for tip payments, as well as robust reporting by shift, date, location, or individual employee.

7. A smart recruiting play

Your GM has been fighting on the front lines of the labor shortage, and they need new, creative ideas to bring in new servers. Digital tipping options could be the differentiator they need to bring in talented servers. As more restaurants embrace digital tipping, they’re finding that a lot of candidates — especially the Gen Zers — consider instant, direct-to-bank payouts a major work perk that’s rapidly becoming table stakes.

Give your GM the tools they need to succeed

A GM has to be good at juggling a lot of tasks in a fast-paced environment. That’s a non-negotiable. But when there’s an opportunity to make your operations run more efficiently and make your GM’s life easier? That’s a no-brainer. Eliminating the hassles of cash management makes a world of difference for the captain of your ship — so if you’re still doing tip-outs old-school, now’s the time to seek out the right digital tipping solution for your team.

Want to check out Kickfin’s digital tipping software? We’ll show you all of our general manager-friendly features in a 10-minute demo — schedule yours today!

Mythbusters: Questions and Misconceptions About Digital Tipping

Posted on June 7, 2023June 7, 2023 by Kaley Pigman

The advancement of digital tipping technology has a whole host of benefits for your operations, your team, and your bottom line.

But as every employer knows, any change to the payment process — even if it’s for the better! — can create uncertainty and concern among employees. That’s especially true in an industry like hospitality, where it’s not unusual for employees to live paycheck to paycheck.

While digital tipping is quickly becoming table stakes for restaurants, it’s still a relatively new technology. So if you’re considering a digital tipping solution for your restaurant, your employees will likely have questions — and maybe even some misconceptions — about what instant, cashless tip-outs really mean for them.

Below are few of the myths we find ourselves regularly busting, as well as important information that can help your people rest assured that digital tipping is a simple, secure — and did we mention instant? — way to receive the tips they’ve worked so hard to earn.

Does digital tipping affect servers’ tax liability?

For some servers, one of the big perks of working in the restaurant industry is that cash tips can’t necessarily be tracked — so they may not report all of their tipped income. As digital tip-outs rise in popularity, many servers are concerned that this will mean more tip reporting and higher tax liability.

But the thing is: it doesn’t. Even though your employees’ tips might be paid out in cash, that doesn’t mean income is unreported. If your restaurant is using a POS system where you input your credit card tips after each table closes out, that POS data is already being used to report your servers’ income and the IRS is taxing them on it — which is why your employees might receive $0 paychecks. In fact, the IRS is gearing up to rely solely on POS data for tax information.

Just like before, if a customer leaves a cash tip, it’s on the employee to claim it, but credit card tips have been (and always will be) reported to the IRS.

Do employees need to download an app?

If your employees are anything like us, they have no storage to spare on their smartphone. So when you announce the rollout of a digital tipping solution at your restaurant, you might get some eyerolls: Does this mean there’s another app they have to download, and another account they have to manage on a regular basis?

Short answer: nope. It depends on the solution, of course, but a software like Kickfin doesn’t require an app download.

In fact, employees can sign up for Kickfin in 30 seconds — without having to download anything. You simply send out an invite to each employee, they click the link, and they sign up through their browser in seconds.

That means your staff get instant tip payouts, and they don’t have to delete a million photos to free up space for yet another app. Win-win!

Do digital tipping solutions require employees to use a paycard?

Here again, not all digital tipping solutions digitize tips the same way.

Yes, some solutions require employees to use a paycard. The problem with paycards is that employees might get hit with unexpected fees when they want to use their card or transfer money to their bank account. (And those bank transfers can take up to 3-5 days!)

Kickfin’s solution bypasses paycards and sends tip earnings directly to their bank accounts — which is where most employees prefer. Funds are instantly accessible the moment employees are tipped out (including nights, weekends and bank holidays), so your people don’t have to deal with the paycard wait times if rent is due or they have bills to pay.

Does Kickfin store servers’ banking information?

Hackers and identity thieves are constantly taking advantage of weak security thresholds (or worse: accidental data leaks). So it’s not surprising that your employees might hesitate to share personal or financial information with a new vendor.

With a solution like Kickfin that sends tip earnings straight to your employees’ bank accounts, it’s fair to assume their banking information is saved within Kickfin and could be compromised.

But that’s actually not how it works.

In addition to being 100% PCI compliant, Kickfin tokenizes your employees’ financial information. Without getting into the weeds, the bottom line is that their financial information is safe from bad actors, period.

What about personal information?

Constant spam calls and emails are driving everyone nuts, so your employees may be concerned about entering their phone number and email address into yet another database that could be sold to telemarketers, spammers, and even scammers.

We get it: Kickfin will never sell your employees’ personal information. We value your trust too much. And if an employee opts out of Kickfin or moves on to a new job, they can easily delete their account.

Can unbanked employees use Kickfin?

Kickfin connects to 100% of all 10,000+ banks for instant, cashless tip-outs. But what about hospitality employees who are unbanked?

Realistically, some workers aren’t old enough to have a bank account; some might be undocumented; and some people simply choose not to use a bank.

If your unbanked employees are worried about how they’ll get paid with a direct-to-bank tipping solution, make sure you’re selecting a software that gives them options. For example: With Kickfin, employees can simply opt out of instant payouts and receive their tips via payroll. It doesn’t add any administrative complexity for your team, and it ensures they’re still getting access to the tips they’ve earned.

Still have a burning question about digital tipping? We’re here to help. Schedule some time with us today and we’ll get you the answers you’re looking for!

[WEBINAR] A Tip Pooling “Deep Dive” with Restaurant Strategy Podcast Host Chip Klose

Posted on May 17, 2023May 17, 2023 by Keely Hungate

Tip pooling can have big benefits for your entire team…but landmines abound.

Don’t just take our word for it: a quick Google News search for “tip pools” will return countless stories detailing costly lawsuits against operators who were — sometimes unknowingly — running illegal tip pools.

Of course, if you’re going to pool or share tips in your restaurant, compliance is only one (albeit very important) consideration.

It’s also critical to choose the best structure for your restaurant based on a variety of factors — including your restaurant type, team size and local market. And then there’s the rollout: Properly communicating the policy to your team and soliciting feedback can go a very long way in ensuring the success of your tip pool.

>>> DOWNLOAD OUR FREE TIP POOLING CALCULATOR TEMPLATES <<<

If you’re considering instituting a tip pool or tip share — or if you want to evaluate your current tip distribution program — check out our recent webinar moderated by Restaurant Strategy Podcast host Chip Klose and featuring Justin Roberts (co-CEO, Kickfin); Larisa Thomas (VP Operations, Kickfin); Beth Schroeder (Partner, Raines Feldman LLP).

Watch the recording below to hear the panelists cover the ins and outs of tip pooling, including:

Pros and cons of running a tip pool
The most common types of tip pool structures
Tip pooling myths and misconceptions
Avoiding costly tip pooling compliance mistakes
Best practices for launching or updating a tip pool policy

5 Questions To Ask When Choosing a Digital Tipping Solution

Posted on May 2, 2023May 2, 2023 by kickfinadmin

So, you’re ready to break up with cash. Good news: the hardest part is over.

But before you pop the champagne and celebrate your freedom from the pain of cash tip-outs, you have a few decisions to make. Payroll tips or digital tips? Instant tips or pay cards? There are a number of approaches to cashless tipping — but which one is right for your restaurant?

We’ve been there (actually, we live here…), and we’ve done the research for you. As you’re wading through your options, here are a few things to consider when choosing a digital tipping solution.

1. What is the employee experience like?

No servers = no sales. In year three of the labor shortage, we all know how hard it can be to find good employees, so you can’t afford to lose your best servers to the restaurant across the street. If your new tipping system doesn’t benefit employees, go ahead and dust off your “Now Hiring” sign.

Most of your employees want (and deserve) to be paid on a daily basis — so before you make the switch, consider how it can affect their financial situations.

And if you’re looking at a paycard solution, bear in mind — these types of digital tipping programs can cause a host of problems for your staff. For example, paycard fees can quickly add up, effectively docking your servers’ pay.

Ideally, you should choose a solution that gives your people instant access to their earnings (the same immediate gratification they had with cash) with minimal disruption.

2. What will implementation look like?

New tech can be daunting — but digital tipping software should be simple to implement, especially if you’re running as a standalone system. Make sure you ask the vendor you’re evaluating about things like:

How long will this take to implement?
What kind of training or onboarding support can we expect?
Are there any fees associated with the set up?

Bottom line: digital tipping should make your life easier, and that includes implementation. Make sure your solution has a clear, well-run process that gets you up and running fast.

→ Tech has never been so easy: See Kickfin’s digital tipping solution in action.

3. How does user management work?

You have veteran employees who’ve been with you for years, others who are just around for a season, and even some who work at multiple locations. When digging into digital tipping options, look for a solution that automates user management, making it simple to add new users and new locations as your business evolves.

4. What happens when I need customer support?

When you’re introducing any new system or process, questions are inevitable.

If your digital tipping solution doesn’t also include a robust, always-on customer success team, you may find yourself lost in the midst of employee questions, operational chaos, and maybe even some regret. Rather than feeling frustrated, ensure success by seeking out tipping platforms that are there to support your transition and keep you afloat.

5. Will I be in compliance with tip pooling laws?

Tip pooling regulations are always changing (and vary from state to state), so your digital tipping solution should also be a tool to help you stay in compliance with the law. As you evaluate tipping solutions, ask if they put up guardrails to prevent any tip pooling mistakes that could result in serious fines and lawsuits.

Evaluating digital tipping solutions for your team? We’ve got you covered. Schedule time with our sales team today and we’ll answer any questions you throw at us.

What Digital Tipping Really Means: Tip Acceptance vs. Tip Distribution

Posted on May 1, 2023May 1, 2023 by kickfinadmin

Confused by digital tipping? We hear you. Get up to speed with this quick rundown so you can keep up with the ever-expanding world of restaurant tech.

Digital tipping is an umbrella term that gets used interchangeably — but it covers a few different use cases. If you’re in the market for a digital tipping solution, it’s important to understand the different types of digital tipping.

Here’s how we break it down: tip acceptance and tip distribution. One is important for accommodating customers’ needs (and frequent lack of cash on hand); the other allows your business to pay employees more efficiently.

Depending on the type of company you’re running and the way your team is structured, you might have a need for digital tip acceptance, digital tip distribution, or both.

Digital Tip Acceptance

We’re probably stating the obvious here, but cashless tip acceptance isn’t new: every time a customer pays for a meal or service and leaves a tip on their credit card — well, you’ve just accepted a cashless tip.

But now more than ever, companies are using POS systems and digital tipping software (like Kickfin) to accept cashless tips where cash had been the norm — or where a tip may not have been offered at all. For example:

QSR and fast casual restaurants: Rather than dropping their change into a tip jar at the coffee shop or to-go counter, customers are being prompted to leave a digital tip directly on the POS. (You know, the old iPad swivel…)
Online ordering: Online ordering systems now allow users to leave a tip from their phone instead of paying a delivery driver in cash. Brands like Panera even give you the option to tip when you’re placing a rapid self-pickup order and wouldn’t otherwise have an opportunity to interact or tip the people preparing your food.
Hotel guest services: Many hotels are adopting text-to-tip options and QR code tipping so that guests can easily tip their housekeepers, valets, and concierges if they forgot to swing by the ATM first.

With the expanded uses of digital tip acceptance, we’re seeing many more opportunities to thank service industry employees for their work, even when we don’t have bills in our wallets or a direct interaction.

More tipping options allow employees to boost their incomes (and who doesn’t love that?), so they stop losing out on tips just because customers don’t carry cash. Plus: it allows even more employees to become tip eligible Business owners and managers can also use the opportunity to earn tips to attract and retain more hourly workers.

See cashless tipping in action! Get a Kickfin demo today

Digital Tip Distribution

Since most of your employees’ tips are cashless anyway, paying out cash tips has become a major operational challenge — which is why so many restaurant teams are choosing to move away from cash tip-outs.

But that doesn’t mean employees can’t get paid on the daily. Enter: digital tip distribution.

Instead of having your managers run to the bank, count out tips, and distribute envelopes of cash day after day, shift after shift, there is now a range of options for digital tip distribution — payroll, paycards, or instant digital tip-outs.

This side of cashless tipping is a little newer, and it’s impacting how restaurants, hotels, and other service industry businesses view their daily operations and hiring practices (for the better):

Digital tip distribution saves managers from running to the bank during a shift — when they could be touching tables, helping on the line in the kitchen, or getting caught up on inventory.
Operators save money because digital tipping eliminates costs associated with cash deliveries and employees waiting for their tips on the clock.
Digitizing tip payments can reduce the risk of error and theft.
Gen Z and Millenials are increasingly demanding instant, digital payment options. If you’re competing with other restaurants for the hourly workers, offering instant digital tips can make your establishment stand out from other employers.

Ready to check out cashless tipping for yourself? At Kickfin, we offer cashless tip acceptance and instant digital tip outs that are sent straight to your employees’ bank accounts, the second their shift ends. Request a demo of Kickfin.