Tag: tipping out

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!

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! 

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.