Rory brought to my attention an interesting article at Reuters.com the other day. Due to the poor economy and the fact that it’s hitting Londoners extra hard, a London restaurant has implemented a “pay what you want” policy for the month of February. At The Little Bay restaurant in Central London, business has been hit extra hard due to its reliance on diners in the high-paced financial district of the city. So in an effort to draw in more customers as well as to help Londoners affected by the credit crunch, meals at The Little Bay are essentially priced at zero. Diners can choose to pay whatever they want, from a penny to something more.
Now one has got to wonder what the going rate for plates at this restaurant is now that they have this new pricing policy in fact. Surprisingly, the owners report that they are sometimes receiving 20% more than the menu price for some dishes. Even though Vancouver hasn’t been hit as hard by any means as other parts of the world by the recession and the credit crunch, I’d be interested to see how this pay-what-you-want would work here. If I were to go to such a restaurant, I would still feel somewhat obligated to pay at least what the menu price lists the dish as, unless service or food quality was severely lacking.
How much do you think you would pay at a restaurant with this kind of “promotion”?
Read the full article here: http://www.reuters.com/article/lifestyleMolt/idUSTRE5124N120090203
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From what I was able to gather, this restaurant (website here: http://www.littlebay.co.uk/london.html) would be on the same lines as a Moxie’s or Milestones. If that is the case, I don’t think this concept will fly. The problem is due to the service. No, I am not implying the service in these places are necessarily bad. Rather, since the tips make a great portion of the fronthouse people’s income, that uncertainty on how much they will get might, in its funny ways, might affect how they will treat the customers. As a result, the customer might not be so “generous” on how much they will be willing to fork out for the meal. If the concept of “gratuities is included already in the price you see in the menu – feel free to tip extra if you feel like” is in effect here, I think might work.
Now, I won’t put all this weight on the server’s shoulder either. If the food is not good, I won’t be willing to pay much either.
Now, if it is a sports bar or a pub, this concept might easily work; after all, drinks generate far more revenue than food.
But, back to the question of how much I would pay, well, that’s a difficult one. Assuming it is a resturant I have been for quite some time. In that case, I ought to have an idea of the cost of most of the dishes. I think I would instinctively pay the amount listed there (even if I don’t remember, I should have a gist of how much). That way, I don’t feel I am shorting the restaurant nor I feel I am cheating them. In other words, I am being “fair”. In the case it is a restaurant I have never been before and prices are not posted, of course, I would ask (or, at least, get an idea of the average price of the dishes) – again not to short anybody out.
Hi KimHo – I think I’m along the same lines as you here. Generally the amount of tips I pay is dependent on the service I get so that would have some bearing on how much I pay at a restaurant that implements such a policy.
As for the overall price of the meal itself, I too, would be inclined to pay as close to what the list price normally is as well…it’s that fairness in all of us that would win out for the most part, I suspect.