Without gratuities there is less hospitality

By Scot Herrick | Cube Rules Commentary

Mar 30

Las Vegas is built on workers who make their money on gratuities — the tips we all leave for waitresses, bartenders, cab drivers, hotel doormen and more. Gratuities are the reciprocity that fuels the hospitality business.

Last week Kate and I took a week-long trip to the glittering city in the desert and we had a great, if tiring, time. After braving the forty decibel din of constant advertising, noise in the casinos and street hawkers pushing their postcards of escorts for sale, Kate and I would find a quiet place and contemplate life with the help of Mexican refreshments.

In the quiet, the conversations with the waitstaffs were frank.

Gratuities drive income

In those conversations, we’d ask how business was in the neon-lit city. We’d hear the stories of 20% fewer cab rides from the airport. Of half the gates at the airport not in use any more. Of $35 room deals in luxury hotels. The most telling story ended with this statement:

People still love their entertainment and want their fun. But they are not tipping the people providing it.

It was easy to see, too. A local place on the strip was offering $2 beer. Customer after customer would order the cheap beer — and leave nothing for the bartender. Seriously, you can’t afford a buck tip for the beer when the beer is only $2?

Now 20% tips are no longer happening as often. Now it is 10%. Or less. Or nothing. We want our service, but not willing to pay the people who are providing it.

Business in Las Vegas only wants your money

It is clear that the business of Las Vegas is driven by money. Big casinos want to get the money out of your mind and just play with chips. Chips are not money in your head — you can’t keep track of your money as easily as with cash.

Hotels don’t want you to see your bill until you are home. They want you to keep your credit card open with them your entire stay so you can easily just “charge it to your room.” And when you don’t leave your credit card open (we didn’t) they still add on $100 for incidentals to your room and then take it off when you check out. The in room mini bar is charged by weight — as when you pick something up to look at the label, you get charged for the item on your bill. When you check out, you can simply sign your card and have them mail you (not e-mail you, snail mail you) your itemized statement. And you can even check the box that says to not bother with the itemized statement; just pay the bill — whatever it is — with your credit card.

The entire business model in Vegas is driven to separate you from thinking about money, counting your money or seeing how much your visit really costs.

Yet, gratuities drive hospitality

That’s the business model. When the business model meets the customer — us — it is through the people in the hospitality industry that make their living from a small salary and many tips. And the hospitality workers in Las Vegas are tireless in ensuring you have what you need while you are there. It didn’t matter who the person was we were interacting with while we were there, every person was attentive, likable, and wanting to do the very best job they could for you.

But the lack of tips is taking its toll. On our last day, leaving for the airport, the person who got our cab exchanged some chit chat with the driver and noted that “It’s been a rough day. Tough crowd.”

Sure, all those tourists leaving town on their reduced fair airline tickets in their package deal room going to the half-priced shows and having this guy put their heavy luggage into the trunk of the cab — and paying him nothing. After a while, it bites the attitude of the most tireless hospitality worker providing us a service.

Of course, this is happening to service providers everywhere. We go in for the deal and then deal out the person doing the servicing of the deal. Ask the waitstaff at your local restaurant how their tips have been. Same work. Same effort. Less money.

While you’re enjoying the deal of a century thought up by some marketing person, save some cash for the person in front of you delivering the service. You’ll make a bigger impact on the economy — and the hospitality person — if you do.

Have you been tipping as much lately?

Photo by irene.

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About the Author

Scot Herrick is the author of “I’ve Landed My Dream Job–Now What???” and owner of Cube Rules, LLC. Scot has a long history of management and individual contribution in multiple Fortune 100 corporations.