Ontario bakery succeeds with honor payment system
Link (Thanks, Chris!)(Photo from MyWorldReviews.com) City Café doesn’t have Interac or accept credit cards. Neither will you see a cash register in the bakery. Instead, customers add up how much they owe themselves and drop their money into a fare box from an old bus.
“I liked the idea of simplifying things and ... the honour system made a whole lot of sense,” [owner John] Bergen says. “What irritated me about going into Tim Hortons, for example, was waiting in line for something as simple as getting a donut and a coffee. So the thought was, someone can pour his own coffee, grab his own bagel, cut it himself, throw the money in, and walk out. We don’t touch 60 per cent of the transaction.”
Because it is up to the customers to total their purchases, Bergen has simplified the cost structure.
“Everything is rounded off to the nearest quarter with taxes included where applicable,” he says. “So every desert is $1.50 (tarts, brownies, and date squares), every pizza lunch is $5, every beverage is $1.25, every loaf of bread is $2.75 (Italian sourdough, multi-grain, and raisin bread on weekends), croissants are $1 each, and bagels are three for $2 (plain, sesame, and multi-grain).”
The bakery conducts audits every six months and Bergen says only once did things come up short.
“Our theory is that two per cent of our sales are being ripped off. ‘Ripped off’ in the sense that there are people who forget to pay or they make a mistake in paying, and then there are people who deliberately don’t pay. And every so often we have to kick somebody out that we know hasn’t been paying,” he says. “But at the same time we figure we’re being overpaid by three per cent. Some people come in and want a $2.75 loaf of bread, but they see we’re busy so they throw $3 in and walk out. Or, although we discourage tips, some people still give them to us. But because the staff is paid well (the average wage is $15.50 an hour), the tips go into the general pot.”
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It doesn't really seem like a true honor system if they've kicked people out, does it? They've announced there are no rules, but then proceed to enforce them. . .
Still a good effort though.
They've announced there are no rules
That's an interesting extrapolation. They've set prices and left instructions on how to pay. How is that 'no rules'?
Well, you're sorta right, Project. A true honor system would be "pay what you think it's worth", like what Radiohead did with their last album.
Since this bakery is posting actual prices for their goods, how they collect is up to them. If someone is deliberately not paying the posted prices, the bakery has the right to remove them from the premises.
PS: the article contains no reference to support "they've announced there are no rules".
#1,
I didn't know "the honor system" was so well defined. They didn't say "no rules", you did. You do realize that rules are not inherently bad things, I hope.
Is this really news? I know in Germany and Austria there are fully-automated, honor system bakeries. If this single example doesn't convince people this can work, I'd advise another post on one of these bakery chains.
Well, you're sorta right, Project. A true honor system would be "pay what you think it's worth", like what Radiohead did with their last album.
That would be more like a tip jar, which might rely on the honor system, isn't the most perfect example of one. An honor system simply means that you expect a certain type of behaviour (in this case, paying the set prices for the things you buy), but we're not going to monitor you, we're going to depend on your honor to follow the rules. The honor system doesn't preclude happening to notice that somebody's breaking them repeatedly and enforcing them in that case (kicking out persistent freeloaders), or having specific prices.
Ha! I've been to this place once, purely by chance. It took me forever to get a coffee because I didn't know what to do!
But who do you complain to if you receive rude customer service?
My local baker is staffed by the most illtempered and foul mouthed old woman in Scotland,I would kinda miss the verbal cut and thrust of our early morning encounters!
#8: Wander the streets screaming and mumbling at nobody in particular.
If you do this enough, people will come up to you and give you money and/or paper bags containing sandwiches and cups of coffee.
My local baker is staffed by the most ill-tempered and foul mouthed old woman in Scotland
I can haz YouTube?
'Or, although we discourage tips, some people still give them to us. But because the staff is paid well (the average wage is $15.50 an hour), the tips go into the general pot.'
This statement seems quite confusing. Is the owner saying that, while tips are discouraged, they are still accepted, and are then just kept by the owner instead of being given to the employees for whom they were intended, because the staff is already 'paid well'? This would seem terribly dishonourable, which leads me to assume that I must be misinterpreting it.
Furthermore, listing a main phone number for customers and then intentionally keeping the voicemail full, while not allowing anyone to answer it, would seem most discourteous, as would describing those who make arithmetic mistakes as 'ripping off' the bakery, while apparently not offering any assistance with calculations when asked.
In theory, a honour-based store might be interesting, but from reading the article, I'm given the impression that the owner may have decided to use it as an excuse to be unpleasant, discourteous, and even possibly dishonourable. I do hope that I'm mistaken.
# 9 / #11
Yeh, there's nothing like a camera to reinforce the "illtempered and foul mouthed" nugget in anyone..
Video please! :)
#12, The "tips go into the general pot" statement sounds to me like the tips are split between the workers. I doubt they get all that many tips anyway. Canadians don't generally tip people for doing their job. Waiters get tipped but people behind the counter usually don't.
#13 - Although tips are discouraged because of the high wage, any tips they get are collected and divided amongst all the employees. I didn't interpret that the bakery owner was pocketing the tips, I think he was simply stating that patrons are not expected/encouraged to tip because that part of the wage has been compensated for in the generous salary.
Just a thought.
The text with "Or" suggests that tips are cycled into the bakery's pot - not the tip pool.
I'd like to see a followup from the bakery to explain this better.
@ #1-
Perplexing comment. An honor system does not mean one can operate dishonorably. It's just a system in which there are no formal mechanisms for enforcing good behavior.
I used to ran an "honor system" candy store at my workplace... people grab the candy I bought at costco, and put their coins in a box. I once did an inventory and found shrinkage of about 22%, which was about exactly my profit margin. This was within an suburban white collar USA office secured with guards and electronic id locks. It's sad that we just don't have the same ethical standards in the USA as in Canada where people are only now starting to lock their cars.
With regard to the tips, since there isn't a separate tip jar, and any tip would just go into the old bus fare box, there really wouldn't be any mechanism for sorting out tip vs non-tip income, so the tips would just wind up as part of the general revenue - essentially those who leave a tip wind up covering the tab of those who miscalculated or just took without paying, which seems like a decent system to me, in that it allows the owner to cover his losses, and thus is able to pay his workers a decent wage - one far better than your average coffee-shop employee pulls down, in any case. In reality, the "common pool" tip jar at a Canadian coffee shop is usually fairly marginal - the thing is a way to dispose of nickels and pennies. Heck, Canadians are all trained (in customer habits) by Tim Hortons, where tips are actively discouraged. That or by Starbucks, where the drink costs so damn much that I can bring myself to leave a tip because I'm now broke.
Auld Nora is mightily fearsome,has a ball peen hammer under her counter for,and I quote:"fur cunts that git wide an think they can rob ma pies"so Arkizzile yer spot on,but I do believe an element of subterfuge will be necessary to obtain footage but the gauntlet has been thrown.If I do not return,My parents will blame you Antinous.
I look forward to the Auld Nora videos. Perhaps one of her chasing you with her ball peen hammer?
Does she side with the Campbells or the MacDonalds?
This does seem a likely outcome,Douglas...
She sides wi anybody that disnae fuck wi er pies.
A simplistic and democratic view point that seems to serve her well.
Tip pooling, which this sounds suspiciously like, is illegal in California.
http://www.dir.ca.gov/dlse/faq_tipsandgratutities.htm
"The Legislature expressly declares that the purpose of this
article is to prevent fraud upon the public in connection with the
practice of tipping and declares that this article is passed for a
public reason and can not be contravened by a private agreement."
Tip pooling is legal. The owners or managers dipping into the tip pool is illegal.
Hassan-I-Sabbah you are my Scottish brother.
Antinous,
Sorry, I guess I misused the term without fully thinking about the meaning of "tip pooling."
I was looking for a short way of saying that an employer keeping tips, or any portion thereof, for itself is illegal in California.
http://www.leginfo.ca.gov/cgi-bin/displaycode?section=lab&group=00001-01000&file=350-356
Cheers sis!
Also, whether tip pooling is illegal in California or not is irrelevant, as this is Canada we're talking about. :p
-
Again, do any of you complaining about the boss skimming the tips actually see a tip jar there? There's no physical segregation of income, therefor, while the intent of a significant overpayment may be to "tip" the staff, there's no functional way to separate that portion of the income from the common pool, especially when someone else (even the guy behind you who, say, sees you leave a twoonie for a single bagel) underpays.
Also, on a general note, the addition of the "tip" step to the interac machines at coffee shops and other pay-first counter-service food joints pisses the hell out of me, because I'm being asked to pay a) before I've tasted the food, b) before I have empirical knowledge of how long it will take to get my food (ie, are the staff going to dog it for twenty minutes before producing my coffee), and c) when all the service I get is you ringing my damn order into the machine, with maybe 30 seconds of minimal interaction. I like to tip the staff, when things go right. I've left fairly massive tips before. I've also had waiters tell me jokes about Katherine Hepburn in a sex-toy shop. The counter staff, they smile. That's about it.
@ #8:
If you receive rude customer service at a self-serve, you should complain to your parents for not raising you properly.
The on-campus cafeterias here (Norwegian university) have a similar honor system for coffee; put the money in a bowl (and take change if you need), and help yourself to the coffee. Works wonders for the lines, at least.
honor systems give people a chance to feel good about themselves - and others. Why are they not subsidized and encouraged by governments?
It's in the owner's interest to say that the honour system is working well; future customers will be more honourable if they believe others have been too. If people feel that everyone rips off the bakery then they'd feel less bad about doing so too.
Thus; the owner saying the system is successful shouldn't be trusted without proof.
I wonder how the issue of change is sorted out. Maybe some people overpay or underpay because they don't have the right change and this balances out, but that seems unlikely.
It has a nice sentiment this one, but i get the feeling an honor system certainly wouldn't work in the area auld nora works in. There's just too many tinks out there willing to steal stuff the first opportunity they can. Kitchener Ontario must be a nice place.
the kitchener/waterloo area is full of nice folks, and i'm pleased that this works.
it is disheartening that when a story that is essentially "bakery is nice to customers, employees - trusts them." people assume there must be some sneaky sneaks lying to them and the boss is stealing tips and whatever.
next time i'm in the area i'll make a point to pay 5$ for a croissant.
@34:
I've been to the City Cafe Bakery. If you need change, you do have to ask one of the people working there. They'll give you whatever change you require, but you have to tell them what you want. Got $5.50 worth of stuff and you've only got a twenty? Tell the staff that you need $14.50 in change, and they'll give it to you.
You may have to wait a bit longer, because they're busy making the delicious stuff you're eating, but that's the price you have to pay for being able to get in and out in less than a minute if you've got the right change (or don't mind overpaying by a piddling amount).
#34: Felix, I think the proof is in that the bakery still uses the system. Who would keep doing it and promote it if it lost them money? Not every positive story has some sinister undercurrent of lies and misdirection. Sometimes, people working together honestly is just that.
FWIW I'm from the Kitchener-Waterloo area and am glad to see that the soul of the place is alive and well.
These people seem genuinely nice.
I wonder what they're up to?
I'm sure the reason this works and an honor system candy box at work doesn't isn't because of some difference between Canadians and Americans, it's because people are stealing from the candy box when no one else is in the room.
Integrity is doing the right thing when no one is looking. Peer pressure is a GREAT incitement to honesty.
I think there is an interesting parallel in the old maxim that phone companies could be equally profitable with flat rate billing because of the cost of operating a complex usage based billing system.
I'd be willing to bet that they actually come out ahead when you factor in the streamlining.
Customers doing it him/herself vs. the time for employees to perform the transactions.
They probably have a higher through-put of customers during peak times.
Unless the size of the place is too small or awkward when busy.
I know this has nothing to do with any sort of utopian state but i do have a bakery story. I was arrested in 1982 for being a punk rocker in a bakery - all i wanted was a pie (??) - Nora had nothing to do with this.
It doesn't sound like the bakery "almost never" gets cheated. On average they don't get cheated, because the occasional underpayment (deliberate or accidental) is countered by the occasional overpayment.
An honor system does not mean one can operate dishonorably. It's just a system in which there are no formal mechanisms for enforcing good behavior.
I don't think this is really the definition of an honor system. It's common for there to be fewer or no formal rules or enforcement mechanisms, but it's not necessary that there be none. There are several US universities that operate on some form of honor system, where complex rules about academic honesty and community behavior are boiled down into a simpler formulation based on honor and trust and common academic restrictions (such as taking exams only in an exam hall, supervised by proctors watching for cheating) are eliminated, but there are definitely 'backup' formal mechanisms in some of those cases for when violations are found, and I think those systems still deserve the name 'honor system'.
Clever use of consumer empowerment to cut down on transaction costs, overhead, and technological mediation. Wal-Mart's strategy taken to another degree, at a different scale. Unfortunately, it probably can't be scaled up very well - as I recall Communist police states extended to toilet paper rationing grannies in public WCs.
It seems like the store would benefit from installing a cheap calculator next to the drop-box, for the math-challenged.
I work at The Little Depot Diner in Peabody, MA and we do this with coffee and muffins to go. There is a pump pot and a muffin tray with instructions to drop a dollar in the oversized coffee mug on the counter. Very few people have ever left without paying, and most of them come back later or the next day with what they owe. We are across the street from a Dunkin Donuts (in Mass what isn't?) and people really seems to like this system since they don't have to talk to anyone to get their food. And our coffee is awesome.
They have a huge calculator next to the coin box.
I just can't understand how they do inventory and calculate their sales without a register?