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Tipping at Starbucks

Should Starbucks Ditch the Tip Jar?


We've been following Starbucks CEO Howard Schultz in his publicized efforts to improve the company and its stores. In just the past month or so we've heard about the decision to nix breakfast sandwiches, test the $1.50 cup of coffee, the free WiFi arrangement, and witnessed the commitment to retraining its baristas to make the coffee the best it can be.

A writer at the Wall Street Journal suggests that getting rid of the tip jars by the registers could be a more meaningful step than the ones that Mr. Schultz has taken. He argues that "the tip jar subsidizes the company's payroll costs" and compares contributing to the tip jar with making a donation to Starbucks. The writer adds that to maintain its quality staff, the company would have to boost employees' wages without the tip jar.

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