Tipping in German restaurants

Abstract of the study

Existing research on tipping in tourism focuses on countries where a strong tipping culture prevails, such as the United States. This creates a gap in the understanding of tipping behavior in European countries such as Germany. In addition, the shift towards cashless transactions has reshaped consumer payment preferences in Germany and is influencing tipping practices. This study examines payment method preferences and differences in tipping behavior across different payment methods from the perspective of both consumers and restaurant staff in Germany. Interviews with 20 restaurant guests and 13 employees show that Germany functions as a society with a low tipping culture. Cashless payments are becoming the predominant payment method and are changing the tipping expectations of both customers and restaurant staff. In addition, the study examines the motivations and perceptions of consumers and staff regarding tipping in the context of predetermined tipping percentages. The results provide theoretical and managerial insights, deepen the understanding of how payment methods influence tipping behavior and contribute to the knowledge of tipping norms in Germany.

Key findings of this study

Low status of tipping in Germany:The study confirms that Germany is characterizedas a society with a weak tipping culture and thus a low willingness to tip. Tipping is seen as a relatively modest practice, with the average tipping rate typically only between 3% and 10%. Due to the fact that tipping is not traditional in Germany, staff are often not expected to tip.

Positive influence of cashless payments on tipping: Due to the more convenient processing, cashless payments, especially by card and cell phone, are becoming increasingly popular in German restaurants. Customers who pay cashless tend to tip more than those who pay cash, as the "pain of paying" is reduced. This shift is changing the traditional cash tipping landscape. Restaurant staff tend to expect higher tips from customers paying cashless as they assume they are less constrained by physical cash.

Service quality as the main factor influencing tip amount:Service quality (including friendliness, attentiveness at the table and food quality) is the most important factor influencing consumers' tipping intention and tip amount. Customers are willing to tip more than the average rate when they receive excellent service, which underpins the positive correlation between service and tipping. However, in contrast to the US, where tips are vital, the results of this study show that waiters in Germany maintain their service professionally even when tips are low or non-existent, as a minimum wage secures their income.

Predefined tipping rates are perceived as coercion:Most consumers perceive the suggestion of predefined tipping percentages on electronic devices as pressure or coercion to tip. Customers prefer to decide how much to tip themselves, without interruptions or prompts. Although these predefined rates can increase the likelihood and amount of tipping because they save the customer the calculation, too high a rate risks creating reluctance and losing customers in the long term.