Restaurateur and multimillionaire Danny Meyer says he doesn’t believe in obligatory tipping on takeout orders. The Shake Shack founder shared his take on the changing attitudes around gratuity on CNBC’s “Squawk Box” on Thursday.
“If you’re just taking out food, and it was just a transaction — I give you money, you give me a cup of coffee — I don’t think there’s any obligation to tip whatsoever,” he said in the interview. Meyer, who also founded Union Square Hospitality Group, now serves as chair of Shake Shack’s board.
Dubbed by some experts as “tip-flation,” consumers are being prompted to tip at checkout at more and more establishments via digital point-of-sale (POS) systems to contend with rising inflation, shipping costs, and employee wages.
In fine dining or full-service restaurants, Meyer said that tipping is necessary and more widely accepted by customers.
Shake Shack locations currently use Toast as their POS management system, which offers guests the opportunity to tip on each order. In 2015, the fast-casual chain announced that employees could no longer accept tips, a decision that was reversed during the pandemic as customers returned to in-person dining.