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New research uncovers new service charges added for pouring pints, and pub-goers are actually in favour of it
4th June 2024, United Kingdom: The average cost of a pint in Britain could tip well over £5 for the first time in history as latest research reveals the introduction of new service charges as restaurants and pubs try to bounce back from tough times.
The research report, based on 2,500 hospitality businesses, staff and customers to gain insight into the UK’s tipping culture, uncovered how 74% of the hospitality industry will apply a service charge as standard for pouring pints and making cocktails. 22% of these already charge a tip while 52% plan to add a charge of up to 10% for the service, pushing the current average price of £4.75 for a pint to over £5 in some places for the first time.
Those living in the Home Counties, Northern Ireland and the capital could bear the brunt of these changes. In London a pint will cost you at least £7.15, with a 10% tipping charge, followed by Belfast (£6.71) and Brighton (£6.60). The three cheapest cities in the UK for a pint will be Wrexham (£2.20), Bangor (£2.42) and Dunfermline (£2.97)**.
These findings, commissioned by hospitality technology brand three rocks®, follow reports that in the first three months of this year alone, a staggering four licensed premises closed a day. This is down from eight a day the year before according to data from CGA by NIQ and AlixPartners as hospitality attempts to recover from the post Covid lull.
Punters in favour
The survey suggests that British pub-goers are in favour of this more Americanised style of tipping, where 20% is the standard gratuity for all types of service.
According to three rocks findings, nearly three quarters (73%) of Brits believe people should tip when buying drinks at a bar, with a third (34%) saying bar staff should get at least 10%-20% gratuity.
The research also found that 61% of Brits believe hospitality workers should get all of their tips without their employer taking a cut. A further 41% would increase their tips if they knew staff weren’t getting 100% of the money while 1 in 10 believe tips should be abolished, completely with employers expected to pay more to support their staff. Despite this, just a third of hospitality businesses currently give 100% of tips to their staff, while 42% of employees working in British restaurants, bars, pubs and clubs have never been told if their employer takes a cut of their tips.
From October this year though all UK hospitality businesses will have to distribute 100% of customer tips and service charges to staff, with no exceptions other than standard-rate tax deductions, under the Employment (Allocation of Tips) Act 2023. When asked how much it would cost to give staff 100% of tips, one in five businesses claimed it would increase their annual costs by £60,000-£360,000.
Scott Muncaster, founder and Managing Director of three rocks®, said: “The UK hospitality industry has been under immense pressure in the last few years. Beginning with the pandemic, then one of the biggest labour and skills shortages in decades, and now the cost-of-living crisis, operators need all the help they can get.
“Tipping has long been a sticking point for customers, staff and businesses, with many not knowing what to expect, what to give, or how to spread tips out among employees. It’s encouraging that customers are supporting the industry, however once the Employment (Allocation of Tips) Act 2023 comes into force, no hospitality business will be able to benefit from tips.”
For a full copy of three rocks®’ ‘Tipping Point: How new legislation will impact hospitality report’, visit: HERE
Notes to editors
The study spoke to hospitality businesses of all sizes, from independent traders with 1-5 employees to national chains with locations across the UK.
* https://www.ons.gov.uk/economy/inflationandpriceindices/timeseries/czms/mm23 - Average cost of a pint in the UK as of April 2024: £4.75
** https://www.numbeo.com/cost-of-living/
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About three rocks®
three rocks® is a people-first tech company specialising in creating solutions that enhance experiences. The company has over 30 years of collective experience in designing bespoke technology solutions driven by data collection and analysis, helping to transform businesses by enhancing consumer, employee, and user experience.
The brand’s experience management solution (XMS) is truly modular, allowing clients to utilise flexible solutions that are right for their business needs. The individual solutions include booking, ordering, inventory, CRM, strategy, kitchen management and business management. XMS is flexible and can be tailored to suit any industry.
three rocks® work with some of the UK’s largest restaurant brands such as Pizza Hut, TGI Fridays and The Big Table Group. Beyond hospitality, the brand works with B2B clients across a multitude of sectors including; wholesale, publishing and Internet of Things solutions.