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Exploring Global Tipping Practices: A Look at How Much People Tip in Different Countries

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The Differences in Tipping Culture around the World: What Travelers Need to Know

The Role of Tipping in the United States

In most countries outside of the United States, tipping is seen as a small gesture of gratitude. However, in the U.S., tipping has become almost obligatory. This is because tips make up a significant portion of workers' earnings in industries such as entertainment, food service, and hospitality. In fact, some workers in these industries are paid less than the minimum wage because they are considered "tipped employees."

Tipped Employees and Minimum Wage

Under federal law, employers in the U.S. can pay tipped employees as little as $2.13 per hour, as long as the tips they receive bring their earnings up to the minimum wage. This primarily applies to restaurant workers, although other employees who receive more than $30 a month in tips may also qualify for this lower wage. However, some states are now increasing the minimum wage for tipped employees or eliminating tipping wages altogether. While there are other workers who receive substandard wages, the majority of those affected are waiters and bartenders.

The Impact of Tips

For tipped workers in the U.S., tips can boost their wages by approximately 25%, according to data from payroll platform Gusto. However, this varies depending on the specific industry and job. In contrast, in other countries, workers do not rely on tips for their income, and gratuities remain as tokens of gratitude.

Tipping Expectations around the World

Before traveling abroad, it's essential to research the tipping customs and standards at your destination. It's also advisable to carry both cash and credit cards to ensure you can tip appropriately. Here are some tipping expectations in popular travel destinations:

Paris, France

In Paris, a service charge is already included in the bill at restaurants. However, it is customary to round up the total or leave a small additional amount as a gratuity for good service.

Puerto Vallarta, Mexico

In Mexico, it is customary to leave a 10-15% tip at restaurants. Some higher-end establishments may include a service charge, but it is still customary to leave an additional tip for exceptional service.

Tokyo, Japan

Tipping is not a part of Japanese culture and is generally not expected. In fact, leaving a tip may be seen as rude or implying that the service was inadequate. Instead, it is best to show appreciation by saying "arigatou" (thank you) or offering a small gift.

Cape Town, South Africa

In South Africa, tipping is customary. The general rule is to leave a 10-15% tip at restaurants, with some establishments automatically including a service charge. It is also customary to tip hotel staff, taxi drivers, and tour guides. It is important for travelers to respect tipping customs and adjust their behavior accordingly when visiting different countries. By being aware of these expectations, you can show gratitude for good service while also being culturally sensitive.

Conclusion: How Tipping Culture Impacts New Businesses in the Travel Industry

Understanding tipping customs around the world is not only important for travelers but also for businesses operating in the travel industry. The differences in tipping culture can have a significant impact on new businesses, especially those catering to international tourists. Here's a hot take on how this topic may affect new businesses: 1. Adapting Business Models: New businesses in the United States' food service and hospitality industries, where tipping is almost obligatory, should take into account the reliance on tips when designing their business models. This may involve adjusting employee compensation structures and ensuring competitive wages in order to attract and retain talented staff. 2. Training and Education: Businesses should prioritize training their staff on appropriate tipping practices across different countries. This will help prevent any awkward situations where guests may feel obligated to leave a tip in cultures where it's not expected, or where a lack of gratuity may be perceived as rude. Providing cultural sensitivity training can enhance the overall guest experience. 3. Catering to Cultural Expectations: For businesses that operate in multiple countries, understanding and respecting each country's tipping customs can go a long way in building rapport with customers. By adjusting their approach to tipping, businesses can make a positive impression on travelers and potentially earn repeat business. 4. Marketing and Communication: When targeting international tourists, businesses can leverage their knowledge of tipping customs as a unique selling point. By highlighting their understanding of local customs and providing relevant guidance to customers, businesses can position themselves as knowledgeable and trustworthy, ultimately attracting more customers. In conclusion, tipping culture plays a crucial role in the success of new businesses in the travel industry. Adapting to and respecting the customs of each country can help businesses build strong relationships with customers while ensuring a positive guest experience. By being attentive to tipping practices, new businesses can position themselves for long-term success in the international travel market. Article First Published at: https://www.cnbc.com/2023/07/12/how-much-people-tip-in-the-us-compared-to-other-countries.html

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