Man reveals the real reason why tipping culture is getting out of hand and hits the nail on the head

People are going crazy over the unreasonable tipping culture in America. Even the people pleasers who can not sign off their payment without leaving a hefty tip are now having a wake-up call. The purpose of tipping even at self-checkouts puzzles people the most. To break down the reason behind the out-of-control tipping culture, Matt Epstein–who goes by @matt_epstein on TikTok–made a video that went viral for the right reasons. In his usual style, Epstein unraveled some unknown facts about business strategies and it is insightful.

"Ten years ago, when you were getting your morning coffee, you weren't berated at the end with the flip of a screen with the question we all know and hate. 'Would you like to leave a tip?'" began Epstein, pointing out today's reality. Highlighting how every business, even in the case of self-service, asks customers for a tip, the content creator delved into his reasoning. "So this machine that essentially makes you feel bad if you don't leave a tip is built and produced by this company called Toast," Epstein said. He mentioned that the company offered the payment equipment we see on the counters to restaurant owners for free. It included the high-tech iPad, talent, card reader and so on, which would normally cost up to $3,500.

But there's a strategic reason behind giving those expensive equipment for free. "Toast's business model charges three percent of every single transaction that goes through one of the machines," he said. While explaining in layman's terms, Epstein indicated that whenever a customer pays $100 on the machine, $3 would go to Toast as a processing fee. Now, this is just for one customer in one restaurant. Imagine the myriad of payments that happen in restaurants across the country. If you're wondering what it has to do with tipping culture, Epstein explained, "If a customer leaves a tip, Toast makes more money." 

Epstein also emphasized that Toast worked its way to normalize tipping and make the process smooth. "One of the ways they do this is by making tips default for all restaurants and making you, as a restaurant owner, have to sort through hundreds of pages of documentation to figure out how to turn tips off," he said. So, as per his analysis, the country had grown to despise the tipping culture, which was once accepted well because of this company's business strategy. With nearly 173K views, this post garnered attention on the internet, with hundreds of people ranting about how tipping on tablets was insane.

"I will never tip on one of these devices. A tip jar? Sure. But not giving my money to that company," commented @sharpm112. "I always tip, it brings me joy, so I keep cash. NEVER tip on cards if you want the person who helped you to get the full tip," wrote @budsis5. "I tip where it applies. If you have priced your service already and I am not getting any extra, then I won't tip. But if there's extra work put in, that is the point of gratuity. But there should be no pressure like this. I do not like this concept of places asking to leave a tip," commented @badddlys.

You can follow Matt Epstein (@matt_epstein) on TikTok for more business news and strategy videos. 

This article originally appeared on 2.23.24.