Topic:Restaurant Tipping

Presented by:Miranda Lazar & Kristyn Kelly

2003 sales at restaurants totaled $151 Billion

Assuming 15% tipping, waiters and waitresses earned $22.7 billion in tip income

Research shows that tip percentages are weakly related to customers’ rating of service quality

Tips may be influence by many factors• Size of the party• Table location in the restaurant• Gender• Smokers vs. non smokers• Time of the day (Lunch vs. Dinner)

Restaurant located in a suburban shopping mall

Server collected data during an interval of two & a half months• Gender (0=male, 1=female)• Smoker (0=no, 1=yes)• Day of the week (3=Thursday, 4=Friday,

5=Saturday, 6=Sunday)• Time of day (0=day, 1=night)• Size of the party

Manager believed that the data would provide a means of assessing what sorts of things affect tips and whether they were seen as objective

Total bills range from $3.07 to $50.81 Mean of Total bills = $19.79

$50.81

$3.07

Men

May be skewed do to more men were apart of the research than women

157 men vs. 87 women

SAMPLEHYPOTHESIS

TESTShyp

valuesample mean stdev sample size

for the meanREF

=average() =stdev() =(n)

NULL : Null statement  

ALTERNATIVE: Alternative statement

test statistic (obs)

=standardize(sample mean, ref value, std error(stdev/sqrt(n))

critical measure

=normsinv(1-signif level/#tails)

one-tailed or two-tailed? 1

|OBS| > CRIT?

p-value=(#tails)*(normsidst(abs(obs)))

-level 0.050

p-value < -level?

HYPOTHESIS TESTS

hypothesized value sample mean stdev

sample size

for the mean

3.00 3.09 1.49 157

NULL : Men are better tippers than women  

ALTERNATIVE: Men are not better tippers than women

test statistic (obs) .7540843

critical measure 1.6448535 one-tailed or two-tailed? 1

|OBS| > CRIT? no

p-value 0.225

-level 0.050

p-value < -level? no

ACCEPT THE NULL

Men are better tippers than women!

HYPOTHESIS TESTS

hypothesized value

sample mean stdev

sample size

for the mean 3.00

3.10 1.44 176

NULL : people tip more than the average tip at dinner time

ALTERNATIVE: people tip less than the average tip at dinner time

test statistic (obs)

0.94836

critical measure

1.64485

one-tailed or two-tailed? 1

|OBS| > CRIT? no

p-value 0.171

-level 0.050

p-value < -level? no

ACCEPT THE NULL

People tip more than average at dinner time!

Gender of patron has an influence over the amount of tip• Men tip an average of $3.09• Women tip an average of $2.83

Time of day has an influence over the amount of tip• Lunch tip average $2.72• Dinner tip average $3.10

Little or no influence over tip amount• Day of Week

Sat & Sun tend to have larger total bill=larger tips

• Average Total Bill Sat & Sun larger total bill

• Smoker vs. Non-Smoker Very little difference $2.99 avg. vs. $3.00 avg.

• Size of Party

Have servers alternate from lunch and dinner shifts so there is more opportunity for equal tip earnings.

Because average total bills tend to be larger on weekends equaling larger tips, also alternate days of week that servers work for opportunity to earn equal tips.

Add gratuity to the bottom line or explain that gratuity is not included.