By the end of the first quarter of this year, nearly 1,000 waiters and bartenders in the country have joined the new Lithuanian digital solution for tips.
According to ASHBURN International (included in Penki kontinentai Group), a payment service provider for the country’s largest banks and retailers, the average tip amount in the capital’s cafes and restaurants is gradually increasing. Last year, the average tip size in Vilnius catering establishments was about 2.5 euros, while in the first quarter of 2023, it has already exceeded 3 euros. From 2022 to the first quarter of 2023, the average amount spent per restaurant visit changed by only one euro, from €20.90 to €21.90.
These figures are provided by the developers of MyTips, a solution for tracking tips in cafes and restaurants. By the end of the first quarter of this year, nearly 1,000 waiters and bartenders in the country have joined the new Lithuanian digital solution for tips.
Martynas Vildziunas, the owner of Lola breakfast restaurant in the center of the capital, says that a year ago about 30 percent of restaurant customers paid by card, and 70 percent by cash. After the pandemic, this ratio has shifted in favor of cards: at the restaurant managed by Martynas, 70 percent of customers now pay by card, and only about a third in cash.
According to the entrepreneur, in Lithuania, it is customary to leave a 10% tip from the order amount, but this figure is gradually increasing. Some waiters, who are particularly popular with customers, manage to collect up to half of their salary, and sometimes even a second salary. “I think that now this percentage from the bill can be about 15,” says the restaurant owner. M.Vildziunas has long been looking for a digital solution for tips.
“In our restaurant, there are many foreigners who have already gotten used to leaving tips on the payment terminal. In the United States, for example, a waiter brings a payment terminal to the customer where they can choose the amount of tip to leave – 10, 15, or 20 percent of the total amount,” Vildziunas explains.
According to him, the jar or tip box that often stays at the bar is increasingly empty today, and customers are choosing more modern ways to show their appreciation for service. “As a student, I worked as a waiter myself. I know what it’s like when you do everything possible for the customer, and they pay by card and don’t leave a tip because they don’t have cash on them. But now our waiters have the incentive to try even harder because they know that regardless of whether they pay by card or cash, they will be appreciated,” Vildziunas says.
Waiter Nikita Frolov echoes him: “Most of the customers I serve no longer carry cash. When the opportunity to leave a tip with a bank card appeared, the number of tips almost doubled, so for us bartenders, this new solution really does work.”
Frolov notes that Lithuanians are still reluctant to offer tipping via card. “Foreigners visiting Vilnius often ask about this option, and Lithuanians are more conservative on this issue. We often have to remind them about the possibility of leaving tips on the payment terminal. But when they get used to it, they even leave more than the standard 10% of the bill. So we are very happy with this innovation,” says Frolov.
MyTips solution is personalized: each waiter, after registering on the ASHBURN International website, sees real-time statistics on when and how much they received in tips, and can thus monitor the effectiveness of their work. In addition, they do not have to pay income tax (in Lithuania, tips are considered income and are taxed). “ASHBURN International”, which has the appropriate license, will help you pay income tax and fill out all tax declarations for the waiter or bartender.
Transparent digital tracking of tips also allows additional revenue to be collected into the state budget. According to some estimates, if all tips in Lithuanian cafes and restaurants were officially tracked, the country’s budget would receive an additional ten million euros per year.
Currently, the new way of leaving tips is already being used by a restaurant of chains such as Manami, Sugamour, Charlie pizza, Katpėdėlė, Brussels Mussels, and others.