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Tip Over?

Things to think about before adding a tip jar to your place of business

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This story appears in the February 2005 issue of Entrepreneur. Subscribe »

Tipping etiquette has long been debated in the service industry, but there's a new source of contention: tip jars.

From Starbucks to independent donut shops, tip jars have popped up to the delight of employees, but what effect does it have on customers? Business psychologist Larina Kase understands the issue from both sides of the counter. Now the president of Performance and Success Coaching, a small-business consulting company in Philadelphia, Kase was also one of the pioneers of the tip-jar era, placing one at her father's ice cream shop in the late 1980s. Patrons were intrigued by the jar. But the tip jar is no longer a novelty, and Kase says that it has psychological effects on patrons. "Patrons can feel uncomfortable when there is a tip jar for services they feel do not deserve a tip," she says.

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