Sandwich Shop Leaves Bill Up to Diners

At a restaurant in Kirkland, Wash., diners pay what they think the meal was worth. NPR's Susan Stamberg talks with the owner of the Terra Bite Lounge about his "pay what you want" coffee and sandwich shop.

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SUSAN STAMBERG, host:

This is WEEKEND EDITION. I'm Susan Stamberg. Coming up, treating the wear and tear of banging on piano keys and bowing cellos.

But first the Terra Bite Lounge in Kirkland, Washington, probably looks like a fair number of other cafes where you can get a good cup of coffee, a sandwich, a piece of pie. Two things are missing, though: a price list and a cash register.

Customers decide for themselves how much to pay for their meals, or they may not pay at all. Ervin Peretz started Terra Bite two years ago. He's on the phone with us. How does your pay-what-you-want system work, sir?

Mr. ERVIN PERETZ (Founder, Terra Bite Lounge, Kirkland, Washington): The way it works is customers do what they would do at any other cafe or deli. They order their coffee, and then they move down to the side of the counter, where they can discretely pay into a slot in the counter.

STAMBERG: And what made you decide to start a cafe with this kind of voluntary payment? I will bet there's a philosophy behind it.

Mr. PERETZ: There is. In our area, there's plenty of free food available for someone who's down and out, but there's a lot of stigma associated with receiving free food. So what we wanted to do is look into removing the stigmas, and that ties in with just making the whole experience more pleasurable and convenient for the mainstream.

STAMBERG: Why would it be more pleasurable for them?

Mr. PERETZ: Most of our clients are mainstream, upscale clientele, and they can come in and pay out of convenience, say at the end of the week. There's no standing in line, receiving change and all that, and it just feels more like being served at home.

STAMBERG: What's the breakdown between what you call mainstream, that is people who could afford to pay printed prices, and the homeless or other people who come because they need free food?

Mr. PERETZ: Oh, as far as actual homeless people that live in Kirkland, I can probably count them on one hand, but there's the working poor, people who are in debt, people who might not be making rent that month.

STAMBERG: Have you found that your customers are more or less honest than you expected? If most of them pay, are they paying fair price?

Mr. PERETZ: Well, they pay less than they would if we were charging. So per customer, we make less, but then we're also very efficient.

STAMBERG: I must say that some people might feel just so valued, people who can afford it, but would feel so trusted and valued by this policy of yours.

Mr. PERETZ: Exactly. It's a warmer feeling, and the thing that they appreciate is that we're not a charity. We're not trying to educate them and giving them a sense of obligation to do something different than they already do.

STAMBERG: Thank you very much.

Mr. PERETZ: Thank you.

STAMBERG: Ervin Peretz is the founder of the Terra Bite Lounge a cafe deli in Kirkland, Washington, where you pay what you think is right.

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