'Pay-what-you-want' restaurant in China losing money as customers choose to pay nothing at all

By James Griffiths, December 5, 2013

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A pay-what-you-want (PWYW) restaurant in Fuzhou, Fujian province has lost over 250,000 yuan ($41,000) since it opened due to unscrupulous customers taking advantage of the policy to get free meals. 

'Five Loaves and Two Fish', named for the Biblical tale, is open 24 hours a day in central Fuzhou, serving seafood and local Fujianese cuisine. Diners are expected to clean their own dishes after eating and then put whatever amount they wish to pay into a box. However, according to investors, as many as 20 percent of customers choose to pay nothing at all, costing the restaurant hundreds of thousands in the process. 

“We initially expected the restaurant to stay open for two months, and now it has lasted three. The losses are not unbearable,” owner Liu Pengfei told China Daily.

In an interview in October with local television news, Liu said that "what we care about most is not money, but trust". He plans to encourage patrons who don't pay to explain their reasons why not. 

"They can tell me they don't have enough money, that's fine. But paying nothing and saying nothing is totally different," he told the paper.

"Honesty is the first step to building trust. In my eyes, those who don't pay are sick."

Several of Liu's customers who spoke to the paper were positive about the restaurant's payment policy. 

"Paying is based on the trust, so is washing the plates," said Yang Xiuqin, who visits almost daily. "You ought to wash them well so other customers won't worry about hygiene."

A woman named Feng Wei said she takes her 6 year old son to the restaurant so "he will learn to be honest and pay for what he takes, even though no one asks him to. 

In one of the few large scale experiments conducted on the PWYW system, researchers found that the policy can deter some customers, because "individuals feel bad when they pay less than the 'appropriate' price." This does not seem to be a problem in Fuzhou. 

[Image via Flickr]

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