Doing Business on the Honor System

Many adults remember growing up with the honor system. But can it work in the business world? Canadian business owner, John Bergen seems to think so. His Kitchener, Ontario-based City Café Bakery relies on the honor system. In fact, City Café doesn't accept credit cards and doesn't even have a cash register. Instead, customers add up how much they owe and dispense it into a fare box from an old bus.

"I liked the idea of simplifying things and . . . the honor system made a whole lot of sense," Bergen said.

In order to make the system work, Bergen has simplified the cost structure. So items are rounded off to the nearest quarter, with taxes included when applicable. Every six months, the bakery performs an audit. Since opening in April 2000, Bergen says the bakery has come up short only once.

Bergen says people will underpay, either on purpose or by mistake, while others will overpay if they don't want to wait for change. "And every so often we have to kick somebody out that we know hasn't been paying," Bergen said.

But according to Bergen, overall, the system works. Per week, the café and bakery sells about 3,000 bagels, 1,200 croissants, and 1,000 desserts. Bergen and his partners are interested in opening three or four more locations in the area, all integrating the honor system.

 







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