The first Exchange Buffet (“E & B”) restaurant opened in 1885 on New Street, near the New York Stock Exchange. The restaurants operated on the honor system—patrons took food from the buffet tables, then told the cashier what they had taken.
 
The system was called “eat ‘em and beat ‘em” (or “eat it and beat it”), after the “E & B” name. Most customers were honest, although some did “beat ‘em.” The Exchange Buffet went bankrupt in 1963 and the term “eat ‘em and beat ‘em” is no longer used.
 
   
Antiquarian Booksellers’ Association of America
(New York City) Early New York City Exchange Buffet
Newark, New Jersey Whitehead & Hoag Very Good Early plastic “tag” from the Exchange Buffet “Pioneer of the Buffet Lunch System” announcing the opening of another Restaurant at No. 625 Broadway near Houston Street; the E. B. established 1885, lists 13 branches, at 78 Walker St, 45 John St., 95 Liberty St., 69 Pine St., 22 New St., 37 Broad St., 46 Broad St., 36 Beaver St., 90 Beaver St., 11 Murray St., 354 Broadway, Hudson Terminal, 625 Broadway; 3” x 7 1/2” size plastic tag, hole punched in one end; printed three colors; light wear, overall, very good condition.
Price: USD 20.00
 
Google Books
14 December 1922, Printers’ Ink, “Building a Six-Million Dollar Business on Trust: Chain of Metropolitan Restaurants Starts Advertising Regularly after Establishing a $6,000,000 Business” by James True, pg. 110:
“The idea on which we have built had its genesis in the New York Stock Exchange in 1885. The first Exchange Buffet was started in New Street, opposite the Stock Exchange in that year. Practically all of the patrons were brokers who were familiar with ‘change trading. There, as you known, all offers are made and accepted verbally, and they’re as good as gold.”
 
10 July 1937, Xenia (OH) Evening Gazette, “In New York” by George Ross, pg. 4, cols. 6-7:
Others’ Honesty Pays
In a town of such conglomerate character, where every man is suspicious of his brother-native, the consistent success of such an enterprise as the Exchange Buffet Restaurants is not much short of spectacular. The Exchange Buffet is that place where a New Yorker may enter cheerily, take whatever sustenance he chooses from a variety of counters, eat and drink to his heart’s content and add up his own check. At the cashier’s cage, he only has to state the total sum of the bill he’s run up and pay with a pristine-clean conscience. it’s been working splendidly for years.
 
The Exchange Buffet hasn’t lost much money because of chisellers. A restaurant operating along similar lines, in the vicinity of the New York Harbor is named Sleburg’s and draws its major clientele from the trucksters, teamsters and longshoremen in the neighborhood. Being brute fellows, an outsider would gather the impression that Sleburg has to watch them pretty carefully. Not at all. The cashier testifies that only once in 200 instances, does a patron deliberately falsify his addition; and there are some so scrupulous—that they add an additional nickel to their own calculations in order to be on the safe side of their consciences.
     
Google Books
The Pan American
vol. 9—1948
pg. 45:
To one of the “Eat it and Beat it,” the Exchange Buffet Restaurants, where you don’t get the check, you just tell the cashier how much you owe — and pay. of…
     
Google Books
The City
By Julius Horwitz
Cleveland, OH: World Publishing Company
1953
Pg. 156:
Only the verbal contract of the market place. You tell the man at the cash register, 55c. he yells out, 55c. Nobody asks what you ate. “Eat ‘em and beat “em,” maybe. But here at lunch time the great drama of credit is enacted — who knows, the “55” for stew and coffee can mean 55 shares of ...
 
9 November 1963, New York (NY) Times, pg. 22:
CAFETERIAS BUILT
ON HONESTY FAIL
Exchange Buffet, Which Let
Customers Use Honor
System, Is Bankrupt
By John P Shanley
The Exchange Buffet Corporation, which for 78 years operated a chain of cafeterias on the honor system, has filed a petition in bankruptcy.
 
Founded in 1885, the Exchange Buffet chain—wags used to say that the initials stood for “eat ‘em and beat ‘em”—issued no checks to customers.
 
Patrons would select food from counters and eat at tables or at high stand=up counters. On their way out they would tell the cashier what they had eaten. The cashier then would tell them what they owed.
 
At one time the cafeterias were regarded as a symbol of man’s fundamental honesty. but, a spokesman for the corporation said yesterday that the policy of trusting customers probably had contributed to the concern’s financial troubles.
(...)
The last of the honor-system cafeterias closed on Oct. 25 at 41 East 42d Street, where it had been for more than 40 years. 
 
21 August 1964, New York (NY) Times, “Time for lunch? Not on Wall St.” by Vartanig G. Vartan, pg. 40:
And several generations of Wall Street brokers recall with fondness the “eat ‘em and beat ‘em” cafeterias that trusted customers under the honor system without checks. The last of these exchange buffet units was closed nearly a year ago.
 
20 April 1977, New York (NY) Times, Letters, pg. 55:
Exchange Buffets
TO THE LIVING SECTION:
In any discussion of nostalgic dining in New York, there should be mention of the Exchange Buffets. Strictly functional in decor, they offered adequate to exceptional lunches—with a unique advantage. As I recall, sandwiches and perhaps soup were available to be eaten, standing at wait-high tables.
(...)
The Exchange Buffet logo was a large EB in a circle. But it was not the monogram that won Exchange Buffets their more familiar title “Eat’em and Beat’em.”
 
No one ever received a check at E & B. You went to the cashier and told what you had ordered. Almost everyone had a “ham on rye and coffee”—35 cents. Many had indeed enjoyed a full turkey dinner—$1.25.
 
They were invited not to return. For, even in those more innocent times, the citizenry was not completely trusted. There were “spotters” to keep hungry office boys in line.
ROBERT A. FALLATH
Merrick, L. I.
   
1 July 1977, Bennington (VT) Banner, “Memories of that first job” By Edwin A. Roberts Jr. (The National Observer), pg. 5, col.s 3-4:
NEW YORK.
(...)
When I didn’t bring a brown bag I usually lunched at the cafetria known as the Exchange Buffet, often called the E & B. The Exchange Buffet had been in business for decades but it exists no more. A possible reason springs to mind. you entered E & B and helped yourself to the laid-out food. Then, after the food was consumed (and thus rendered useless as evidence), you told the cashier what you had eaten. She had to take your word for it. it was the honor system. The E & B was sometimes known as “Eat-em and Beat-em.”
 
30 September 1979, New York (NY) Times, “The Markets” by Vartanig G. Vartan, pg. F17:
Wall Street brokers with long memories fondly recall a string of downtown cafeterias that once did business under the corporate title of Exchange Buffet Inc. The company’s popular nickname, however, was “Eat ‘Em and Beat ‘Em,” derived from the chain’s practice of using the honor system whereby customers told the cashier what victuals they had consumed.
 
Exchange Buffet has long since closed its doors, but a select list of publicly-owned cafeteria stocks continues to flourish.
 
20 August 1983, New York (NY) Times, “Singer Story Filmed Cafeteria-Style” by Richard F. Shepard, pg. 9:
“There is something very dear about all this. I (Howard Da Silva—ed.) used to write scripts in The New York Times cafeteria. I remember the Exchange Buffet, the Eat ‘em-Beat ‘em places, and I loved them.”