IS CEC NOT DOING AS WELL THESE DAYS?

[TreyTX]

So I was doing some research, not related to CEC but came accross this article...is CEC not doing as well as they have in the past? Maybe a reason they are cutting cost (curtains, etc). I really think they have alienated all customers accept children under six. Mother's are forced to go to the place. I really think they need to get back to basics. When they started the whole "Where a kid can be a kid" campaign in 1985 they still had games that older kids (6 and up, and fathers) liked to play. I think when DZ came around they thought they had to joint their business but Mc Donald's started placing Playplaces in their locations and sold Leaps and Bounds to DZ...their Sky Tubes are no longer special to them. Their pizza recipe has gotten so bland over the years. If they don't get it together there could be major competition in chains such as Red Robin. Like I said I found this article that shows their profits...what do you all think? I am sure that corporate CEC people read this forum (secretly)...though they might think they know all the answers or that lower people on the totem pole might not be significant they might want to watch out. There is nothing special about CEC anymore...you can buy animated singing (CEC's original point of difference) Santas at Walmart now and play in tubes anywhere...

www.technomic.com/facts/top_100.html (http://www.technomic.com/facts/top_100.html)

rank: 57 Chuck E. Cheese's $532,160,000 '04 sales

[captslappy]

Trey, I agree with your comments 100%. We have talked about CEC's future in several other threads and Shiney Happy Jenn commented the place is a house of cards ready to fall. I see a number of problems. While Dick Frank has been awesome with turning CEC around since the days of PTT the times are changing and CEC is failing to adapt to them. While as a fan, I dislike many of the changes over time, it was in the company's best interest. They need to start changing directions however quick and soon.

Here are some problems I see:

1. They have narrowed the market too much and by over specializing they are losing a larger market.

2. Videogames have gotten so much better now. Back in the day home systems weren't the same as the games you played at an arcade. That is no longer true.

3. Redemption prize games are everywhere. There are lots of adult places that do the same thing with out the animatronic show.

4. The market is flooded with family entertainment venues now, many are much more diverse than CEC. Again, CEC is pretty much gone to a 6 and under market. My friends took their 2 year old there. They are not CEC fans and wanted to see what I saw in the place. They were not impressed. I had to go through a big long explanation about what Showbiz and Pizza Time used to be. I think many parents feel the same way.

5. The magic is just gone. The shows are mostly run down and dumpy looking, the curtains not working makes them look even more run down (the average person doesn't know the whole back story on them being disabled. Only we CEC geeks understand all of that). Even if everything else looks good, a store with a bad show makes the whole place seem dumpy. Then there is the 2 CECs on the floor at once thing.

6. Bottom line, aside from a run down show that keeps getting worse instead of better and a person in a rat suit, CEC is no longer anything special and I truly believe the public is beginning to lose interest especially as the kids in their target market outgrow the place which happens quickly.

[pizzacam]

Hahaha, Luby's #89 man you can really tell! It should be lower!

[TreyTX]

yeap...here are the big problems that I see right now which might not be reversible.... just like Krispy Kreme...CEC has to listen to it's stock holders and CEC has to grow it's business. You would think they would have learned from it's past. Krispy Kreme is closing stores left and right...selling their item's in local grocery stores...this has made their product not very exciting anymore...plus Dunkin Donuts (which has recently been purchased) cost so less to open and operate.

1. They originally closed small town stores throughout as these stores were money loosers. Now they have reopened them up in the same town...with the same concept (i.e.: Victoria, College Station, Waco, TX ---Waco is in the same small strip center as the former SBZ/CEC franchise was located about 4 doors down...now that closed CEC is a gym...so why does CEC think now they will make it? Also, many small towns have competition such as Mr. Gatti's Gattitown which offers the same games as CEC plus larger games for older patrons plus they have a buffet that has the perception as being cheaper than a CEC visit. How do you compete with this?

2. SBZ/CEC closed down stores that used to compete for another location's business as well as closed corporate stores that competed with the franchisee's business (when SBZ and CEC merged). Now they are opening stores that compete with each other again...i.e.: Houston, TX has stores in Sugarland that competes with Stafford...Katy, Memorial and Houston Copperfield compete for the same business...Woodlands and FM 1996 compete...as does Pasadena and Gulfgate...

The above situations really can't be changed now...and I am sure this is starting to happen all over the US. It will be very interesting to see what happens in the future.

A couple of years ago Mc Donald's took a gamble and had each of their stores and franchised location spend big money of it's "Made for you" concept where the kitchen was revamped and now their food is mostly made to order...this hit them very hard finically but now their sales and stock does (domestically) very well.

I am sure that everyone thinks Burger King's food is horrible but go try them soon...they have been bought out by a new investment company and they are closing unprofitable stores as well as starting a similar concept as Mc Donald's has done. Their is only so much money to be made in the burger business especially as company such as Jack in the Box and Sonic are on the huge growth...when one succeeds another will fall...there is only so much money to be spent on burgers.


What do you all think about the situation that CEC is in now and what possibilities do you think they should try to improve? We all love the show but the show no longer brings customers into their locations and it's true that video games at home are just as great as ones you can play commercially. Why does CEC not care their stores sit vacant on weekdays and only have some business at night during the week?

[captslappy]

I think too much expansion is a problem for any business. That was one of the many factors back in the PTT days and seems to be a problem now. In the "heartland" of CEC terrority, Dallas, we have CECs on every corner since corporate is here. They are almost all cookie-cutter identical now and are the first to get renovated. I think we have 2 two stages in the entire area. All of our 3 stage stores are gone. There are just too many here in the DFW area. I remember when TCBY yogurt was the thing. We saw TCBY on every corner. Now 80% of those stores are gone now. I see CEC doing the same thing. I think the biggest mistake that will continue to lead to CEC's demise besides too much expansion is the cutting corners thing. They have stripped themselves of what makes them unique from other places. I don't know how soon we'll see the ultimate demise of the chain but I believe the concept is doomed in the long run. I wouldn't be suprised if someone bought them out in the long term and eventually shut the whole chain down.

[PuroMax]

Actually guys, to me these numbers don't look bad at all... Chuck E. Cheese's primarily serves pizza. If you look at the list, there are only 4 restaurants in that brand segment ranked above CEC. Then take into consideration the amount of carry-out/delivery business done by these restaurants (nearly all of it, save Pizza Hut) Then look at the change vs. the previous year, where CEC is +nearly 10%, a better increase than ALL of the pizza restaurants that are doing "better" than it is.

I'm not making myself out to be a naysayer, but CEC is not a dying fish. It is a powerhouse frontrunner in an obsolete concept. There is no national chain of video arcades, it's an impossible business. In order for "family fun centers" to stay in business they need to be massive, multi-faceted monstrosities of activity just to pull in enough people to stay afloat, and if you've ever been to one of these, they are typically very dirty and undesirable because of the amount of crap that they need to accomodate to be profitable.

I know we all love the show on this board, but let's get real. Kids get all hyped up about their birthdays/special nights out. They don't want to sit down and watch a damn show. That is what televisions are for. When the idea was first implemented there were maybe a dozen TV channels? No Nickelodeon, no on-demand. You'd watch cartoons on "Channel 4!" Personally, I think the showroom should include a dance floor. The next big remodel should be geared toward making the experience much more "concert-esque". Kids want to run around and cause a ruckus.

My view on cannibalism... There are enough options game-wise in the concept that if done correctly, every CEC you visit will be a slightly different experience. Is this capitalized on? Hardly, but different locations do have different presentations of the same show. And in the market I'm in, more stores would be a good thing. New York City is so colorful and diverse that you could operate probably 3 CECs in Manhattan alone with tremendous numbers, and there isn't even 1 there yet.

[YoungCaliHottie]

theres no cecs in manhatten??? wow...

well i definately hear what youre saying. good job looking at the #s differently.

at first glance i would also think there are too many cecs here. my zipcode is 90242. type that into the cec site. there are 8 cec's within 10 miles! around here thats only 10 - 15 mins of driving. eight of them!!! now change it to within 30 miles. THERE ARE 23 CEC's WITHIN 30 - 45 MINS OF MY HOUSE! Yet, they seem to be doing well.

I don't know the exact numbers. But I know Bell is usually the top in sales. Yet there are 7 other CEC's within 10 minutes of it. On Super Bowl Sunday morning, I wanted to go to CEC. I tried Bell first. I've never see a line so long! It was over an hour wait to get in! So then I tried Lynwood, the next closest. It had a 30 minute wait! Lakewood also had a wait! Finally I stayed at Cerritos, since they only had a 10 minute wait.

My point... theyre all close, I would have thought CEC was nuts, but they were all packed. Now that's not the normal situation with long waits. (And I especially thought Super Bowl Sunday would be slow since everyone shoulda been watching the game.) But we'll just have to trust that they know what they're doing most of the time.

Today I found out the new Glendale store supposedly has games that no other CEC has. So I'll have to check that out!

Oh yeah... and what are those numbers on that report anyways? A single store does more sales than that in a year. Maybe that was average per store sales? In which case you would times it by like 500! Or was it profit from sales? Profit in a corporation can be a confusing word. Was it money left after dividends? Was it the dividends money itself, after other profit was budgeted for other investments?

[Rapid T Rabbit]

Personally, I think the showroom should include a dance floor. The next big remodel should be geared toward making the experience much more "concert-esque". Kids want to run around and cause a ruckus. ... There are enough options game-wise in the concept that if done correctly, every CEC you visit will be a slightly different experience. Is this capitalized on? Hardly, but different locations do have different presentations of the same show. And in the market I'm in, more stores would be a good thing. New York City is so colorful and diverse that you could operate probably 3 CECs in Manhattan alone with tremendous numbers, and there isn't even 1 there yet.

I like that "dance floor/concert idea" ! It would give the company a reason to make the character appearances central to the guest experience again for all ages, and not just for the younger kids having their birthday parties in the place.

Diversification of individual stores within a given geographical area makes sense too...it would change the landscape for the better whereby locations in proximity to each other would become complementary instead of competing against each other for the same customers. Sort of how individual theme parks within a "chain" (such as Six Flags, Disney, Cedar etc.) have differences that make each worth a special visit in turn. Theme park companies even issue season passes that are cross-honored among all their properties....maybe CEC could offer something like that, a special prize or food discount (since admission is "free").

Puro, funny you mention how Manhattan NYC could support 3 CEC's...they were originally thinking of opening up 2 that were going to be just half a mile apart (Times Square and Herald Square) ! Of course that was before they decided to build a store uptown in Harlem instead.

[VegaNova]

What a great thread with intelligent comments! I really love hearing everyone's point of view here, both the positive and negative - and I agree with most everything that's being brought up here.

Here's my take (forgive me if I'm repeating what I've been saying before).

#1 - CECE seems more focused on oversaturating the market than improving on their in-store product. Why invest the $$ to make a better product, in turn making each store increase profits, when you can just open a new stores down the road that'll bring in profits of their own. This'll work as long as people stay interested and have the money to blow on an extravagant evening out with their toddlers, but when the economy starts hurting you'll start seeing why it's bad to be slapping duct tape on a problem that needs some serious repair work. Those mass closures that have been talked about above... that could happen.

#2 - Lack of competition. This is something that I whole heartedly believe in, because I use this theory in my daily life. Competition is a good thing, it forces people to improve, innovate, and fight to stay alive. CECE really has no competion anymore, they've either run out or bought out anyone who posed a threat. So why should they bother trying to be better anymore - better than who? Instead the focus now is to cut costs, streamline their empire, and plant these cookie cutter stores anywhere that'll let them build them. To better their concept will cost money that won't immediately increase profits (similar to Trey's McD's example above) - but that's what's called preventative maintinence! In fact I have a CECE propaganda-employee training book that states something along the lines of 'an ounce of prevention is worth a pound of cure' - they need to start thinking this way at the executive level.

Sorry for the rant, but I truly believe in this. This website has no competition anymore (sorry for anyone else who has a CEC/SPP site because there are a few) but really there's none. So basically I could just sit back and not bother doing anything or adding anything new. But I don't... partly because I care about what I'm doing and also it's a good way to snuff out competition before any springs up. You shouldn't have to be improving what you do just because someone else or some other party is forcing you to become better.

-VegaNova

[captslappy]

I agree a lot on the no competition thing. It's really hurt things and I think they have gotten away from a lot of what made the place unique. Again, mainly talking the show here but also in other areas. I also think they have too narrow of a target now.

[RodHouTx]

There is some big competition popping up here in Houston and surrounding areas. A place called "Incredible Pizza". There is one close to the Sugarland store, and one in Conroe. They are huge buildings.

They are not only getting CEC guests, but staff and techs too :eek

Welcome to America's Incredible Pizza Company, where Nothing Tops our Pizza but the Fun!™ Here you'll find an incredible all-you-can-eat buffet and choose to eat in the sporty Gymnasium, the cool Drive-In Room, fun retro 50s Diner or the quiet Family Room!

Then, hop into some fun at the Fairgrounds, where you'll find indoor Go-Kart Races (with real trophies!), Bumper Cars, Route 66 Mini Golf, an incredible Arcade where you can redeem tickets for great prizes, Adult and Junior Bowling, and much more!

www.incrediblepizza.com (http://www.incrediblepizza.com)

[pizzacam]

Hmm, sounds like Celebration Station, I know they have one in Mesquite(Dallas area) I went once...didn't eat(food looked nasty) but it was fun... I think there was one in the Houston area but they started closing left and right. I know the one closest to me in Austin folded. I did film their show though in Dallas!

celebrationstation.com/ (http://celebrationstation.com/)

[cec080]

i can't agree more! i think cec is a sinking battle ship. maybe i was too harsh with the battle ship reference. anyways i went to this location last night and boy it was rotten. no one at kid check the place was a mess too many games down >: >: why don't cec take care of the locations it has currently open then wait a year and open new one's.. also from a worker standpoint my dad said he's not sure if there going to keep maintence workers for long. he's doing kid check more than cleaning. all in all i must say i think 2006 is a rebuilding year for cec. look at last year with all the remodels. that should have told us that hey were not doing to well so were gonna move in a different direction. clean up some of our older stores and really push for the future. i know at this store i work for they still have prizes left that were made like 3-5years ago. yet the manager won't clearance them out. i just don't know. sometimes i wonder.. but hey no talk of ch11 or any head people leaving. i think it's time for a change at cec and i think the head guys can handel it. but one things for sure this don't care never mind attitude some of these cast members have that needs to change! remember the more people spending money the longer you'll have a job. i just heard again that in Michigan the unemployment rate rose again in January. all in all good luck cec i'm sure things will get better! :D

[captslappy]

I am not sure that they are headed in the direction of bankruptcy like in 83-84 and they may be doing well finanancially now, but I will say they need to do a massive restructure and look at once again doing an overhaul of the direction, target and image. I also think from a show standpoint its time for another concept unification of everything in the system. As I proposed in another thread, I think all existing 1, 2 and 3 stages need to be redone using just the CEC figure only. If the newest studio C figure is only 8 movements there should be no problem using the cyberamic CEC bot. That will cut down on maintenance time and costs, make everything a little more uniform (which equals less money and more profit) and it will help deal with shows that look completely ghetto-fied!

[RodHouTx]

Another thing to keep in mind is that things vary store to store, city by city, and region by region. Some complaints you have about one store are not valid at another. One store may scale back on something, while another store is increasing it. Some managers try to do everything "right", while some may be more lax or because of sales just have to cut labor. Even though corporate would like to, they can't control what happens in the store every minute of they day. They'd have to put robots in the store for that. :lol

[cec080]

good summary rod! i totally agree with that! also remember it's not only cec look at the big 3!

[dheineCECfan]

Surprised Chuck E. Cheese's didn't make the Top 40 of the 100 best restaurant chains!

[pizzacam]

Dude, why are you surprised? Oh, wait when was the last time you actually went? It's changed a whole lot since 1994.

[CEC3066]

according to his pictures the last time he went was 2002

[YoungCaliHottie]

i wonder if that chain has anything to do with Johns Incredible Pizza? Theres a few of them out here. Look very similar to the link you posted. I went to Johns Incredible Pizza and it was very boring. You HAVE to buy a buffet or you can't get in. The food is mediocre. (CECs food is way better). And the games cost a rediculous amount. Skeeball is like 80 cents or something. You never even know how much you're really spending because they use the rechargable cards that have the "points" system! You buy like a million points for x dollars, and they give you z amount of free points. Then the games are like 982.73 points each. You never know what anything costs! lol. Then in the end you spent like $40 on games and $25 on food/admission for two, and you leave with a tootsie roll and a ruler. CEC is way better value for the money and a lot more enjoyable. Plus we complain about the condition of the stage a lot... ...well at least CEC has a frikken stage! Johns Incredible Pizza has no show! Just different "themed" rooms with TVs. One room plays music videos. Another room plays Sponge Bob. I can make a 99cent frozen pizza that tastes better than their crap and watch sponge bob at home. I'll save $64!

The three main things that keep CEC better... The strong brand name/mascot, the pricing (all games are 1 token/admission is free), and the show! Those are the 3 things that differentiate CEC from the competition. Lets hope they realize this and improve the stages soon because that is the one thing out of those three that is lacking the most. (CECs food is also better. But I didn't list that as important because you dont go to amusement centers because you expect fine dining.)

...oh, and i dont agree with the cu2.0 thing. it wont make anything better. you would think that if a store has one bot only, then surely they can freakin keep that one bot going. but its not true. most studio c's around here are in terrible shape. correct me if im wrong, but they seem to require more maintenance. and i think the random movements thing is affecting studio c bots more. common studio c problems around here... chucks foot stops tapping. eyebrows stop moving. wrists dont bend or bend too much. mouth stops working properly. ...many are like this already. so contrary to what one would normally think, no... cecs wont even take care of the stage if you cut it down to only one damn bot. that, and having the whole gang is just so much more entertaining. i noticed studio c cecs around here have more of a tendency to turn the music down. and they give lame excuses like "thats as high as it goes" or "im not allowed to change the volume".

ok... enough of my babbling... lol...

[CEC3066]

thats as high as it goes" or "im not allowed to change the volume".

BULLS**T!:rollin

[sungun12]

my store is waaay up in sales :D

chuck e has been around forever. its not going anywhere. there will always be kids and there will always be chucke. name one other restaurant thats made it this long. and i mean restaurant, not like, mcdonalds. its not comparable. name one themed restaurant that has an age range of like 2-8 that has made it over 25 years. go ahead and try. chuck e will be around for a lot longer

[MMBBfan327]

Enchanted Castle has been open for awhile now.

[CEC3066]

my store is waaay up in sales

that's because your store has the BEST GM working there And even though you may be a rookie GM it sounds like you've got your ship together! GO MISSY! YOU #1 in my book

[YoungCaliHottie]

my store is waaay up in sales

i bet it could go higher with the right supplier


...hey, that rhymed. lol

[sungun12]

ohhh my robbie, the second i can worry about saving money instead of trying to keep my $hithole gameroom from staying working, employees who come in late or call off constantly and running great shifts, (not just good ones, or just barely good ones) that is first on my list.

its been better since leah is here, a LOT less stressful. give me one more month for both of us to really work with the other mgrs, tech and cm, and we will hook it up. dont worry.

oh i was sooo up in sales and CP in Jan, first time that store has been above scale in a year....

piece of cake ;)

just wait til this month, im in the running for #1 in the district

[CEC3066]

and I bet the store that's #1 in sales in your district now will soon be saying "WT??? How'd we drop to #2????":rollin

[YoungCaliHottie]

no, theyll be like "WTF! #2 TO... ...CHARLESTON!?!? WTFWTFWTF!!!" lol

missy, say hi to leah for me. tell her all about me! since ill be moving in with u and working for ya soon. haha jk. but tell her i sed hi :)

[CEC743]

I always thought the problem had something to do with the fact that you can go to any regular pizza chain and get a large one topping pizza for something like ten bucks instead of the CEC 16 dollar large pepperoni...the nice little 20 cent difference in the kids and regular cups is a nice suggestive selling point but it turns people away from wanting a drink at all it's that expensive, not to mention they're like "can i have a cup for water" when you know that they're going to be drinking the stuff that isn't water. I just cringe at the thought when I hear parents saying "omy, 17 dollars for that?", how many slices is it? what it's only ...i mean, Chuckecheese is just like the education system ...you have your big wig, principal, or corporate officer, driving around in their miata, or beamer, or whatnot, wearing the nice expensive something or other, while you're closing down schools, and raising pizza prices...when does it stop? when there is no one left to teach? or when there is no one left to hire? when there is no one left to graduate? when there is no one left to fire?( to cut costs) Enough of me on my soapbox...

[YoungCaliHottie]

around here if u ask for a water cup they give you a small cone shaped cup. people dont usually bother using them for soda cuz theyre a pain and u have to keep holding them cuz they wont stand up.

[CEC3066]

< IS CEC NOT DOING AS WELL THESE DAYS?>

YES! proof: ripping out nostalgic shows the fans go ga-ga over for Studio C.