Page 66 - BCM July 2024
P. 66

MARKETING








              Mr./Ms. Proprietor, Come on Down!


              You’re the next contestant on ‘Getting the Bowling Price Right.’


                   hoosing the correct pricing for a center is one of the   pro  tability. But we can’t really do it that way.
              C most important jobs of a proprietor. I would say it’s   Let’s look at a snack bar item, such as the notoriously
              the most important, but I put building your customer   expensive chicken wings. You could raise your prices high
              base ahead of pricing.    e two go hand in hand and have   enough to meet your cost-of-goods target. “Yay! We met
              a direct impact on each other.                      our cost of goods target!” you may proclaim. However, if
                             Supply and demand is a real thing. If you   you did it by selling virtually zero wings, that might not be
                           have high demand, you can charge more.   a win.
                           As you charge more, demand will drop. If   Gross margin is di  erent than cost of goods. If you sell
                           the increase in price outstrips any loss in   six wings for $8, your cost of goods is 45% (not great).
                           demand, you will be more pro  table. Be-  However, your gross margin is $4.40. Compare that to
                           ing more pro  table is fun.            what you would make if the guest chose an alternative
                             However, this is not something you can   to wings. Also compare that to the guest not making a
                GREG       do forever. If you do not build or at least   purchase at all. I know they will probably choose another
               PERKINS     maintain your customer base, eventually   menu item, but not always.

                           you’ll be down to zero customers. Once   If selling an item like wings doesn’t make sense for your
              you get down to zero customers, pricing decisions don’t   center, at least at this time, take it o   the menu.    at’s
              matter that much.                                   better than shocking your customers into thinking you’re
                Nonetheless, let’s talk                                                      way overpriced. I’ve done
              about the importance of                                                        this and it’s stupid. Get
              pricing and how it can                                                         the best price you can
              lead to being more pro  t-    Centers that are open play based                 get without alienating
              able and having more fun.      have an easier time increasing                  your guests. Incidentally,
                In today’s in  ationary                                                      it’s getting harder and
              environment, we must be       prices because casual customers                  harder to alienate people
              diligent about constantly    have no idea what they should be                  these days based on what
              reviewing our pricing.      charged in an entertainment venue.                 fast-food restaurants are
              Our vendors will go up on                                                      charging.
              their pricing like clock-                                                        Eighty percent or more
              work; that much we can                                                         of food-and-beverage
              count on. Most traditional centers (mine included) are   purchases today are credit card purchases. I just made
              reluctant to increase prices.    e reason can be explained   that number up, but I’m pretty sure I’m right.    e idea
              in one word: league bowlers. I know that’s two words, but   that people don’t think at all about what anything costs
              I’m running for re-election this fall.              when they use a credit card is true.    at has been my
                Centers that are open play based have an easier time   experience from waiting on customers. If it goes on their
              increasing prices because casual customers have no idea   credit card, they don’t bat an eye.
              what they should be charged in an entertainment facility.   Nowhere is this truer than in the bar. I have the occa-
              But they think it will be a lot.    at’s what I think, anyway.  sional drink or two, and I’m always astounded by what
                If you run a center with a large league base, you’re go-  I’m charged. People who want a drink will pay more than
              ing to hear it when you raise prices. Suck it up. We have   you think. I’m not saying to rip o   people; just charge
              to do it and, in truth, most of your league customers will   what everyone else is charging… and they’re charging a
              understand.    ey see what’s going on with in  ation all   lot.
              around them.    ey will give you less pushback now than   One theory for pricing is that you should always round
              has historically been the case.                     up to just below the nearest 50 cents. If your shoe rental
                Cost-based pricing is a method that’s usually used   is $3.29, it could probably be $3.49 and nobody would
              by manufacturing companies — companies that make    notice. In most cases, people will round down. If my wife
              things.    ey   gure out what their costs will be and set   buys something for $399, she’ll tell me it was around $300.
              their pricing to achieve the margins that will maximize   (I’m just kidding; my wife is perfect and she’s my editor.)

              64  •  BCM  •  JULY 2024                                                               www.bcmmag.com




         064,065_Marketing_0724.indd   64                                                                      6/13/24   11:26 AM
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