Things not going well with the DDP changes

[skater]

I believe they vastly understimated the number of guests who would use the dining plan, who would return to WDW on a regular or semiregular basis in order to use the dining plan, and who would order the most expensive items they could find in the restaurants.

I remember they used to sell that Cinderella slipper dessert in CRT itself, as part of the dessert menu. When the dining plan came out, practically everyone who went in there ordered it. It was not meant to be a mass ordered item, as it takes time to make and the ingredients are expensive. That's why you now have to order one separately and ahead of time if you want one.

And everyone has to pay taxes. Not everyone has to buy the dining plan, or even travel to WDW.

Good points. The first year we used the DDP my DD ordered that slipper and I remember feeling a little guilty like we were getting away with something - and that was the free DDP in Sept. Again, the reason I won't pay for the DDP is because it is no longer a good value or convenient for my family. When we get it free, we don't have to worry about getting our money's worth, so we can use a credit for a character breakfast or order the cheapest item on the menu without feeling like we're "losing" money. I am going down for a short trip in two weeks and am so glad I didn't purchase the plan - I feel so free! I am eating breakfast at Kona, lunch at Le Cellier (I may just order an appetizer and desert), and dinner at Boma. If I was paying for the plan, I would feel like I had to eat dinner at LeCellier and not use Kona for a DDP credit.
I am not really upset about the changes because we normally get it free in Sept., but I also won't swallow some of the lines I've been given about it. One example is a management level (I think) CM who gushingly told me that the 08 plan was going to be such a great deal at $1 less than 07. And I wouldn't necessarily be thankful if they raise the price $4-5 just to put back in there what we used to have.
Overall, its really not a huge deal to me - but it is fun to discuss it here!

 

[Disneysnel]

Everyone has brought up some very good points!

I just cannot for the life of me figure out WHY they did not just leave it the same and raise the price.
Raising the price is something we would have expected to happen.
It sure would have saved so many problems and from the tone of this thread, would have made a lot of people happier.
Including me.

It seems that after a few years you would be working the kinks OUT of the program rather than adding more into it!

 

[missymj]

I've just looked at this thread, and it has been viewed over 25,000 times alone just from this one site. Can you begin to imagine what Disney Management reactions may be if over 25,000 comments via email or phone regarding the unsatisfactory changes to the DDP were forwarded. I find it hard to believe that Disney's mindset to the consumer would be either to purchase the DDP or not! That doesn't seem to be the "magic your way" approach of settling this issue rather it seems it is "magic our way", and here is a buck! Your thoughts?

 

[hipchickie]

I agree, I think the better way to word it is that Disney was losing PROFIT due to the old DDP, not actually losing money.

Still not really true, since what they were "losing" in profit they would make back by volume and efficiency - not only by higher volume buying of food costig less, but better efficiency for kitchen staff.

Plus, people always point to the cost of a table service dinner meal as a loss leader, but don't consider the extremely high profit margin of snack items. And just because a few people on the Dis tried to maxmize the value of the plan, there are just as many (and I am positive way more) people that did not use all the credits or did not use them as efficiently.

I have noticed that the people who say Disney was losing money have really no idea how food service runs.
Honestly, do you really think that if it was losing money, the plan would have remained in its previous incarnation for as long as it did?

 

[TLSnell1981]

Marketing will just come up with another hook.....one more controllable....and less expensive.

 

[Brian Noble]

I just cannot for the life of me figure out WHY they did not just leave it the same and raise the price.

Cutting the number of courses from three to two decreases dine time, and increases the number of seatings you get in a meal period.

I have long suspected that this is why DRC would always ask you if you were on the Plan when making an ADR---I suspected that Plan ADRs took the table out of the availability matrix for a longer period of time.

 

[kaytieeldr]

I was just looking at my 2008 Brinbaum's "official" guide for WDW, and the DDP info lists the 2007 info, saying that appetizers and tips are included with TS meals. There is also no mention of the deluxe plan. The 2008 Pass Porter, which is an "unofficial" guide however, is up to date.

Check the publication dates. I think Birnbaum's comes out in July or August - but remember, it's compiled before that. The Passporter usually comes out in December or January.

 

[fey_spirit]

Expected but not required.
And yes I tip - but I'm a stickler for literal answers.

Tipping is expected in the U.S.

 

[fey_spirit]

You know if you're going to stiff your server, at least have the gumption to do it without hiding behind false pretenses. Be a "man" about it. (and by you I mean anyone who would fake surprise in order to cover the choice not to leave a tip.)

Can anybody answer my question--do you actually receive information about the 2008 DDP after you buy it??
What I'm trying to establish is if all of those complaining were actually given wrong or erroneous information, or were simply lazy and didn't check what WAS given to them. Or worse, well knew the new policy and simply decided to save even MORE $$$ by not tipping. And cover that up by displays of mock outrage over the new policy.

 

[fey_spirit]

The problem is that for those who are on a tight budget, this is a little too late to do anything about it. They need to be informed while they're still at home and can do something to prepare - not once they are already there and can't adjust.

I'd be careful on that one, that is probably a stretch to say "most." I do agree with much of your post, however.

Since you have to stay on Disney property to purchase the DDP, the CM at check-in should just look to see if the people are on the DDP and advise everyone that there are some changes in 2008. It would take all of 5 seconds and avoid the "sticker shock" at the first TS meal. This solution is just too simple....

 

[tloft]

Still not really true, since what they were "losing" in profit they would make back by volume and efficiency - not only by higher volume buying of food costig less, but better efficiency for kitchen staff.

Plus, people always point to the cost of a table service dinner meal as a loss leader, but don't consider the extremely high profit margin of snack items. And just because a few people on the Dis tried to maxmize the value of the plan, there are just as many (and I am positive way more) people that did not use all the credits or did not use them as efficiently.

I have noticed that the people who say Disney was losing money have really no idea how food service runs.
Honestly, do you really think that if it was losing money, the plan would have remained in its previous incarnation for as long as it did?

What is your background in food service exactly? If you believe the spike in volume from the DDP caused the nation's largest food provider (Sysco) to drop prices to the nation's single largest food buying client you don't know much either. Disney is a contract buyer. I assure you that at any time their prices are already the lowest anywhere. What exactly is "efficiency of staff" - 8 hours in the kitchen is 8 hours in the kitchen and costs the same - period. If you mean sales volume went up, then this demands a correlative increase in staffing - which increases the overhead. Could you conceivably push out a few more apps or entrees per man hour worked - possibily, but not to make a significant difference in profitablility.

What exactly is it that you believe? Do you really believe that when cost analyzed the DDP was wildly profitable both directly in the restaurants and in additional benefits to resort booking and keeping guests in the park longer but that greedy, evil corporate big whigs can never get enough so have tried to trick everyone into buying a new plan that is grossly deflated in value. Do you think no one at Disney corporate offices had even the most fundamental grasp of economics, and they thought they could just slide these changes past the buyers with no ramnifications?

Of course not! Has it occurred to anyone the Disney wants less people on the DDP? People whine that they wish they had just raised the price. They did - and they called it the deluxe plan. And, regardless of the required gratuity, the DDDP offers a potentially higher discount than the old plan if maxmimized. However, Disney knows far less people will bite at a $70/day dining plan - meaning less headaches in the long run.

You also seem convinced that more people than not were using their credits inefficiently. I think if you'd worked in a restaurant much you would know that the second you start a special nearly everyone looks for ways to abuse it. If you do not spell out every term and restriction imaginable you will be fighting with customers constantly. On top of that, there is another sizeable group of customers who will read the rules but disagree on principal and try to scam the system anyway.

As far as I can tell you refuse to acknowledge that the restaurants would have suffered a reduction in profitability. I don't know how to begin to argue with that point of view. Even if 100% of the plan money went to the TS restaurant, how can accepting $39 for a meal with an average of check over $60 (tax and gratuity included) not be a reduction in profitability? This scenario would still be 35% discount (regardless of how low Disney's costs are - this is still a reduction in profitability plain and simple). The DDE is only 20% off, costs $75, and is only available to pass holders and residents (I believe). If they were making out like bandits on the DDP you think they'd be handing out DDE cards like Photopasses.

As for the increase in volume lets do a little math. Lets assume a restaurant pre dining plan did a $5000 dinner. Lets assume DDP brought in 20% more business - the quick assumption would be that they did $6000 now. If none of the preexisting diners used the plan you are now doing $6000 in sales but only collecting $5650. However, if 20% of the preexisting clientele find out about this fabulous DDP then suddenly you are still ringing $6000 in sales but only collecting $5300. From my understanding talking to numerous servers a majority of diners over that last few years have been on the plan. I have no way to put any kind of accurate percentage on it, but I am fairly certain that disney restaurant were busier than ever - and had very little to show for it.

 

[hipchickie]

Well lets see, I have a B.S. in Food service management, as well as 18 years in the industry...what did you say your qualifications were again?

The point is not that any *particular* restaurant may be losing money, but that the food service of Disney as a whole was making money.

If the reality is that a restaurant can fill its tables at all times and make a smaller profit off each table, vs. not filling to capicity and making a larger profit of the tables it comes out in the wash. Add in the higher profit of every other aspect of the plan (CS + snack) and overall the plan makes money. In addition, it keeps people on property spending money in other venues as well, which has always been an obvious target of the plan. You are saying you know better than everyone at disney whose sole job it is to compute the profitability of the DDP?

Obviously you have no idea how a kitchen works if the simple concept of increased hourly productivity with increased volume is so foreign to you. Furthermore, the fact that you don't think that Disney gets a better deal on foodstuffs with increases in volume shows your general ignorance of the industry

 

[tloft]

Well lets see, I have a B.S. in Food service management, as well as 18 years in the industry...what did you say your qualifications were again?

The point is not that any *particular* restaurant may be losing money, but that the food service of Disney as a whole was making money.

If the reality is that a restaurant can fill its tables at all times and make a smaller profit off each table, vs. not filling to capicity and making a larger profit of the tables it comes out in the wash. Add in the higher profit of every other aspect of the plan (CS + snack) and overall the plan makes money. In addition, it keeps people on property spending money in other venues as well, which has always been an obvious target of the plan. You are saying you know better than everyone at disney whose sole job it is to compute the profitability of the DDP?

Obviously you have no idea how a kitchen works if the simple concept of increased hourly productivity with increased volume is so foreign to you. Furthermore, the fact that you don't think that Disney gets a better deal on foodstuffs with increases in volume shows your general ignorance of the industry

19 (first job washing dishes at age 14) years in the business and I own my own restaurant - but what would I know.

How am I saying I know better than Disney? I'm the one saying I think Disney did what is right for Disney. You appear to be the one who seems to believe that we have been fundamentally wronged by inept disney decision making and have a better idea what they should have done.

I , and others, stated that while DDP obviously had positive impacts on Disney as a whole it obviously hurt the restaurants on an individual basis. Another poster. went so far as to say that even if they weren't losing money they were less profitable. YOU wrote "still not true" and implied that the restaurant alone, on an increase in volume were offsetting the discounts forced on them by the plan.

I also think I was quite explicit that I know disney gets massive discounts on their food - due to volume. I just don't believe for a second that DDP made big enough a difference in their food ordering to further lower those prices.

As usually happens on these boards (please join a tip discussion sometime) no amount of illustrating your point and providing a basis for your argument can't be met with some good old fashioned knee jerk ranting.

 

[hipchickie]

20 years in the business and I own my own restaurant - but what would I know.

How am I saying I know better than Disney? I'm the one saying I think Disney did what is right for Disney. You appear to be the one who seems to believe that we have been fundamentally wronged by inept disney decision making and have a better idea what they should have done.

Oh, I forgot, I owned my own restaurant too, as well as currently owning a food service business.
And oh yeah, what are you talking about???? I feel I have been fundamentally wronged? Where did you even get that?

I , and others, stated that while DDP obviously had positive impacts on Disney as a whole it obviously hurt the restaurants on an individual basis. Another poster. went so far as to say that even if they weren't losing money they were less profitable. YOU wrote "still not true" and implied that the restaurant alone, on an increase in volume were offsetting the discounts forced on them by the plan.

So since your post shows your complete lack of reading comprehension in addition to your lack of restaurant industry knowlege (oh, I forgot, you own one )

The post you take care to point out says "Disney was losing PROFIT due to the old DDP, not actually losing money" Oh look at that, it doesn't say anything about an individual restaurant! It says Disney as a whole! Which is exactly what my reply post pertains to...if you are going to use a post to further your point at least read it first

I also think I was quite explicit that I know disney gets massive discounts on their food - due to volume. I just don't believe for a second that DDP made big enough a difference in their food ordering to further lower those prices.

well you can certainly believe that, erroneously. Just ask anyone who used to call in and get a seating at the restaurant of thier choice at any time vs. having to make ADR 180 days in advance these days. The restaurants are doing many times over thier previous volume

As usually happens on these boards (please join a tip discussion sometime) no amount of illustrating your point and providing a basis for your argument can't be met with some good old fashioned knee jerk ranting.

there is someone ranting here and it isn't me would you like a napkin to wipe the foam off your mouth and the spittle from your monitor?

 

[tloft]

I will point out that you were the one who smuggly asserted that the people who don't agree with you just must not know anything about the food service business.

As far as taking the post your were responding out of context (I forgot - I don't know how to read - I am just a dumb hillbilly from SC) I had previously made the point, and the post immediately after the "losing profit" post makes the same argument that the restaurants themselves were losing money. Rather than insulting me again or searching for the right emoticon to sum up your feelings - how about explain to me just how low you think disney's food cost as a percentage of menu price actually is. Just stating how experienced you are and how stupid I am doesn't really constitute a debate.

I don't see anything refuting that with all $39 going to the TS restaurant it would still have been 35% off. A $48 meal probably costs disney about $10 in food. Tax and Gratuity in this scenario is $11.76. Disney has $27.24 to apply to a $10 meal. This puts the food cost at 36% of sale. Not bad in the real world but not very good for Disney standards - but now there is ZERO left over to apply towards those precious snacks and counter service meals you are so sure they rake it in on. The $16 in snack and CS still costs disney another $1.04 in tax. Even at the same 20% cost the CS and snack cost about $3.20. So reduce Disney take by the tax again and they are down to $26.20. Food costs for the day are now totaling $13.20. This yields a 50% food cost for one day on the plan - and if you know any restaurant that can stay open with 50% food costs let me know.

Since this has gotten so convoluted - I just want to sum everything up by saying I made three wonderful trips to disney using the ddp. When the changes were announced I was sad to see the plan go - but effectively the new DDP is a complete elimination of its predecesor. It can still be used profitablly but only with careful consideration - which means it isn't worth it to me. The previous plan was such a no brainer because it did represent a significant value - even to those who used it inefficiently. The depth of that value is why I always perceived the DDP as an incentive like 40% off codes or free dining in September. I just don't think people have any reason to be so upset about Disney essentially ending a promo that has only been around a few years.

That said - this is a completely different argument than the poor souls who arrived in January with no idea the plan had changed. Those people have a legitimate grievance. But on this board everyone registed before January 1 of this year knew this change was coming and I for one think its time to let it go.

 

[hipchickie]

I don't know what your issues are, but I think it is pretty obvious to anyone reading this that for some reason you are a little too emotionally invested in this to have a rational debate. It is only your skewed overheated indignation that has you view a post as "smug" or that I called *you* a hillbilly from SC (again, where did you come up with this??)

To answer your question, I will put disney food service profit in 2007 at a solid 20%, possibly (probably) more due to decreased overhead. Your percentages of food cost are off base, because you are basing food cost at 25% of the inflated on resort property menu prices. While food cost % is higher the Le cellier steakhouse dinner everyone likes to point out, the overall higher profit % built into Disney menu pricing across the board (like my precious snacks) is going increase profit vs. food cost exponentially. Also, I believe it has been pointed out that the guest pays tax at the time of plan purchase, not disney.

Do a little research on economies of scale and returns to scale, take a few deep breaths, and then come back and we will talk about how increased volume increases profits.

 

[tloft]

Do a little research on economies of scale and returns to scale, take a few deep breaths, and then come back and we will talk about how increased volume increases profits.

You are repeatedly ignoring the point that Disney, as one the largest single purchasers of food products in the world (before DDP) is already receiving rock bottom prices. Increased volume does not have an infinite abilitity to reduce cost. You seem to believe that for every increase in volume there is a equal decrease in cost. At what point is disney going to start getting the food for free? Large chains like McDonalds invest in their own manufacturing and distribution because there is a point where supplies simply reach the bottom line. While I am quite sure Disney buyers aggressively negotiate contracts with the individual companies making the food they use, I don't think the bump in business afforded Disney by the DDP makes a company like Lamb-Weston go "oh, now you're doing this much business we'll finally cut you our best deal."

To use a micro example we have a very successful, national wing restaurant franchise that originated in the same town as my restaurant. They now have 33 locations in 7 states. They have three locations in my vicinity that gross from $3.5 to $7 million dollars a year in sales. Their slowest store does 3 times the gross annual business my restaurant does, but they order 10x the volume of wings I do. They literally order more wings a day than we do in a week (and this is at their slowest location). So by your logic they have to be paying not only less per case for wings than I do, but substantially less.
Well, they do pay less, about a $1.00/case less than I do. But that is a savings of less that 2% (please realize that combined for their three locations in my town alone they are doing close to 50 times the purchasing I am). So why aren't they seeing massive discounts? Well - food pricing is seriously competitive to begin with. As I've also argued before, there is also a bottom line that it is worth it to a company to sell a product for - no matter how many you buy. But, what you refuse to acknowledge, is that with the increased volume is substantial increased costs. These three stores receive wing deliveries every day but Sunday. They run a truck on Saturdays just for these three stores. To my knowledge, and I've asked - they are the only store in the greater area (and we are a major tourist destination, a conde nast traveler top american tourist destination, and home to literally hundreds of restaurants) that receives daily deliveries.

Sysco spent millions developing the infrastructure at Disney and sells them their food at rock bottom prices. All of that was in play long before disney ever developed the dining plan.

 

[robinb]

You guys are making my head hurt .

 

[tloft]

It is only your skewed overheated indignation that has you view a post as "smug" or that I called *you* a hillbilly from SC (again, where did you come up with this??)

Gee, I'm sorry I can' imagine where I got the impression you were attacking my intelligence:

“people who say Disney was losing money have really no idea how food service runs.”

“Obviously you have no idea how a kitchen works”

“the fact that you don't think that Disney gets a better deal on foodstuffs with increases in volume shows your general ignorance of the industry”

“your post shows your complete lack of reading comprehension”

“would you like a napkin to wipe the foam off your mouth and the spittle from your monitor?”

 

[tloft]

You guys are making my head hurt .

sorry - I've been using this board for over two years now and as you can see by my post count I usually try to not get this sucked in.