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What’s happening with Chuck E. Cheese’s?

As we reported in our previous blog, Chuck E. Cheese’s (CEC Entertainment) saw a 3.9% increase in comparable store sales during the last quarter of 2010. Probably all of this increase was due to the increases in the birthday party revenue: +17% during the 4th quarter. This came on the heels of a 16% increase in birthday party revenue during the 3rd quarter. The company credits the birthday party increases to the rollout of their new ticket blasters that were introduced in June 2010 and a 100-token bonus promotion to shift more parties to Friday and Sundays.

The company reported the following operating costs for the 4th quarter:

  • COGS for food & beverage – 23.6%
  • COGS for entertainment and merchandise – 8.1%
  • Labor 29.9%
  • Advertising 4.4%
  • General and administrative – 7.3%

During the 1st half of 2011, CEC is rolling out a new enhanced pizza with a crispy crust. The dough will be made fresh in the stores and the pizzas will feature real mozzarella cheese that will come to the stores in large blocks and be grated fresh. The company did extensive market and focus group research in developing the new pizza.

CEC plans to spend $63 million during 2011 in North America to expand 30 to 35 stores, remodel 15 to 20 stores, add game enhancements to stores and to continue to open new stores that will average 15,000 square feet in size. They are also aggressively pursuing their international franchise program.

About Randy White

Randy White is CEO and co-founder of the White Hutchinson Leisure & Learning Group. The 31-year-old company, with offices in Kansas City, Missouri, has worked for over 600 clients in 37 countries throughout the world. Projects the company has designed and produced have won seventeen 1st place awards. Randy is considered to be one of the world's foremost authorities on feasibility, brand development, design and production of leisure experience destinations including entertainment, eatertainment, edutainment, agritainment/agritourism, play and leisure facilities.

Randy was featured on the Food Network's Unwrapped television show as an eatertainment expert, quoted as an entertainment/edutainment center expert in the Wall Street Journal, USA Today, New York Times and Time magazine and received recognition for family-friendly designs by Pizza Today magazine. One of the company's projects was featured as an example of an edutainment project in the book The Experience Economy. Numerous national newspapers have interviewed him as an expert on shopping center and mall entertainment and retail-tainment.

Randy is a graduate of New York University. Prior to repositioning the company in 1989 to work exclusively in the leisure and learning industry, White Hutchinson was active in the retail/commercial real estate industry as a real estate consultancy specializing in workouts/turnarounds of commercial projects. In the late 1960s to early 1980s, Randy managed a diversified real estate development company that developed, owned and managed over 2.0 million square feet of shopping centers and mixed-use projects and 2,000 acres of residential subdivisions. Randy has held the designations of CSM (Certified Shopping Center Manager) and Certified Retail Property Executive (CRX) from the International Council of Shopping Centers (ICSC).

He has authored over 150 articles that have been published in over 40 leading entertainment/leisure and early childhood education industry magazines and journals and has been a featured speaker and keynoter at over 40 different conventions and trade groups.

Randy is the editor of his company's Leisure eNewsletter, has a blog and posts on Twitter and Linkedin.

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