School Fundraiser/Equipment

Well you all have changed my mind so many times over the years, I just want to get your opinions on the current situation…

About 1 1/2 ago the sports boosters wanted us to do the pizzas for the football game, the catch was we had to buy the warmer for the pizzas and keep it in the brand new concession they built.

We purchased a used holding cabinet for about 500 bucks. They have used it 2 seasons.

The last home game is tomorrow.

We sell a one topping 16" to them for 6.00 they sell it for a total of 12.oo. We have always considered it an investment to be involved in the community.

They usually order about 25 pizzas each game.(charge, and pay at end of season)

Today the gal calls and says the warmer is broke and needs it fixed by tomorrow. I told her that just isn’t possible. She said she will have to call someone else for pizzas then. About a 1/2 hour later she called and ordered the pizzas. She was completely rude (and usually is)

She said there may be one more game on Monday and it MUST be fixed by then. I told her I would see what I can do…

My issue is the previous game was last Thursday…so why didn’t they call then…come to find out last night there was an event at the school, they had concession and probably used it then…but not for our pizzas.

I am just wondering if this is all worth it…We barely make anything of the pizzas, the gal is totally rude every time they deal with us, we have to supply the warming equipment? We are not allowed to “post” advertisements at the games, but they do say it is from our place.

Just want your guys opinion…Is it worth it?

BTW the holding cabinet is a big warmer Holds all 25 pizzas at once.

Are we really getting a return on this investment?

Kris

I would not do it under those terms, even without the rudeness.

Not that I have any experience with such a situation, I wouldn’t continue doing it. Doesn’t sound like its worth the headache and it sounds like they/she is very unappreciative of your efforts.

Kris
I have sung this song before so change the station if you do not want to hear it. When I was taking Business Administration in college one of the courses was cost accounting. The one most important thing a learned in that course was: If the endevor does not have any adverse effect on your normal business and you make at least $1 then go aheaad and do it. The idea behind this statement is that your normal business looks after your fixed costs like the rent and insurance etc. By taking on this business you only need look at the incremental costs such as food costs and labor and the extra utilities. If you are making any money after those costs AND not taking away from your regular business, why not?

The question of the warmer is another matter. Was there a clear agreement that you retained ownership of it? If so you could do any number of things to prevent the use of it if your pizzas are not being held in it.

It is a nice piece of equipment to have in any case and it is yours. Fix it.

Put a hasp and a lock on it so it can not be used when your product is not there.

Raise your price a dollar or two a pie to reflect the change in costs over the last year. They can raise the price they charge too.

I think it would be fair to look for a responsible person to talk about the relationship. That does NOT have to be the person that calls in the orders. They should understand that selling pies for $6 is not a money maker for you and you are the one doing the favor for them, not the other way around. Fair treatment and the ability to put up a sign are not too much to ask.

If those things don’t work out, move on and take the unit with you.

Activities that add complexity to your operation or cause aggrevation are not worth doing for a dollar. Making and delivering pizza for $6 is not a profitable enterprise, if it also causes brain damage, walk away.

My theory on dealing with schools is probably different than most.

  1. I do not discount my product. My business taxes and home taxes support the schools more than 90% of the population.

  2. I never turn down any school when they want an ad in the newspaper, yearbook, etc…

  3. I have school nights and give 15% back to the school when they bring in a flyer.

  4. I get a ton of school business at regular price by supporting their functions.

I was asked by the booster club this year to supply pizza for the football games for $6. I declined and told them we both will end up not liking each other. First, at $6 I am making very little money and second, I can not delay my regular customers orders for $6 pizzas. I still get all the football orders when they go out of town (they feed the team before the game when they travel) and they recommend me to the visiting teams.

I guess I’ve been doing this too long, but I get really tired of those who think they’re doing you a favor by purchasing your pizza at less than half price, in large quantities during the dinner hour. Insisting on you providing and then damaging a pizza warmer would only be icing on the cake.

I understand Daddio’s advice, but think I agree more with bodegahwy.

I learned a long time ago to set my price at a level at which I could still smile when they came to pick them up. With a $500 warmer, there’s no way I’d sell a 16" pizza (my quality) for that price, even if I was attempting to build a loyal relationship with the customer.

Doesn’t sound like much loyalty to me. Of course these type transactions (lowest bid) are not about quality anyway.

There’s a saying: Send disloyal (cheap) customers to your competitors and let them go broke!

Considering your current situation…would you prefer to be in it or would you rather it be your competitor?

That being said, I did a really nice thing this year for the local peewee football program (providing resale pizzas for $7) and ended up with the huge (3 night) end of year parties. It will add about $2300 in sales this week, which does really help out.

Every situation is different but I’d have to sell a lot of pizzas at $6 to come close to purchasing a $500 warmer, and I’d be extremely resentful that it was not taken care of. But if they didn’t pay for it, either up front or in the price of the pizza, it’s not surprising.

Another thing I insist on in these type transactions is to have one point of contact.

Did you guys miss the IF IT DOES NOT HAVE AN ADVERSE EFFECT part of the advice? 25 pies on a Friday supper rush for a discount price would certainly have an adverse effect on my opperation.

Establish your intent and goal for the project: profit, relationship building, marketing, marketplace visibility, new customer recruitment, goodwill, feeling warm and fuzzy, tax benefits, combination of two or more.

Once you have a clear idea what you are wanting to accomplish, then decision making becomes easier. If this is about making money, then you need to price according to your needs given the whole picture. Same with the other goals; what’s the goal, and how do you achieve it in this venture. Look at the overall impact of the venture/project on your business. Be objective about direct and indirect impacts, both positive and negative, on your business. If you pulled three new regular customers from the whole thing, then you have MORE THAN paid for the warming cabinet within 6 months of patronage.

Are the benefits you identify worth the liabilities. Cost/benefit analysis based on goals and objectives. How does it fit into your business plan?

Daddio is correct. This is a given business concept. The tough part is figuring out if it adversely affects your business. Does it cannibalize existing sales? Does it reduce the perception of your brand (low price when you are a high quality type)? But don’t turn away a sale simply because it is not enough profit.

I would look to speak to whoever is in charge and attempt to discuss the situation and expectations. We have provided pizzas for a local high school band for 6 years for band activities and for the concesion stands at football and basketball games. This year the woman in charge wanted me to beat the low bidder a new comer in our market for the right to sell pizzas to them. I explained that over the last six years I have donated about $4500 to various activities at that school and I sell them my pizza at close to half of menu price for their activities and I have not changed that price even though for 6 years my costs have increased. She chose a competitor in order to save 50 cents per pie. A few band parents asked my why I wasn’t providing pizza and I explained the situation. They sent the head of the band boosters to talk to me since I am a regular sponsor of their events and was rather ticked off. When they had their big marching band competion they ordered from me, put up my banners and through the day bought about 60 large peperoni pies. They profited over 600 dollars in the deal. They never moved the other guys pizza like that and now the concesion stand deals with me. For some reason the lady that is in charge of feeding the band at events still has not got the clue though and insists on buying from the other guy.

They also should be selling the slices for more. Our school gets $2.00 per slice out of a 14" cut into 8.

Schools groups are hard to deal with because there is no continuity of the people in charge and most of the time those in charge are not familiar with business. A few years ago the high school closest to us decided that they were charging way too little for ads in their football program. They jacked up the price to where a business card size ad cost the same as a half page at other area schools. When I was asked about an ad, I said I would probably want the same as last year (half page) and then when the price list came out I said I would need to think about it and speak to my wife. They told me that if I expected to sell pizza to any athletic groups up there I would buy at least a half page. I told the lady I would be buying an ad of my choosing in order to support the kids and if the pizza sales were dependent on my buying an ad I did not want the business. Come to find out, this woman had been strong arming a lot of area businesses thinking she was being an aggresive sales person. We were visited by a couple of people from the athletic boosters with an apology and things went back to normal.

Rick

We had a similar experience a number of years ago. After buying a $500 ad the size of two business cards which is just a donation in my book, they came asking us to beat the other guy on price for an order of 20 16" pies where we were already at 40% off (another donation as far as I am concerned) I said no.

After that experience we said that we would be happy to give them the pizza for free rather than compete on price and pass on the ad. Better for us all around. In the end we got an even better deal. Now we give them about 40 free pies per year in trade for the ad.

Well thanks for the input.

I know when we first got the opportunity, we were thrilled, just to have the business. It wasn’t costing us anything because we were open and running and pouring out 25 pizzas wasn’t really that big of a deal because it is before the rush BUT over the past 2 seasons it just really isn’t worth dealing with this woman.

We also donate 30 pies to the football team for a lock in they have before the season starts…but all in all realizing none of these people are regulars and quite frankly no one appreciates it. The first year we got a card, the second nothing…not even a thanks.

We are getting more choosy in our donation area. Our hope was it would bring a relationship between us and the teams, it has not, so it is probably time to move on. They do go for cheap and we can’t/won’t compete there anymore.

As far as the equipment, the cabinet was used but refurbished and barely used. Considering they have had no more than 20 games it just doesn’t make sense that it is broke, seems someone left it on or they use it for everything else too.

We do retain the ownership and I think we will just pick it up and see what kind of true condition it is in. Since it is the end of the season we can think about it a bit and go from there.

Thanks for input.

You guys are great.

Kris

Organizations that can not even send a thankyou note for donations are politely declined the next time they ask.

We post the thank you letters and notes for donations all around the customer area of the store. They cover most of the available space on the customer side of our counter and some of the walls.

Our local high school approached us about pizza for the concessions, they wanted to replace Domino’s. They were of course doing the 6.00 pizza, so I brought in the athletic director and had lunch, We discussed and worked out how it could be benificial for both of us. I showed him my cost and at 6.00 we are just donating the pizzas. So we worked it out that the guy who announces the game would anounce us once the first half, then at half time they choose a student to attempt a feild goal, that student wins a large pizza!!! (they have NEVER come alone…ever) then we get 3 anouncements in the second half the last being at the end of the game…AND we get a map printed on the back of the program so visiting teams can find us as well…IT really is tough cranking out those pizzas at 7 on a friday but I put 2 teenagers on one making and one catching. thats all they do, we stay out of there way and vice versa. Let me just say the rush after the game REALLY REALLY goes a long way…we used to be cleaning and cutting down right about 9, not any more on home games…we see an extra 3-400 bump…
Lastly to tie this in Last week we were approached by the basketball coach and asked if we could do pizza, I am hoping to do the same deal, but I do need to get a display for the concession stand…so you bet I will look for one…good luck Kris