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How Strict are You?

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robozig

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You’ve just put out a coupon for 50% off a seasonal pizza. You’ve had to temporally stock a few new items in order to make the pizza.

A customer calls in and wants to take advantage of the deal. However the customer wants to make alterations to the pizza to the point that it no longer represents the pizza being offered.

You offer the customer some other deals that might work with the pizza he wants. But he doesn’t understand why he can’t get 50%. After all he’s ordering the pizza he just wants to make some changes.

Do you honor the coupon?

How strict (or flexible) are you with your offers? Do you let customers use coupons past their expiration date? How many substitutions (if any) do you allow?
 
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On special pies we let them remove an item or change an item. for example, we have an offer that gives a price break on any menu combo. If they chose the vegi special and wanted to drop black olives and add extra mushrooms we would allow it.

Expiration dates vary. On our regular offers that we run pretty much constantly, we honor the coupons. They always go find a current one, why make them hassle with it? On a few season offers that are really special for our off season we enforce the expiration date. We also print it more prominantly on the coupon.
 
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Hello Robo,I’m sure most will disagree w/ me butt,I stand strong to what my coupon is and I don’t wiggle w/ it because your already giving them a deal and some really want to take advantage of you.I personally hate doing coupons.I just rather do a strong market campain and have quality food.Some operaters need to stop giving control to their customers,I know that sounds harsh but these people will drag you to the curb.I rather just stand behing my food 100% knowing I truly do have the best food in the area.We sometimes throw an add in the paper that says’ the place that doesn’t give the food away,but you’ll leave here remembering the great food!'And as crazy as it might sound it actually works.I guess I am the Pizza Nazi…lol
Niccademo
 
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I have the tendency to rollover.

I remember in my infancy in this business, I would stand strong on all coupons, and consequently we would loose allot of customers, from my unwillingness to bend.

My Supervisor at the time had gotten a few calls about it, and he sat me down and told me this.

Take every coupon!!! Don’t look at the expiration, Don’t worry about the discount…if the customer is using a Subway coupon to buy Pizza, Great!!!

Simply put you might have 200, maybe 400 customer a week. Only about 1 to 2% of them will pull this routine on you, the rest of our customers are pretty normal.

So you make money off the 98% and you pay the light bill on the remaining 2%.

Your perception is… its not worth it to serve this crazy crack pot pizza at a discount. But what I have found, is that this crack pot is usually your most vocal patron, and he usually promotes you more than the other 98%, and if you stand strong on a coupon and rub him the wrong way, you will probably loose more than just his business.

The funny thing is… its usually the 50% off coupon buyer, who turns around and tips 50%(you know buys a $20 pizza for $10 bucks, and tips $5. bucks) and then you think. GOOFY!!!

A customer for life…

The average customer lives to be 76
Probably orders twice a week in his 20’s(Party on Garth), every other week in his 30’s(spends all money on diapers), twice a week in his 40’s(darn kids), every other week in his 50’s, every third week in his 60’s, and once a month in his 70’s.

So you figure.

20’s 1040 orders
30’s 260 orders
40’s 1040 orders
50’s 260 orders
60’s 170 orders
70’s 72 orders
at an average of $20. per order that’s $56,840 per customer over his lifetime. If he gets you for 50% every time, that still $28,420… I’ll take a 1000 of those customers anytime.

Don’t risk burning a customer over a stupid coupon. You’ll make your profit on the next customer.
 
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Not strict at all. If a Monday/Tuesday special was ordered on another day, no problem. If a one topping pizza for 8.99 was ordered with two toppings, we simply added for the amount of toppings.

The business was a huge success and part of that success resulted from fantastic customer service. It adds up to much more in the end.

PD
 
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tommieknowspizza:
If he gets you for 50% every time, that still $28,420… I’ll take a 1000 of those customers anytime.

Don’t risk burning a customer over a stupid coupon. You’ll make your profit on the next customer.
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If we’re offering 50% off of something, we would pretty much break-even. First off, breaking even on the order is not a loss, and you very well may be keeping a customer for life. Second, like Tommie said, you’ll make your profit on the next guy.

If I could have all of my regular business this week, plus have 100 customers come in and buy something at 50%, would I do it? Absolutely. That generates cash flow, which we all need more than anything. I collect their money today… but I don’t pay the labor on that sale for at least 7 days, and as much as 19 days depending on where we’re at in the pay period. I don’t pay for the food for at least 30 days. All the while, that’s extra cash in my pocket that I can use to fund operations.

I’ve actually thought about finding customers in our database that use the most coupons, and sending them 50% off coupons from time to time just to increase cash flow.

So I guess my answer is that we’re not very strict. I’d honor the coupon from them in an instant. It stops them from going somewhere else, it’s good PR with the customer, and it puts cash in my pocket.
 
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Tommie what a great message…All too often we look at the “little picture” rather than the “big picture”…Thanks…
 
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royster13:
Tommie what a great message…All too often we look at the “little picture” rather than the “big picture”…Thanks…
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It definitely has me rethinking some of our planned policies.
 
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I DO WHAT EVER IT TAKES TO MAKE THE SALE
I WILL TAKE ANY COUPON FROM ANYWHERE
I WILL TAKE MINE OR ANOTHER’S COUPON EVEN IF EXPIRED
IF THEY WANT TO CHANGE A TOPPING,FINE,ADD TOPPINGS,FINE
 
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We honor all of it too…the way I see it is I just want them to call me. Let the franchise employees who could care or less treat em bad.

Kris
 
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I will not honor competitor’s offers unless they really are in the same league with us. I can not sell pizza for dominos prices because I don’t sell dominos pizza.

In other words, I would honor the offers of any shop that makes it’s own dough, uses real cheese and quality ingredients. For the most part, though, I am not in the price wars. We have the best pizza and the best service in town. We are one of the things people say you have to try when you vist here (which is a good thing because about 60% of our sales are to visitors!)

We do have a couple of really good “try me” offers that we run in the off season by mailer. The idea is that a customer could use them once. The discount is steep ($8.50 off a 16") and I only want to honor it once. I also have it expire in the busy season and we stick to that expiration within a week or two.
 
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Again,

I doubt that all your customers will ask you to take a Domino’s Pizza coupon for your product, but for the 1% or 2% that does, your better off taking the coupon, than turning your customer away, to purchase products elsewhere!

I sell a 12" 1 topping for $11.50 and I get it all day long. But occasionally I get the Domino’s 5-5-5 coupon.

You know it only cost me $2.00 to make a 12" pepperoni, $6 food cost divided by $15 revenue equals 40% food cost. I am still making money, and I have kept my customer happy.

Even if 20% of my customers used the 5-5-5 coupon. I would still make money.

i.e.

300 customers a week

20% @ 40% Food Cost = 8%
80% @ 30% Food Cost = 24%
equals 100% of sales at 32%

I am still making money at 32% food cost

how about

50% @ 40% FC = 20%
50% @ 30% FC = 15%
equals 100% @ 35%

I don’t see what all the fuss is about!!!

If my competition flood the market with a low priced coupon, and tries to entice my customers away from me, of course I am going to take the coupon, chances are my competition isn’t will put an expiration date on it, and after 2 months the deep discount program will be over. So 2 months of the year you run a 35% food cost instead of 30% whoopee!!! over the course of a year that will only cost you less that 1% of profit.

How much profit will you loose if you turn them away?
 
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I’d go ahead and honor the coupon, but also let the driver or counterperson to make sure that you get that coupon. I’m usually pretty lax about collecting the coupons, since I try to set them at at around 30 - 35% food cost. If they want to use it again, it’s fine by me.
 
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