Seems fine? You were already set to pay a specific total, I don’t see a problem putting the discount on to pocket the savings. Company still made a profit even after the discount, employee got a decent tip, and customer has not been cheated or exploited.
Profit margins for restaurants are typically in the single digits, so the company almost definitely lost money after the discount. A $25 tip for a $50 meal at Denny’s is a lot more than “decent”
I guarantee their employee meals aren’t sold at a loss, chain diners have the cheapest input cost of any restaurant because it’s all eggs, breakfast meat and bread
That's what they're pointing out. The cost per customer includes much more than the food itself, so factoring that in, they lost money on this order. The employee discount is part of the employee's compensation, not something to be given away to random customers.
Those are not the only expenses. They'll have labor, rent, utilities, debt. I'm guessing labor is highest. After all that, their profit margins are <10%, so the employee discount meals are definitely sold at a loss.
Running a kitchen, doing nu.bsers for the restaurant. Yeah they ate it on this ticket. Labor is expensive af.
Restaurants exist to pay cooks, tip servers and bankrupt owners. If you're really careful the owners can make as much as the cooks. Probably not as much as the servers.
That's even worse, they're big enough you can look up the profit margin yourself. At (drumroll) 2.2%, extra napkins are probably eating into their margin.
It really bothers me how economically illiterate any conversation about economics is, both online and in person, and how easily people fall for populist slop. I'm not expecting people to all be economists, I'm not, but expecting people to check a company's profit margin before arguing it could easily eat a 25% discount is not a big ask.
Single digit margin doesn't mean less than $10. It means less than 10%. Their annual revenue was $450 million. That $21 million is 4.7% of that, or single digits margin.
Are you 10 years old…? A nation wide franchise making $21m is abysmal. Say they still have 500 restaurants, that’s about $40,000 profit per restaurant for the entire year. 😂
They have around 2-3% margins so employees stealing 25% of a bill is a loss to their bottom line. I’m not saying this single transaction is bankrupting them, as you seem to be implying but I’m not sure why you would think I’m saying that
No, the issue is that this is theft, and everyone acting like it isn't is being weird about it. Shoplifting from Walmart is also theft, even though they make a lot of money.
If all the employees did this on every order, the company would bankrupt very quickly, and if too many people shoplift from the same store. It's not complicated, at all.
Thieves aren't some robin hood vigilante freedom fighters getting one over on the system, they're criminals ultimately hurting the employees and customers of the company.
So you think every item on the Denny’s menu is at least a 25% profit margin for the company? It’s like 2.2% overall. They just let employees discount one meal per shift as a little bonus and incentive to work there, taking a small loss when they decide to use it
You’re confusing food yield with profit margins. I run PnLs for restaurant corporations, you think every time a company runs a 25% sale they operate on a EBITDA loss? A BoGo would bankrupt them lmao
A 25% likely doesn’t even show on their high discount reporting
Some amount of shoplifting is “factored in” to retail businesses, but that doesn’t mean they want employees stealing from them. It’s not like it’s just free money with no consequence to anything
They run discounts at all times, discounts are a mask for the mathematically uninclined to present a deal after hiking a price in the backend or at minimum to reduce a ticket average to an amount less then a comp % would earn.
A restaurant does not operate in loss leaders, it’s not a grocery. Managers can free out meals for opportunities, that’s granted. A regular team member would never be given a discount that is approved to be unprofitable because no sale is intended to be unprofitable.
The one and only thing that matter out of meal cost for a restaurant is the food cost yield itself, and the profit is determined after factoring in the labor for FLM and the backend costs -royalties if franchise for the ebida results
They run discounts that their marketing team figures out should be profitable in the end. That doesn’t authorize employees to steal directly from them using unauthorized discounts and pocketing the difference
I never argued about the morality of him using his one alotted emp meal or their policy, simply that you think a 25% discount makes a meal unprofitable and your evidence is their net profit margin is laughable, provably wrong by the industry itself and is practically apples to oranges. Meanwhile your defending it from multiple people like it’s your 9-5
I’m not arguing that their net profit is 2.2, papa johns has reported no profit that doesn’t mean they don’t make money. He seems to think a meal discount is 1:1 profit %
No they're not. Assuming from your comment that you did work at Dennys, unless you were management you likely never saw or dealt them the P&L statements. If profits were above 5% I'd be shocked and assuming someone fucked up the books.
That's not the right number to determine if they lost money on a single additional bill because most of their expenses are not affected by there being one more order when their already open.
Getting 1 additional order during a shift does not change their rent, wages, taxes, utilities (except water/energy used for that specific meal). It just uses some of their inventory.
And if they only get one discount per shift anyway, the cost of those discounts is factored in to the 2.2% anyway, even if this is larger than average
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u/strolpol 2d ago
Seems fine? You were already set to pay a specific total, I don’t see a problem putting the discount on to pocket the savings. Company still made a profit even after the discount, employee got a decent tip, and customer has not been cheated or exploited.