Friday, October 10, 2014

An Update on Cracker Old Country Store Jelly and B

An Update on Cracker Old Country Store Jelly and Butter Waste

The Cracker Barrel Old Country Store restaurant chain this week started placing jellies on the tables for the guest and throwing away unused sealed whipped buttercups from tables. The previous policy had been to give jellies out on request only except for breakfast orders and to reuse the unused buttercups from off customer's tables. Now some may ask, what is the big deal, just a little jelly and butter right, no not just a little jelly and butter when you consider all of the Cracker Barrels in the United States. If and I must stress if, since i am not sure of this policy is in place in all Cracker Barrels, if all the Cracker Barrels in the United States practices this policy I figure it could cost the company over one million dollars a day.

I used very conservative numbers to arrive at this liability. Here is the math, with the lowest priced jelly costing $.09 and calculating in $.02 for butter loss, if this new policy encourages at least 50 tables a day to use a jelly they would not normally use due to the jelly being right in front of them on the table the that could potentially cost $.11. Multiply the $.11 times 50 which amounts $5.50 per day, $1,996.5 per year. This in my opinion is a very conservative figure. Now if you multiply that times 626 stores you get $1,249,809. For the amount of days I used 363 since Cracker Barrel closes at 2:00 P.M. Christmas Eve and is closed all of Christmas Day.

Should investors be concerned, not so much that it is going to throw the stock in a downward spiral but that this could be wasting company assets and that $1,249,809 in potential loss should not be taken lightly. Money that could be spent on advertising, increased dividends or paying employees more to attract better talent in the individual stores. This is my opinion but I think I raise some valid questions that corporate needs to address.

Update on Jellies and Butters

Cracker Barrel has pulled the jellies off the table and are back to recycling sealed whipped buttercups. I wonder if this is due to the loss of money I spoke of earlier or something else? I wonder if any one list their job or was reprimand for this idea? I would love to know.

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Thursday, October 9, 2014

Attention Cracker Barrel Investors

Attention Cracker Barrel Investors

Cracker Barrel investors may want to research how at least one Cracker Barrel is managing their resources. Jelly and butter may seem like inconsequential commodities but if you add up the price of sealed whipped buttercups and individual jelly packs used over a year's time it could be quite a sum. Now this is calculating in that all Cracker Barrels will embrace this new jelly and butter policy which seems logical since Cracker Barrel strives for consistency in all their stores. So what is happening with jelly and butter? At least one Cracker Barrel, I will not say which one, is placing jelly on the tables and throwing away unused buttercups from tables. In the past, jellies were given out per request except for breakfast meals and unused buttercups were taken back and used for other guests.

So What is the Big Deal?

Why worry about this new practice? Well the big concern is if this is going to be a company wide policy, with all Cracker Barrels throughout the chain throwing away buttercups and making jellies easily accessible for the convenience of the guest. If this is a company wide policy it could add up to a pretty good chunk of change over a year's time. Now the buttercup policy may be about health codes so we will lay that aside but just the cost of jellies alone could possibly cost the company a lot.

Let's Do Some Math

If one jelly pack cost .06 and because of jellies were on the table it caused an additional 50 jelly packets per day to be used it would be an annual cost of $1092 per store. No big deal right, let's say this is a company wide policy and you take 600 stores using the same amount of additional jellies, 50 extra per day, then it would be $1800 per day and $655,200 per year.

I do not know of this is a company wide policy but if it is then I believe it warrants the scrutiny of all who on own a part of Cracker Barrel Old Country Store. Maybe there is a good reason for this jelly and butter policy or maybe it is an example of poor management of Cracker Barrel assets. Just my opinion.

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