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White Hutchinson Leisure & Learning Group, Kansas City, MO, USA

The folly of not meeting the rising expectation for food sophistication and healthfulness

We've been tracking and analyzing the long-term trend of declining same stores sales of Chuck E. Cheese's for several years. For a detailed analysis, see our June 2013 article (www.whitehutchinson.com/ news/ lenews/ 2013/ june/ article104.shtml) . As that article showed, the decade-long one-quarter (24%) decline in CEC's same store sales is due to an almost one-half (46%) decline of their same store food and beverage sales.

Every six months Nation's Restaurant News magazine and WD Partners run their Consumer Picks survey on the popularity of different national brand restaurant chains. The recent survey results were just published based on 126,000 restaurant visits by 5,4761 survey respondents to 152 different national restaurant chains in four different industry segments during the six months July 15, 2013 to January 14, 2014. The restaurant chains included Chuck E. Cheese's, whichfalls in the limited-service (order at counter) category.

Of all the 10 rated attributes, the survey found limited-service category consumers considered Food Quality as most important, followed by Cleanliness. Value was in third place followed by Service. What the survey calls the X Factor, fifth in importance and what can make the most difference in setting a limited-service chain apart and in a chain's overall rating, is Craveability.

In terms of overall scores among all limited-service chains, Chuck E. Cheese's came in dead last with its overall score of 33.4%.

Here's how CEC fared this time in all 10 attributes among the 105 limited-service chains:

It's basically been a downhill rating slide for CEC in just about every category.

CEC was recently acquired by Apollo Global Management LLC who took the company private for $1.3 billion including the assumption of debt. They sure have their work cut out for them if they hope to turn Chuck E. Cheese's food reputation around for todays much more sophisticated and demanding restaurant consumer, and in this case, that includes moms concerned about the healthiness of their children's food.

CEC's poor food reputation and performance is a lesson for all types of children's entertainment and family entertainment centers - the quality of food really matters!

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