Why is it that when I am famished on a Saturday night at one AM and I drive to my favorite late night chile hole in the wall I can't find a seat? Not only can I not find a seat, I can't even see the table. In the dead of night, this currrency clad rectangle, is a mob-scene. I feel that much like baseball's recent move to switch to variable pricing, Hubbas should too. During the day, when only the occasional Port Chesterian meanders in for food, the price for a bowl of chili should be fairly low. But when hordes of highschoolers flock to the cramped 12 seat box, the price should increase to the point at which no one is left standing waiting to pay money for food. This way the local customers are kept happy with the low day prices and maximum profit is squeezed from the wealthy high schooler of Rye and Harrison. Although I myself wouldn't want this price system I am proposing to be put into action, if I were Hubbas, I would do it
-Louis DeSantis
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11 comments:
I think this is a good idea not only beacuase it is more crowded at night but the people that go there during the day, the laborers and unemployed, tend to have less money than the Rye and Harrison kids that go at night.
Louis, this is an interesting approach to a classic supply and demand problem. However, is part of the "mystique" of Hubba's the fact that it is always so crowded? What would happen if it were empty--might people think that the chili cheese fries weren't that special?
Alex interesting point you have there but the reason Hubba's is so popular is that people like their prices. Now I know your thinking these kids just take their parents money, but that still could affect Hubba's buisness because parents might not want to give their children $20 every time they want a chili cheese dog. Furthermore, Hubba's could not increase their prices too much because people would just go out and buy their own hotdogs, buns, condaments, cheese as wells as chili. Also, the restaurant buisness is extremely competitive and I think Hubba's prices and ambiance are what has kept them around.
I understand your point Josh so I was wondering what if Hubbas kept the current prices for the highschoolers and lowered the prices during the day? So nothing really changes for the Rye and Harrison kids, but there is more incentive for the people of Port Chester to come during the day. That ways it attracts more people and there really isn't that much risk in losing customers or losing to the competition.
to riddhima
i think this is a good point but also an ironic one as in this case a student card would get you an increase in price not a discount
I disagree with both Louis’ argument and Alex’s response. First of all Hubbas originally became so popular because it was a cheap place for kids and adults all around the area to come and eat. My brother who used to go the restaurant when he was in high school, now refuses to go because he feels betrayed by the fact that the place has raised the prices so much in the last 5 years. He tells me that he used to be able to get a California wedge for 3 bucks, while now they are charging 5 or 5.50. A proposed plan to implement variable pricing so the “unemployed” and “laborers” can eat there cheap during the day and the high school kids can go during the night is absurd. I don’t know if you guys have realized, but the place is not only open on Friday and Saturdays. The place is packed full of these so called “unemployed” and “laborers” on every night of the week, and there are very few customers there during the day. Also even though high school kids dominate the place from about 11pm to 1am on weekends, from 1am onwards the place is filled with “lower income” people. These people with lower income are attracted to Hubbas not just because of its delicious chili, but also because of its low prices. To raise the prices at night would lose a large portion of the restaurant’s loyal customers.
Another interesting thing I have noticed about Hubba’s, is how kids these days go to the place simply because it is popular. For example, the place got its name for its chili, but I know people who will go there and order a plain burger or a plain hotdog. What is the point of this? You can go to McDonald’s, Wendy’s, or Burger King down the street and get a much better burger for the same price. For some reason, however, there is some mysterious attraction about the place that brings in high school kids across the county.
"A proposed plan to implement variable pricing so the “unemployed” and “laborers” can eat there cheap during the day and the high school kids can go during the night is absurd."
I hardly find it absurd if Hubbas is able to make more money. And on top of that I am not saying Hubbas should charge one price to laborers and one price to high school kids. I am saying that the timing and price should be considered together kind of like train tickets...there's one price for peak hours and one price for off-peak. And I said that the proposal should not include increasing the prices at night and that the prices should remain as it is and only be lowered during the day to bring more customers. The way I see it, it's a win-win situation.
From all of these comments, I am confused on when people go to Hubba's. I think that the variable pricing think will work only depending on the time when people go there. For example, if these laborers and unemployed people are there at night along with the students like Sharaff suggets, but it is nearly empty during the day time, then the best thing to do in my opinion would be to lower the price during the day to attract more customers at that time. This could also help reduce the numbers of people in the place at night and shorten the lines. And they could keep the prices the same at night so that their loyal customers continue going there. Basically, there would be variable pricing, but not to the extent the Louis suggested. Also, if they are making such a large profit, I'm sure they could invest in a larger building with more tables so that they could fit more people in. If it packed at night and there is more space, the benefits will outweigh the cost of expanding, and they will be able to maxmize their profit by serving more customers.
Hubba's has every right to alter their prices as they please. Price is just not determined on the cost of supply but also on demand. It is only fair for the price of a good to increase if the demand increases. The only exeption to this rule, however, is when the service being provided is one of life's necessities.
Supply and demand is a fundamental rule of economics. Although I support free market laissez- faire philosophies, the only problem in these free markets is that poor consumers can not afford higher priced goods. However, is this a problem? No, if something is more expensive then only those who can afford should be able to buy it. Although I endorsed these ideas, I disagree with them when they obstruct people's natural rights. If someone is unable to get a heart transplant because it is too expensive, or if someone can not afford to have light after a storm, this is the fault of the free market economy. However, when talking about Hubba's restaurant the suppliers have every right to change prices according to demand. It they are priced unfairly it will just result in a negative consumer response. I believe that free trade is the purest way to buy and sell goods. Suppliers have every right to set prices while consumers have every right to respond accordingly.
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