Why Chuck E. Cheese Needs to Destroy 7 Billion Paper Prize Tickets
COVID-19 shutdowns and a recent bankruptcy filing have left the chain with surplus tickets as it looks to go digital.
According to the United Nations, the world's population hit 7.7 billion in the middle of last year. And according to Chuck E. Cheese, it has enough leftover paper prize tickets to give one to at least seven billion of us. CEC Entertainment, the 'eatertainment' chain's parent company says that pandemic-related shutdowns (and its June bankruptcy filing) have caused a serious backlog of prize tix, and it has asked a Texas bankruptcy court for permission to destroy all of them.
According to CNN, because the California-based chain has filed for bankruptcy, it has to get the court's approval before it spends money on anything. The restaurant's attorneys say that the cost of destroying the tickets will be $2.3 million, which is around $1 million less than it would cost if the tickets were circulated through the supply chain and distributed to restaurants. If that sounds like a lot of money, well, it's because they're dealing with a lot of tickets: seven billion paper tickets are enough to fill 65 forty-foot cargo shipping containers. (It's also almost enough tickets to cash in for that Wii console you wanted when you were nine. Almost.)
“Since Prize Tickets are redeemable by guests at significantly higher value than the cost of Prize Tickets, the Debtors believe it is in the best interests of the estates to mitigate any risk of these tickets being circulated to the general public,” CEC Entertainment’s attorneys said in a court filing.(If all seven billion of those rat-logo tickets were cashed in at its prize counters, they could be redeemed for about $9 million worth of prizes. That's a lot of generic Nerf footballs.
That's not to say that Chuck E. Cheese is doing away with tickets and prizes altogether: the chain is just shifting to a more touchless experience, complete with e-tickets and contactless ordering. CEO David McKillips, who took over in January, told QSR Magazine that, although the chain wasn't completely prepared for all of the changes that would be necessary in the months following a global pandemic, they'd already been working on their mobile strategy.
One of the first steps that McKillips took was partnering with third-party delivery companies like Grubhub and DoorDash to launch its own virtual brand, Pasqually's Pizza & Wings, which offers "premium pizza" that has been prepared in and picked up from Chuck E. Cheese restaurants. (The mysterious arrival of Pasqually's on Grubhub caused a bit of confusion, when people mistakenly placed their orders thinking that they were supporting small local businesses, but instead got a slice from a chain restaurant whose amenities include Pop-A-Shot games and a recently disinfected Ball Pit.)
After putting Pasqually's on the menu, McKillips turned his attention to e-tickets—and widespread restaurant closures have allowed the chain to remove its old "ticket munchers" that collected paper tickets and swap them for machines that can read the new virtual replacements.
“After you’re at Chuck E. Cheese for an hour and a half to two hours, parents are ready to go. You’re ready to get your check, you’re ready to leave, you’re ready to go home,” he told QSR. "And you have to spend another 15 minutes at the ticket munchers [...] With e-tickets, we're going to be able to expedite the ticking munching and the ordering of tickets lickety split. It's going to be instantaneous. That's going to be a guest experience for our parents to say when they're ready to go, they can head home."
Sorry to break it to you, kids, but you're still not going to have enough tickets for any of the good prizes.