Priority Pass Restaurant Added: JFK -- Bobby Van's Steakhouse
#31
Moderator
Join Date: Jun 2003
Location: Miami, Mpls & London
Programs: AA & Marriott Perpetual Platinum; DL & HH Gold
Posts: 48,952
That's not how Priority Pass works. The lounge specifies the maximum number of guests. The credit card which sponsors your memberships tells you how many guests they will pay for (2), but that does not increase the number of guests that the lounge will admit.
You can see here that Bobby Van's permits only one guest:
https://www.prioritypass.com/en/loun...ans-steakhouse
You can see here that Bobby Van's permits only one guest:
https://www.prioritypass.com/en/loun...ans-steakhouse
#32
Join Date: Apr 2000
Location: Fort Myers, FL
Programs: Hilton Gold, SPG & IHG Plat, & every airline program that I can join
Posts: 2,279
Am I assuming that if I am flying into terminal 5 and there is no connection airside that I would not be able to access terminal 8 security since I do not have a flight leaving there that day?
#34
Join Date: Jul 2010
Location: LGA/JFK
Programs: DL PM, UA Premier, AA Gold, Hertz PC, National Exec Elite, Sixt Plat
Posts: 500
Data point. JFK T8 changed their policy on Nov. 1 to only allow ticketed passengers using T8 to go through security to T8.
#37
Join Date: Dec 2015
Location: SNA
Programs: MARRIOTT TITANIUM / HILTON GOLD / UA SILVER / AMEX PLAT
Posts: 609
I have a hypothesis that Priority Pass is beneficial for restaurants in the short term by providing immediate cash but over time the benefits decrease. This is based on several factors:
I. The profit margins of PP is not sustainable. Most restaurants have a profit margin of around 8.0%, but lets say that airports restaurants can bring this up to 15.0% -20% [1]. On Priority Pass, restaurants that offer a credit of $28 see PP take $5 resulting in a net revenue of 82.15% [2]. But remember that the typical profit margin is 15% - 20% and PP is taking 17.85% of that. Even with best estimates PP only generates 2%-3% profit margin vs. the 8% for regular guests.
II. Priority Pass displacement. As many are aware, Priority Pass is very popular. Initially, the ratio of PP guest to regular guests is 12.5% [3] but as word gets out the influx of PP grows towards 38%-50% [3] [4]. As this displacement increases and if point I. is correct we will see a dramatic decrease in profits and perhaps even a loss.
III. Crowding and its effect on service quality. Priority Pass increases patronage for that restaurant in most cases [3]. However, this puts an increased strain on the wait and kitchen staff. Now, at a regular restaurant the obvious solution is to hire more staff and become more efficient (i.e. better equipment) but with the decrease in profit margin based on points I. and II. that becomes much more difficult. Perhaps some PP restaurants can do so but the majority will not be able too. This means longer wait times and more occurrences of badly prepared (bad tasting / ugly, not unsanitary) food going out. Now, if you read the Yelp reviews of PP restaurants you will see that persons with PP are much more likely to put up with longer wait times and worse quality food vs. regular customers. This results is lower review scores that cause even less regular customers to dine at the PP affiliated restaurant.
IV. Cost Cutting Based on the aforementioned positions, I think a good case can be made for a dramatic decrease in profits or perhaps even a loss, crowding, and an increase in PP holders. When faced with such losses some restaurant owners may choose to cut food quality in an attempt to raise revenue. After all, if the main paradigm is that the fact that it is free matters more than quality then why would a restaurant owner not do so.
Thus we end up with restaurants that are crowded, with less that stellar service, and a greater chance that low quality food will be sent out.
[1]
https://www.forbes.com/sites/sagewor.../#5fe100a27f9f
[2]
https://viewfromthewing.com/how-much...ts-profitable/
[3]
https://businessden.com/2018/06/08/b...-with-a-catch/
[4]
https://www.flyinghighonpoints.com/r...den-denver-co/
I. The profit margins of PP is not sustainable. Most restaurants have a profit margin of around 8.0%, but lets say that airports restaurants can bring this up to 15.0% -20% [1]. On Priority Pass, restaurants that offer a credit of $28 see PP take $5 resulting in a net revenue of 82.15% [2]. But remember that the typical profit margin is 15% - 20% and PP is taking 17.85% of that. Even with best estimates PP only generates 2%-3% profit margin vs. the 8% for regular guests.
II. Priority Pass displacement. As many are aware, Priority Pass is very popular. Initially, the ratio of PP guest to regular guests is 12.5% [3] but as word gets out the influx of PP grows towards 38%-50% [3] [4]. As this displacement increases and if point I. is correct we will see a dramatic decrease in profits and perhaps even a loss.
III. Crowding and its effect on service quality. Priority Pass increases patronage for that restaurant in most cases [3]. However, this puts an increased strain on the wait and kitchen staff. Now, at a regular restaurant the obvious solution is to hire more staff and become more efficient (i.e. better equipment) but with the decrease in profit margin based on points I. and II. that becomes much more difficult. Perhaps some PP restaurants can do so but the majority will not be able too. This means longer wait times and more occurrences of badly prepared (bad tasting / ugly, not unsanitary) food going out. Now, if you read the Yelp reviews of PP restaurants you will see that persons with PP are much more likely to put up with longer wait times and worse quality food vs. regular customers. This results is lower review scores that cause even less regular customers to dine at the PP affiliated restaurant.
IV. Cost Cutting Based on the aforementioned positions, I think a good case can be made for a dramatic decrease in profits or perhaps even a loss, crowding, and an increase in PP holders. When faced with such losses some restaurant owners may choose to cut food quality in an attempt to raise revenue. After all, if the main paradigm is that the fact that it is free matters more than quality then why would a restaurant owner not do so.
Thus we end up with restaurants that are crowded, with less that stellar service, and a greater chance that low quality food will be sent out.
[1]
https://www.forbes.com/sites/sagewor.../#5fe100a27f9f
[2]
https://viewfromthewing.com/how-much...ts-profitable/
[3]
https://businessden.com/2018/06/08/b...-with-a-catch/
[4]
https://www.flyinghighonpoints.com/r...den-denver-co/
Last edited by OUTraveling; Nov 6, 2019 at 12:30 pm Reason: Grammer and Spelling
#38
Join Date: Jun 2013
Location: NYC
Programs: Marriott Plat, Hilton Gold, UA Silver
Posts: 2,272
No idea what the quality of service was before. I know on a recent visit I was not impressed with the service and the food was meh. I would have never paid the prices they charged for food there if I didn't have PP.
#39
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and why we likely see so much turnover in restaurants accepting and not accepting PP. I mean at LAX, 3 of the 4 restaurants that have joined PP have already left the program.
#41
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Join Date: May 2002
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