After cutting $10 million in operating expenses during what proved a challenging first quarter, the Pinstripes bocce-and-bowling chain is considering staff reductions and other ways of reducing corporate overhead by another $4 million, executives revealed Thursday.
The officials indicated that labor cuts have already been made at the unit level. They mentioned reductions in both hourly pay and salaries as components of the belt-tightening that was undertaken during the first quarter.
Same-store sales for that period decreased 2.3%, contributing to a $10 million net loss, far wider than the $3 million loss the company reported during the same period last year. Revenues for the 22-location chain rose 18.8%, to $30.6 million, most of it coming from increased food and beverage sales. Dining revenues, which account for 75% of the company’s intake, rose 16%, to $23.8 million.
"Our results for the first quarter did not meet our expectations, as we faced a more challenging macro environment and softer consumer demand than we anticipated," said CEO Dale Schwartz.
The company will try to boost the top line in part by selling event bookings the way hotels have traditionally peddled rooms, Schwartz told financial analysts. Going forward, it will expand its marketing efforts to include travel agents and convention planners, particularly in markets that enjoy high levels of tourism. The chain already markets its event-hosting capabilities to wedding planners and bloggers.
Event bookings account for about 50% of Pinstripes’ revenues, with each of its locations hosting more than 1,000 group parties annually, according to Schwartz.
He also cited such alternative revenue-generators as “paint and sip nights,” where an artist provides instructions on creating a piece of art while guests indulge in small bites and drinks.
Much of Schwartz’s prepared presentation to financial analysts dealt with cutbacks, both the $10 million in cost reductions that were already adopted and the $4 million in efficiencies planned for the quarter that’s underway.
In regard to the latter push for savings, Schwartz acknowledged that “these costs range from negotiations with agency partners to strategic corporate headcount reductions and a renewed focus on marketing efficiency,” but he did not divulge details, including how many employees may be laid off.
He also aired the expectation that new Pinstripes complexes currently under development are expected to generate annual revenues of $7 million each.
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