RC Group Current Financial Condition

[mariner6]

23 minutes ago, jalves said:

No, I don't think so.  If they did the line would quickly get a reputation for poor quality and bookings will suffer.  They won't shoot themselves in the foot.

Bingo!..

That's what I also think and hope!  You will pay for it, but quality needs to remain the same or better so we can keep on doing future bookings.

Edited October 14, 2020 by mariner6

[Baron Barracuda]

1 hour ago, mariner6 said:

Bingo!..

That's what I also think and hope!  You will pay for it, but quality needs to remain the same or better so we can keep on doing future bookings.

 

IMO cutbacks, especially in food quality, really became evident a few years ago when Fain set out his double-double goal (double earnings in 3 years + double digit return on invested capital).  They hit that target and execs got big bonuses.  Meanwhile fares and beverage prices soared and service suffered.

 

By the way food & beverages last year only amounted to 5.3% of revenue.  Meanwhile Marketing was 14%, payroll 10% and fuel 6.4%.  The largest expense category was Commissions, transportation & other 15%.  If I were a TA I'd be nervous.

[time4u2go]

2 hours ago, ATC cruiser said:

Not even close to that. Not all ships have 6000 passengers and all ships will be sailing at reduced capacity. On top of that not all people are wasting that much food each day. 

Also those that are tallying up the savings are not considering that there will be an additional labor cost for the people that serve the food.

[klfrodo]

13 minutes ago, time4u2go said:

Also those that are tallying up the savings are not considering that there will be an additional labor cost for the people that serve the food.

How do you figure?

Crew billeting is fixed. Only enough cabins for X number of crew members. (Unless they're going to start hot bunking. 🤣) There will just be reassignments. Additions in some places and reductions in others

Edited October 14, 2020 by klfrodo

[time4u2go]

Just now, klfrodo said:

How do you figure?

Crew billeting is fixed. Only enough cabins for X number of crew members. There will just be reassignments. Additions in some places and reductions in others

Reassignments from what?  What would these crew members be doing if they weren't serving food in the Windjammer?  They can't just add labor without adding manpower to perform it.

[livingonthebeach]

23 minutes ago, time4u2go said:

Also those that are tallying up the savings are not considering that there will be an additional labor cost for the people that serve the food.

 

How much does a WJ get paid?  Probably less than people waste on throwing out food.

[time4u2go]

1 minute ago, livingonthebeach said:

 

How much does a WJ get paid?  Probably less than people waste on throwing out food.

Could be, but it's still a factor in the savings.

[ReneeFLL]

5 hours ago, mariner6 said:

My point is more about quality.

Quality of food, services, shows and quality overall.  Do you think quality will be less once Royal starts or less?..

I'm sure there will be less quality. It's an easy way to cut corners.

 

4 hours ago, drsel said:

I was about to say that they may have a plated service, instead of an unlimited buffet.
And issue coupons so that you cannot have a second helping.

One coupon for breakfast lunch and dinner for each day.
Also coupons for tea, coffee and dessert. No self service tea, coffee or juice.

Limited coupons will never fly.

 

I would love to see the buffet having crew serve the food. I don't think people will waist (pun intended) as much and no nasty fingers on food.

[Ourusualbeach]

1 hour ago, livingonthebeach said:

 

Don't know about some of these but there one thing for sure -- the shore excursions will be through the ship and they can charge whatever they want or you don't get off the ship.
 

Some activities which are included now could become for-a-fee activities.  I.e. lectures, classes,  etc.  I hope not, but they have to make their money back somehow. 

While cutting costs may be seen by some as the easy way to quickly return to profitability it needs to be done very carefully so as not to damage the brand.  Short term savings do not translate into long term profitability.

 

I do see reduced staffing but that’s to be expected given they will be sailing at less than 50%.  Some venues may be closed and some events may not happen but those are all temporary measures that have to do with social distancing.
 

I do not see Royal starting to charge for things that were previously free nor do I see a rapid decline in the quality of food on board.  I also do not see gouging on the shore excursions.  Reports from other lines in Europe have been that the excursions were in line with previous prices.
 

The  last thing Royal needs to do now is alienate those that are willing to sail.  
 

 

 

[Ourusualbeach]

49 minutes ago, Baron Barracuda said:

If I were a TA I'd be nervous.

Quite the opposite.  Many lines are offering incentives to travel agents.  Travel agents still represent the majority of their bookings and greatly influence many new to cruising as to what line they will sail on for their first time. 

[livingonthebeach]

8 minutes ago, Ourusualbeach said:

While cutting costs may be seen by some as the easy way to quickly return to profitability it needs to be done very carefully so as not to damage the brand.  Short term savings do not translate into long term profitability.

 

I do see reduced staffing but that’s to be expected given they will be sailing at less than 50%.  Some venues may be closed and some events may not happen but those are all temporary measures that have to do with social distancing.
 

I do not see Royal starting to charge for things that were previously free nor do I see a rapid decline in the quality of food on board.  I also do not see gouging on the shore excursions.  Reports from other lines in Europe have been that the excursions were in line with previous prices.
 

The  last thing Royal needs to do now is alienate those that are willing to sail.  

 

I really hope you are right and there is a return to profitability that doesn't compromise quality and value.  However, I don't think it can be accomplished.  There is a past history of putting profits before anything else, which has already alienated many.  I understand they exist to make profits but some of the practices need to be revisited, IMO. 

[Ourusualbeach]

1 minute ago, livingonthebeach said:

 

I really hope you are right and there is a return to profitability that doesn't compromise quality and value.  However, I don't think it can be accomplished.  There is a past history of putting profits before anything else, which has already alienated many.  I understand they exist to make profits but some of the practices need to be revisited, IMO. 

They only alienated people as long as they could keep the ships sailing full and profits kept rising.

 

With ships not sailing anywhere near full they need to make sure they keep the people spending thousands coming back and not losing them for the sake of $20 here and there.

 

There are much bigger savings to be had by right sizing the fleet of ships....getting rid of the smaller less profitable ships that back when they had an abundance of people willing to cruise made sense to keep but now with a reduced demand they no longer make sense.  Look at Carnival Dropping pretty much an entire class of ships.  They have done some major trimming and while eliminating a good % of their passenger capacity it was a small % of profits and they will emerge a more profitable company in the long run. 

[ReneeFLL]

5 hours ago, drsel said:

They may follow Costas example and have restricted hours for dining.

just 2 hours for breakfast, 2 hours for lunch and 2 hours for dinner both in the buffet and in the main dining room.

Like 8.00 to 10:00 a.m. 12 to 2 p.m. and 7 to 9 p.m.

 

They may also charge for drinking water, ice cream, room service, steam and sauna, tickets for shows.

 

Ultimately, they may even charge for dining in the main dining room and keep only the buffet free! Lol

 

 

 

Does Costa have other food options available during additional hours?

 

2 hours ago, livingonthebeach said:

 

Don't know about some of these but there one thing for sure -- the shore excursions will be through the ship and they can charge whatever they want or you don't get off the ship.
 

Some activities which are included now could become for-a-fee activities.  I.e. lectures, classes,  etc.  I hope not, but they have to make their money back somehow. 

If they are still having shore excursions thru the ship after this is what vet then that will limit my cruising. Sometimes we just like to get off the ship and walk around. During covid I can understand why they want to keep people in a bubble as much as possible.

[Iamcruzin]

8 hours ago, drsel said:

I was about to say that they may have a plated service, instead of an unlimited buffet.
And issue coupons so that you cannot have a second helping.

One coupon for breakfast lunch and dinner for each day.
Also coupons for tea, coffee and dessert. No self service tea, coffee or juice.

Before they start handing out food stamps I would hope that they would eliminate the unlimited happy hours for Diamonds and above.

[HaveWeMetYet]

16 minutes ago, Iamcruzin said:

Before they start handing out food stamps I would hope that they would eliminate the unlimited happy hours for Diamonds and above.

The alcohol they serve Diamonds costs about 20 cents a shot.

[eric1e]

I think we’ll see costs go up across the board in small amounts such as fees for specific cabin selection or preferred seating and things of that nature. Also seems like they’ll be able to regain a lot of money via excursions by enforcing you to take their excursions and increasing costs as a “safety” fee. 
 

I also do think they are probably spending a lot of time right now figuring out how to cut a lot of costs related to itineraries, port fees, and fuel costs. 

[fla gang]

I think they will greatly reduce the ports of call and do many more sea days just to keep the revenue coming. People are so hungry to cruise, and keeping them onboard and spending that money may be the best thing for the company. Cruises to nowhere aren't bad if you just want to relax!

[Missusdubbya]

9 hours ago, Iamcruzin said:

Before they start handing out food stamps I would hope that they would eliminate the unlimited happy hours for Diamonds and above.

Sounds like a terrible idea 😁😁😁

[drsel]

Costa has breakfast from 8 to 10 and extended breakfast still 10.30 am
Lunch from 12 to 2 and tea with sandwiches and cookies and pastries from 4 to 5 p.m. and dinner from 7 to 9 p.m.
Other than this, the pizzeria is open in the evening, but it is chargeable

[travelhound]

On 10/14/2020 at 9:02 AM, klfrodo said:

My thoughts only

The only thing constant in life is change.

Covid-19 has changed everything we knew and loved in life

There WILL be changes in the cruise industry

Improvise, adapt, and overcome

Well said, it may not be exactly the same, but we will be cruising again 🙂

 

 

[Milwaukee Eight]

11 hours ago, HaveWeMetYet said:

The alcohol they serve Diamonds costs about 20 cents a shot.

NA aka New Amsterdam, might be less than that. Lol. Very few quality alcohol on the Diamond list. Bud Light is ok. 😇

[Baron Barracuda]

18 hours ago, Ourusualbeach said:

Quite the opposite.  Many lines are offering incentives to travel agents.  Travel agents still represent the majority of their bookings and greatly influence many new to cruising as to what line they will sail on for their first time. 

We'll see, but given their financial situation there can't be any sacred cows.  Once upon a time airlines paid nice fees to TA''s too.   And that younger demographic they're trying to attract prefers self-serve shopping.  Go online, browse websites and click on the vacation you want.  Just look how online shopping has displaced bricks and mortar.