Layoffs

[wsapooh]

I was also thinking that just getting people to travel again who were previously frightened post 9/11, is a step in the right direction. So many people have been concerned about traveling and things like this are just the incentive they might need to get them out the door, on to those planes, and into WDW. Once they've taken the trip, they might realize that they can't live in fear. That they can travel and that the odds of something tragic happening to them is SO slim. And then, they'll go again and again!

It really is amazing how much fear is out there and how many people are choosing to stay home. Hearing that WDW was one of just a few "no fly zones" made people realize that WDW is a good terrorist target. So they're staying away in fear. Now I certainly don't agree with this attitude. It's just what I've witnessed as a travel agent. So enticing them with a deal like this may just be the push they need to lay those fears aside.

Things like this may not show a rising profit right away, but may make a difference down the road.

Just another point of view

 

[MrPromey]

Originally posted by wsapooh
Things like this may not show a rising profit right away, but may make a difference down the road.

Just another point of view

I whole heartedly agree

 

[careship]

I agree with all of you as well. We need to get the people out again. Starting to travel again. They'll get there and see there is nothing to be afraid of and will go back to vacationing again. Quite probably back to DIsney again and again. It's also a way to get those people who have always said it was too expensive to go and they'll get the Disney bug too and be return visitors.

 

[wsapooh]

Yes, and they will then see how much magic they get for their money.

 

[no2apprentice]

I have no idea how strong the Craft Maintenance Council is, but at the risk of trying to read between the lines, Disney must have had some very convincing numbers to lay on the table for a union to agree that lay offs was going to be the best option for all concerned.

Too bad we don't have any hard numbers about how off-property hotels/motels are doing.

 

[PhotoDave219]

This from the Associated Press:

Walt Disney World is laying off about 100 carpenters and decorators, the company said Monday.

The cutbacks represent less than 2.5 percent of the resort's maintenance staff. Expected to benefit are hundreds of other workers who had their hours reduced in April from an average of 40 hours a week to an average of 35 hours.

"It doesn't reflect a change in our business because, in the end, the hours are about the same level as they were before," Disney spokeswoman Rena Callahan said.

The union representing about 4,000 plumbers, carpenters and electricians was approached by Disney for negotiations last week, and employees were informed Monday.

"It came to a point where we had the difficult decision to make between maintaining the reduced hours for the whole Craft Maintenance Council or to reduce the workforce and reinstate the 40-hour work week," Callahan said.

A message left with a spokeswoman for the Craft Maintenance Council was not immediately returned.

An uncertain economy was blamed for the April cutbacks. The workers who had their hours reduced still maintained their benefits.

With about 54,000 full-time and part-time jobs, Walt Disney World is central Florida's largest employer.

 

[niteobsrvr]

This situation didn't play out exactly as it sounds.

Sure attendance levels and revenue still aren't where the company would like them to be but laying off workers in a skilled area seldom makes sense for a company. That is of course unless the prognosis for the downturn in business is long term.

Also firing the lowest 100 workers on the seniority list doesn't save Disney any money because their hours will be distributed to the remaining more senior and higher paid workers.

This is a case of the Union forcing Disney into this situation. The Union and its more senior members were not happy about the reduced work schedules. These members felt that since they had been there the longest, they should be able to keep their hours and let the lower guys jobs fall where they may. Union teamwork at its best.

This has been a recurring theme since 9/11 as the company tries to cope with the ups and downs of events beyond their control. The unfortunate side here is that as things do pick up and the workers skills are once again needed, it will be harder to attract qualified candidates and in the long run the layoffs will cost them even more. This is why Disney has avoided lay offs as much as possible.

 

[BradleyJ]

Originally posted by tigsmom
If the place is so crowded, why are they laying people off?

Crowded is such a relative term.

To Some people it may seam crowded. Especialy comaped to whats crowed levels had been in the last 2 years.

But crowds are still way below to levels seen in durring the Millenium Celebrate and the Highs in attendance seen durning the 25th Aniversary.

 

[tigsmom]

you will always get larger crowds during special celebrations. I think they are worried about the "everyday" visitor.

 

[BradleyJ]

Originally posted by tigsmom
you will always get larger crowds during special celebrations. I think they are worried about the "everyday" visitor.

But the Point is that they are not any where near that "Normal" level.

If they were, they would not be able to have closed Carribean Beach and Port Orleans for the extended periods that they have.

The point is, that while more crowed than they have been recently. They have not made it back to what would be concidered a Normal Level.

 

[miles1]

I think it's possible for the resort occupancy to be up without the park attendance going up appreciably.

How?

If a family of four was planning a trip to WDW this year and planned to stay outside the property to fit in their budget (i.e., my family), they suddenly found they could stay inside the property, and gain the ammenities for the same price. Who would stay at the HoJo's on 192 when they could stay at a Disney resort for the same price?

Either way, they were planning on visiting the parks, so there's no change in the park attendance, but the resorts are more fully booked.

If they can't boost park attendance, they are at least covering the enormous overhead of operating what would have been half empty hotels.

Does this make sense or should I have skipped the Margaritta with dinner?:hammer:

 

[tigsmom]

makes sense to me.

 

[PhotoDave219]

Like someone said, it looks like the Union forcing Disney's hand into some sort of action. Its 100 people out of 54 Thousand. I think everythings gonan be fine.

 

[Woody13]

Let's get real! The Pop Century is still not open. WDW visitation is currently at an all time low. Resorts discounts are ubiquitous and WDW has 7,000 too many rooms right now. Nothing is going to change until international travel resumes. That is the bread and butter for WDW. WDW is currently pandering to local markets, but locals can't fill the void. What WDW needs is a healthy influx of Venezuelan teens!

 

[RickEff]

Originally posted by MrPromey
That means they are getting the same amount of money but having to do more to get it.

Well - it's better than getting NO money which is what the case would be if they didn't show up at all.

 

[gjpjtj]

This thread has got me wondering......We have reservations for September 5-15, had similar ressies last year.
Crowds were low, (and quite frankly we enjoyed it). I know most children are either in school, or starting school that week.

What is everyone's take on how the Fairytale package will affect attendance during this period?

 

[Dayma]

Although attendance may be higher than last year Disneys pure expenses for M:S and Everst may be catching up to them. They simply may just be sinking a ton of money into new projects and the ticket revenue may not be keeping up with it....imo

 

[MrPromey]

Originally posted by RickEff
Well - it's better than getting NO money which is what the case would be if they didn't show up at all.

Oh, I am in no way disputing that. My point is that as they have to spend more to get less, their profits fall. As discounts increase, profits decrease and at the end of the day, the bottom line reflects net profits over gross intake.

If they offer a room at half price, that means they have to fill two rooms to make what would otherwise be made with one. That means, that in order for them to make more money with the discount, they have to fill at least three rooms which means more maid service, more electricity, more water and toiletries and so on. They are paying to maintain three rooms but only making the profit of one and a half rooms. Now add to this, signifigent discounts on park admission and you run into the exact same thing there. Sure, people are likely to spend more on merchandise as a result but all Disney is really doing is trying to make up for what they have lost on the discounted rooms and admissions…

To put it into better perspective, say tomorrow you went into work and your boss told you that you weren’t getting a raise this year because the company couldn’t afford to offer it. On top of that, because they had to let a few employees go, they are now going to move you from hourly pay to salary and that in so doing, they are going to require you to now work 55 hours a week instead of 40 while still only getting paid for the 40. On top of that, they because some of the people let go were in positions related to yours, you are going to have to expand your job responsibilities by 33% to help cover what the now missing employees did… there are two ways you can look at this: If we were to look back at Disney’s, yours would be that you should be happy because you still have a job. Those people who were let go don’t. Mine would be that you may have a job but you are now having to work 33% harder and 38% longer to make the same amount of pay you made yesterday. (guess I’m a glass half empty kinda’ guy)

Do you get my point? For some time now, Disney has been under considerable pressure from investors to bring profits up and all I am saying is that it is difficult to move forward when you are already having to work twice as hard to just stay where you are. As long as this promotion is part of some kind of strategy to get people traveling back to WDW again, it is sort of a cost of marketing. If it is an attempt to increase short term profits by filling empty rooms and parks, the benefits are not as great as some people seem to think they would be.

 

[careship]

Just a side thought....

I wonder what kind of tax write-off Disney gets for giving away the 3 days for the FTP? I know that in my business if I give something away with a purchase, I get a write-off for that.

 

[niteobsrvr]

Originally posted by careship
Just a side thought....

I wonder what kind of tax write-off Disney gets for giving away the 3 days for the FTP? I know that in my business if I give something away with a purchase, I get a write-off for that.

I believe they also would have the opportunity to impact their earnings in the same way.

The bigger question is whether or not Disney factors in the cost of the discounts in their pricing. When things are going great, they eliminate discounts vs charging a premium because the market will support the higher price. Then, when things take a downturn, they institute the discount amount, but are still meeting their internal earnings expectations. Of course, this means Wall Street doesn't get a rosy picture compare to years past and disney still must trim some fat that was related to the "premium" pricing.