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Just How Expensive Is That Bag Of Peanuts?  
User currently offlinecaleb1 From United States of America, joined Nov 2008, 353 posts, RR: 3
Posted (2 years 2 months 3 weeks 5 days 14 hours ago) and read 14933 times:
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Having flown United for quite some time, I have to admit that I miss the way they used to give a small bag of peanuts or other snacks to passengers along with a beverage. Just wondering, how expensive is it for United and other carriers to provide these small snacks to passengers? Is it really that cost-prohibitive? I know that Delta, Alaska, and possibly Frontier still offer free snacks to passengers and I don't think this practice has had much of an adverse effect on their bottom line, if any. So, why not give us passengers a little something to show that we are still appreciated. It can't cost that much, or can it?

61 replies: All unread, showing first 25:
 
User currently offlinemrskyguy From United States of America, joined Aug 2008, 1214 posts, RR: 3
Reply 1, posted (2 years 2 months 3 weeks 5 days 14 hours ago) and read 14814 times:

It's a simply value added vs. weight/cost saved approach that many airlines have been following for over a decade now. One of the more famous early approaches to this was AAL's removing 1 of 3 olives from first class salads to save some thousands of dollars (figure eludes me now).


"The strength of the turbulence is directly proportional to the temperature of your coffee." -- Gunter's 2nd Law of Air
User currently offlineUALFAson From United States of America, joined Mar 2004, 693 posts, RR: 4
Reply 2, posted (2 years 2 months 3 weeks 5 days 13 hours ago) and read 14626 times:

I completely agree with you. I think it's insanely tacky that an airline the size, scope, and prestige of United can't be bothered to give a complimentary bag of pretzels or snack mix or something, especially on a 2-3 hour flight.

Before she retired, my mom got complaints on almost every flight about the lack of a snack with the beverage service.

I would argue that this is something that's not about what it costs, but what it costs in loyalty and customer satisfaction NOT to do it. Unfortuantely, no one buys plane tickets solely on the basis of whether or not they get a handful of free trail mix, so the bean-counters who run airlines these days have taken out their scissors and knives and cut this amenity.

(In their defense, it's not so much about what one bag of nuts costs, but what 150,000 bags of nuts each day cost and what tens of millions of bags a year cost.)



"We hope you've enjoyed flying with us as much as we've enjoyed taking you for a ride."
User currently offlinemax550 From United States of America, joined Nov 2007, 1147 posts, RR: 0
Reply 3, posted (2 years 2 months 3 weeks 5 days 13 hours ago) and read 14570 times:

Here's a recent article about airline food.
http://www.nytimes.com/2012/03/11/bu...n-flight-meals.html?pagewanted=all
Toward the end they mention that DL saved $210,000 a year by removing a single strawberry from salads in first class.

Unfortunately when you're barely making money you need to cut every cost you can, keeping in mind that you don't want to lose passengers. Since there are probably very few passengers who wouldn't fly a certain carrier because they don't offer peanuts it's an easy expenditure to cut.


User currently offlinerdh3e From United States of America, joined Mar 2011, 1582 posts, RR: 2
Reply 4, posted (2 years 2 months 3 weeks 5 days 13 hours ago) and read 14540 times:

Quoting caleb1 (Thread starter):
Is it really that cost-prohibitive?

So some back of the envelope calculations that are probably WAY off but should ballpark it for you.

From some old stuff I had lying around carrying 20lbs on an average flight will cost anywhere between .50c and 1.25 depending on stage. So thats your fuel penalty for carrying your peanuts. Which is basically nothing really. If you're giving every passenger a 1 oz bag of peanuts its only about 10 lbs for 140-160 people so less than a buck.

Then take probably .25c per bag incl catering, (and thats a total guess) and thats $35 for 140 people.

So you're at about $36 per flight for 140 people which is .257 per passenger. We'll just call it .26 because someone had to do the work to arrange the contract and oversee the procurment etc.

Then figure UA mainline did over 100M passengers in 2011, so $26M dollars savings approximately.

I will say I have NO idea if any of this is true, and i'll let others decide if that sounds about right.


User currently offlinejcavinato From United States of America, joined Jan 2005, 520 posts, RR: 0
Reply 5, posted (2 years 2 months 3 weeks 5 days 13 hours ago) and read 14423 times:

It was Voltaire, who wrote (in the 1700s): "Accountants know the cost of everything but the value of nothing."

I think of that every time I'm on a 2-3 hour flight and there isn't even a small hand out snack.


User currently offlinebrilondon From Canada, joined Aug 2005, 4113 posts, RR: 1
Reply 6, posted (2 years 2 months 3 weeks 5 days 12 hours ago) and read 14324 times:

Quoting jcavinato (Reply 5):
I think of that every time I'm on a 2-3 hour flight and there isn't even a small hand out snack.

I don't really see the need to eat on a flight that is only 3 hours long. There are plenty of food outlets at the airport. I also don't find the food airlines serve to be all that appetizing or plentiful. I would like it if there was a way of bringing my own food on board, I don't like peanuts myself.



Rush for ever; Yankees all the way!!
User currently offlineBD338 From United States of America, joined Jul 2010, 701 posts, RR: 0
Reply 7, posted (2 years 2 months 3 weeks 5 days 12 hours ago) and read 14302 times:

Quoting jcavinato (Reply 5):
It was Voltaire, who wrote (in the 1700s): "Accountants know the cost of everything but the value of nothing

Lord Darlington in Oscar Wildes Lady Windermere's fan (1892), he was answering a question about who is a cynic. But the sentiment remains exactly the same for an accountant IMHO and applies to the question. It's an oddity of human psycology but you can take a lot away from someone but it's the little things they always remember and complain about the most. The poster above suggests $26M a year, the logic seems OK but I bet the volume of peanuts they would buy means they pay nowhere near 25 cents a bag, so the real cost is probably a bit lower. Do airlines need to give away peanuts etc. probably not, as a small customer relations exercise is it worth the effort? maybe, it's one of those little things. There again, there's always the group that will complain about anything...No peanuts/only got peanuts/boy that steak in first class was tough! etc. etc. so the airline can't really win.


User currently offlineAirframeAS From United States of America, joined Feb 2004, 14150 posts, RR: 24
Reply 8, posted (2 years 2 months 3 weeks 5 days 12 hours ago) and read 14283 times:

Quoting caleb1 (Thread starter):
I know that Delta, Alaska, and possibly Frontier still offer free snacks to passengers

AS, yes. F9 no. The cookie is gone per the Frontier threads. WN still has the "free" snacks.

Quoting caleb1 (Thread starter):
So, why not give us passengers a little something to show that we are still appreciated.

Customers always want something for free. Why not add a couple dollars to the ticket to pay for such snacks? But then again, people are like "Why should I pay for his when I don't want to pay for it?"



A Safe Flight Begins With Quality Maintenance On The Ground.
User currently offlineKC135TopBoom From United States of America, joined Jan 2005, 12128 posts, RR: 52
Reply 9, posted (2 years 2 months 3 weeks 5 days 12 hours ago) and read 14240 times:

It is not about the peanuts, or any other snack or beverage. It is all about the bottom line. If an airline can save $26M per year on just peanuts and snacks, then cutting out the free beverage, Coke, Pepsi, or what ever, that they are not selling can save even more. A 12 ounce can of Coke or Pepsi is served to two passengers, in the small plastic cups. For a flight carrying 150 passengers, that is 75 12 oz cans they are carrying, that is about 56 lbs, not counting the weight of the empty cans. 56 lbs added to 1000 flight per day per airline means they are carrying around 56,000 lbs of dead weight each day, system wide, or more than 20.4 million pounds per year. So how much extra fuel is burned by the airline just to carry around 12 oz cans of Coke?

User currently offlineIslandRob From US Virgin Islands, joined Apr 2011, 138 posts, RR: 0
Reply 10, posted (2 years 2 months 3 weeks 5 days 12 hours ago) and read 14173 times:

Maybe the airlines could offer a choice: you either get an inflight magazine, or a bag of peanuts. Those heavy magazines must cost a fortune, both in terms of procurement and fuel (to fly them all over creation). -ir


If you wrote me off I'd understand it, Because I've been on some other planet, So come pick me up... I've landed
User currently offlineYflyer From United States of America, joined Feb 2007, 1003 posts, RR: 1
Reply 11, posted (2 years 2 months 3 weeks 5 days 12 hours ago) and read 14165 times:

Quoting brilondon (Reply 6):
I would like it if there was a way of bringing my own food on board, I don't like peanuts myself.

  There is a way to bring your own food with you on board. You put a bag of chips or trail mix or a sandwich or whatever your favorite snack is in your carry-on bag and bring it onto the airplane. I do it all the time. As long as there's no liquid involved it's fine.


User currently offlineEASTERN747 From United States of America, joined Oct 2006, 514 posts, RR: 0
Reply 12, posted (2 years 2 months 3 weeks 5 days 12 hours ago) and read 14105 times:

When I worked at Eastern, a good part of my time was in "dining services", both in the field and in the executive offices.(MIA)
The problem wasn't really the basic cost of of the bag of nuts, it was the fact we had to pay the caterers a fee to handle them and board them. (I'm sure bags not used we recycled and we were recharged) Thank you Marriott! I believe the cost was @.25. We had the same thing with olives!. There used to be a 3 part container that had lime wedges, lemon wedges, cherries for drinks. One big discussions was cartons of milk. Because we had to ice to chill stuff, the milk was suppose to be replaced every time we were catered. Can you imagine the $$$$$......Did you ever wonder why the egg slices on your salads were all the same size...even in coach?.........WADA eggs....raw egg whites put in a tube, with an inner tube filled with egg yokes....hard boil and slice. Every slice the same....FYI


User currently offlinePPVRA From Brazil, joined Nov 2004, 8938 posts, RR: 40
Reply 13, posted (2 years 2 months 3 weeks 5 days 11 hours ago) and read 14070 times:

The reason they don't cut beverages but cut peanuts is because it's easy to defend beverages while it's hard to defend peanuts.

The people who criticize accountants don't really understand accounting and it's purpose in the first place, so they wouldn't know that accountants aren't the ones who determine that United won't be serving peanuts any longer. If it was as simple minded a decision as people claim this to be, then planes would be flying without free water and free soda, as alluded to above.

When times are lean, management may challenge certain "nice to haves" and the people in the company (should be a product department of some sort) who are responsible for the peanuts on board have to back up their argument that spending however many millions of dollars a year on peanuts is a good idea. Easy to do with free drinks, not so easy with peanuts. Accountants provide management across the organization with information, they don't decide peanuts stay or go.

[Edited 2012-04-26 16:04:45]


"If goods do not cross borders, soldiers will" - Frederic Bastiat
User currently offlineViscount724 From Switzerland, joined Oct 2006, 24786 posts, RR: 22
Reply 14, posted (2 years 2 months 3 weeks 5 days 11 hours ago) and read 13995 times:

Quoting IslandRob (Reply 10):
Maybe the airlines could offer a choice: you either get an inflight magazine, or a bag of peanuts. Those heavy magazines must cost a fortune, both in terms of procurement and fuel (to fly them all over creation).

But inflight magazines generate a lot of revenue from advertising.


User currently offlinejcavinato From United States of America, joined Jan 2005, 520 posts, RR: 0
Reply 15, posted (2 years 2 months 3 weeks 5 days 11 hours ago) and read 13974 times:

As a CPA I can tell you that it is possible to analyze and come up with whatever number anyone (a boss) wants. One big part of any cost analysis is how do you allocate the fixed costs. There are 17 basic ways. You can come up with 17 different answers. So you can use which ever one you want to come up with whatever number you want to prove your case.

I have been on company boards where we are presented in-depth cost savings projects to approve, and when most things are held the same over the next month or so we never see any of the savings from the cuts that were in the project. It's like if one passenger didn't make the flight and the seat went empty, the plane with 130 seats does not experience a cost reduction of 1/130th of its flight costs. So many of the fixed costs remained the same.

So, I do not believe that the company saved $25 million by eliminating the peanuts. The only thing that really matters in a cost savings is how much less of all the checks do you write after the decision was carried out. Did you get to actually eliminate something that costs you something on an on-going basis?

Transportation economics are weird compared to manufacturing industry costs. For one, the costs of an outbound truck run are greatly tied to the revenue and direct and fixed costs of the return one. How you divide up the costs between the two is often largely a flip of the coin decision.

This is why it's harder to be a transportation manager than one in other industries. Too, how do you compete against another company that is in bankruptcy? Or, the worse competitor is one that does not know how to compute its operating costs at all. They price at whatever gets them the most cash in the short term. In the meantime, they dragged everyone else down.

Who said life was easy?


User currently offlineIslandRob From US Virgin Islands, joined Apr 2011, 138 posts, RR: 0
Reply 16, posted (2 years 2 months 3 weeks 5 days 11 hours ago) and read 13942 times:

Quoting Viscount724 (Reply 14):
Quoting IslandRob (Reply 10):
Maybe the airlines could offer a choice: you either get an inflight magazine, or a bag of peanuts. Those heavy magazines must cost a fortune, both in terms of procurement and fuel (to fly them all over creation).

But inflight magazines generate a lot of revenue from advertising.

They can print little ads all over my peanut bag. I promise to read them all, and I'll be in a better mood, hence more susceptible to the ads, 'cause I'm not so hungry. Everybody wins. -ir



If you wrote me off I'd understand it, Because I've been on some other planet, So come pick me up... I've landed
User currently offlinePPVRA From Brazil, joined Nov 2004, 8938 posts, RR: 40
Reply 17, posted (2 years 2 months 3 weeks 5 days 11 hours ago) and read 13931 times:

Quoting jcavinato (Reply 15):
So, I do not believe that the company saved $25 million by eliminating the peanuts. The only thing that really matters in a cost savings is how much less of all the checks do you write after the decision was carried out. Did you get to actually eliminate something that costs you something on an on-going basis?

The weight saving argument is too far out there for me, even though I understand the idea. I'd use the actual cost the airline pays for it and any type of logistics/catering costs involved in getting the peanuts onboard.

As with anything in accounting, there are proper and improper methods for specific situations, and then there is the professional judgement aspect to it too.



"If goods do not cross borders, soldiers will" - Frederic Bastiat
User currently offlineplaneguy727 From United States of America, joined Mar 2007, 1239 posts, RR: 1
Reply 18, posted (2 years 2 months 3 weeks 5 days 11 hours ago) and read 13827 times:

For give my simple view, but you buy a plane ticket for transportation, not food. It's not like you go into a restaurant in Chicago and complain 2 hours later when you walk out and aren't in NYC.


I want to live in an old and converted 727...
User currently offlineIslandRob From US Virgin Islands, joined Apr 2011, 138 posts, RR: 0
Reply 19, posted (2 years 2 months 3 weeks 5 days 11 hours ago) and read 13788 times:

Quoting planeguy727 (Reply 18):
It's not like you go into a restaurant in Chicago and complain 2 hours later when you walk out and aren't in NYC.

But I might complain if, during the course of the meal, the staff didn't serve me a free glass of water. -ir



If you wrote me off I'd understand it, Because I've been on some other planet, So come pick me up... I've landed
User currently offlinefrmrCapCadet From United States of America, joined May 2008, 1710 posts, RR: 1
Reply 20, posted (2 years 2 months 3 weeks 5 days 9 hours ago) and read 13644 times:

Detroit kept taking 25 cents here, 50 cents there out of their cars. You know what happened. Pretty soon they were POS. Peanuts themselves are not the question. It is the all over quality of service. Last time I was on SW, they offered me a few extra packets of peanuts. I did not ask for them. But, I am diabetic, and it meant I did not have to stop at a restaurant on the way home, which I did not want to do, it was about a two hour drive. Do I remember. You bet I do.


Buffet: the airline business...has eaten up capital...like..no other (business)
User currently offlinemjzair From United States of America, joined Nov 1999, 398 posts, RR: 1
Reply 21, posted (2 years 2 months 3 weeks 5 days 9 hours ago) and read 13541 times:

The point of air travel is to get from point a to point b.
I find it hard to believe anyone cares about a shiny little bag containing what, 15 peanuts. How come no one complains about getting on a city bus and not getting a snack.... Train travel is pretty popular outside the US, yet the times I have taken the train, I have never gotten anything for free.
I understand that this may seem like a degradation of service, but really, does the snack option really influence the carrier of choice?


User currently offlineusdcaguy From United States of America, joined Jan 2004, 948 posts, RR: 2
Reply 22, posted (2 years 2 months 3 weeks 5 days 8 hours ago) and read 13490 times:

Quoting jcavinato (Reply 15):

So, I do not believe that the company saved $25 million by eliminating the peanuts. The only thing that really matters in a cost savings is how much less of all the checks do you write after the decision was carried out. Did you get to actually eliminate something that costs you something on an on-going basis?

I wholeheartedly agree with this. It seems like personally, whenever I cut something I really like out of my budget, like eating at nice restaurants, I end up spending the money on something else. In that scenario, I often will end up buying more groceries or fast food, the cost which needs to be factored into the savings. Also, what will I replace an evening at a restaurant with? A night at the bar? $30 on cocktails to me is a catastrophe compared to $40 at a nice restaurant. Not only would I have to eliminate the restaurant to save the amount I would spend at a restaurant but also the desire to go out on Saturday night, get out of my house or go on a date.

For the airline, this "replacement paradox" could translate into something as indecent as executive bonuses given in lieu of peanuts or something as innocent as more staff to answer customer questions about upgrades. Also, what could is happen is that management might wait a year, and after seeing more money sitting around, decide to refurbish the offices at headquarters and end up saving $0 in the second year. In the end, money spent on the customer is money spent making THEM happy. Money taken away from customer expenditures and forgotten about makes management look good and eventually gets them rewarded financially. And perhaps it makes them happy as well, but they sure are fewer in number than the passengers.


User currently offlinemdavies06 From United Kingdom, joined Aug 2009, 381 posts, RR: 0
Reply 23, posted (2 years 2 months 3 weeks 5 days 8 hours ago) and read 13389 times:

What about the cost of crews? Surely this has to be accounted for as well?

As a novice observing, I have noticed that airlines which do serve free food on board (e.g. BA, QR) have 5 and even 6 crews on board an 320/737 type plane to serve business and economy, whereas in airlines which do not serve free food (e.g. FR, EZY) the number of crews on board is usually 3-4. Therefore, I would say that the cost of serving peanuts, biscuits, bird seeds or whatever is not just from the cost of food and caterer, but the cost of crew as well.


User currently offlinePDX88 From United States of America, joined Mar 2012, 165 posts, RR: 0
Reply 24, posted (2 years 2 months 3 weeks 5 days 6 hours ago) and read 13172 times:

Quoting brilondon (Reply 6):
I would like it if there was a way of bringing my own food on board

There's no rule that says you can't. I always bring my own food on the plane.

I love watching passengers dump their half full drinks into the garbage cans right before they board a flight because they think the no liquids rule applies to going on the aircraft. If it's past security (solid or liquid), you can take it on the plane.


25 BA777-236 : You can laugh all you want about peanuts being worthless but I flew United back last fall and will never fly them again. I flew HNL-ORD - an almost NI
26 AirframeAS : You have no right to complain as you said yourself: You were prepared and your own snacks. All because you were prepared and had your OWN snacks? Rea
27 faro : For an airline with USD 32 billion in revenues in 2010? Sad, very sad... I would wager if you took into account: i) the salary + benefits of the pers
28 RIXrat : In the above postings I saw the weight issue being brought up several times. If weight on a plane is so critical, why don't the airlines weigh every p
29 Post contains images cmf : Based on what is he not allowed to have an opinion on the product offered? That he knows what it is before setting foot on the plane or even before b
30 anamericanin : That was not the case for me in Istanbul when I was connecting there. Could not bring a bottle of pop purchased at a machine in the gate area on to t
31 CPHFF : Inflight Magazines are a source of revenue. Free Coke is not. I have colleagues who have worked with "Holland Herald" (KLM) and "Scanorama" (SK) Infl
32 EaglePower83 : B.S. I flew OGG to to LAX and in conjunction with the drinks, they had snack boxes AND full sandwiches and salads for sale. A turkey sandwich or asia
33 Post contains images anamericanin : I flew ORD-HNL and had regular drink service - they gave me full cans each time (I'm a bit of a pop fiend). They did have Pringles but they had a dec
34 cmf : There is no free coke. How including it changes revenue depends on multiple factors. Nickel and diming often has a negative effect on long time reven
35 SouthernDC9 : I can remember when people would complain about the bag of peanuts being all they got on a flight, and what a joke that was. If they gave out peanuts
36 Post contains images NASBWI : I think it depends on the airline, and what exactly it's offering. At B6, for example, up to 6 different complimentary snack options are offered. The
37 Rara : He's got every right to complain. Nine hours with just beverage service is pathetic, whether he knew it in advance or not.
38 B6A322 : It all comes back to penny-wise, pound foolish. Internationally I tend to fly *A, but domestically I tend to fly either Delta or jetBlue. On my most r
39 Tbone354 : Peanuts? Not in today's climate. Lordy, Lordy, someone on the plane might be allergic and sue for millions. And they'll get it! There is your "cost".
40 Post contains images rdh3e : err, you know, the direct variable cost of purchasing the peanuts.... so yeah.... But probably not complain if you didn't get the free bread right? W
41 Flaps : IMHO we have already reached such a low level of inflight service, why not just ditch the service altogether? I cant remember the last time that I eve
42 SouthernDC9 : Honestly, until I started reading this thread I had no idea that peanuts had such enormous power to make people feel better about themselves and thei
43 Post contains images N126DL : I thought I was the only one who said that...
44 aeroblogger : Exactly. US tried to charge for soda, and it backfired big time on them. Even today, you can find people who say things like "I'm not flying on US Ai
45 cmf : But I'm much more likely to go back to the restaurant that include bread. Welcome to the world of smart customer relations. Where you take slightly s
46 PI4EVER : I think US got the most grief for their attempt to charge for water, on top of soft drinks and discontinuing the pretzels and peanuts. After a recent
47 rdh3e : Definitely understand your sentiments. I can tell you that UAX doesn't cater jet flights under 220mi, so as a comparison I'm not sure what US's rule
48 B727FA : I'm sure it's similar at most carriers, but I know "American Way" is an item that is required to "pay for itself" every year. If the ads and revenue
49 litz : A few years back, I was on a flight where someone stopped off at The Varsity on their way to the airport, to pick up something to eat on the plane. T
50 SouthernDC9 : On my most recent Eagle flight, if I remember correctly, there was American Way magazine, plus the AA first class magazine, plus the American Eagle m
51 xero9 : I don't have any real information to add to this, however.. I flew with Porter Airlines for the first time this Christmas, and I felt like royalty. Ha
52 OURBOEING : I would rather not have peanuts served in the flight. Simply because the number of people with nut allergies have grown quite drastically and please n
53 DTWLAX : Let us not even get there. I have to disagree with you that US Airways is the best managed airline in the States. They cannot even get their East and
54 SkyCub : I have to say that I find it interesting that USAir still receives so much bashing for their attempt to charge for water and soft drinks. While I did
55 Post contains images Skydrol : Flying makes me hungry. Don't need a PTV, eating is my IFE. I usually turn off the PTV; if airline X offered PTV/IFE and airline Y offered a full hot
56 BA777-236 : I'm not complaining.. I'm stating my opinion because it pertains to this thread. While my family and I were prepared, it's only because I knew to loo
57 rogercamel : The selling of food on board is one of the key reasons all free food was stopped - even a pack of peanuts would damage the revenue stream of selling
58 Viscount724 : The advertisers pay to insert their ads in the magazines which I assume in most cases more than covers the production and printing costs. That was th
59 bobloblaw : Excluding catering costs, the actual cost of peanuts or pretzels is about 2-3 cents per bag.
60 brilondon : [/quote=BA777-236,reply=25]I would have happily paid for a meal on the plane, but no.. they don't have any! My next flight to Hawaii will be on Air Ca
61 B727FA : That doesn't follow with DL.
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