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TOPIC: What is your concession markup?

What is your concession markup? 02 Nov 2007 10:25 #27389

  • puzzlegut
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We are in the process of increasing our concession prices. We're wondering what percentage everybody uses to markup their popcorn and pop products.
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Re: What is your concession markup? 02 Nov 2007 14:00 #27390

  • Mike Spaeth
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We try to keep overall food cost between 13 and 15 per cent.
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Re: What is your concession markup? 02 Nov 2007 14:48 #27391

  • slapintheface
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NO clue my cost per serving on soda
i cgarge what i think the market will pay!
soda
small-3.50
med--3.95
lg 4.49
popcorn
small-3.75
med--4.50
lg--4.99
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Re: What is your concession markup? 16 Nov 2007 01:44 #27392

  • markegge
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There's probably no exact "formula" for how much you should mark up your soda and popcorn (well, no, there is ... set P where MR=MC ...). Going to your local Carmike or other major chain theater and checking out their prices is probably about the best "gage" of "what the market can hold".

My theater is subsidized by student tuition dollars, so we try to balance our mark-up between what people WOULD pay ... and still making students feel like they're getting a pretty good deal.

We sell 44oz, 84oz and 128oz bags of corn for $1, $2 and $2.50, respectively.

We sell 16oz, 24oz and 32oz sodas for $1.50, $2.00 and $2.50, respectively.

In both cases, for accounting purposes, which consider the costs of inputs to be negligible. But for the sake of curiosity..

Assuming a 30x expansion ratio (where 16oz (weight) of kernels yield 480oz of popped corn (volume)) ... and an average price of $0.0213 per oz of kernels ... and charge an average of $0.0655 per oz of popped corn, we charge ~307% markup on our popcorn.

Assuming we charge an average of $0.0833 per oz for soda... and it costs us $0.0117 per liquid oz ... that's a 710% markup ratio.

I'm aware that we could make more money selling larger sizes ... but I refuse to have MY theater contribute to America's obesity. =)
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Re: What is your concession markup? 16 Nov 2007 09:52 #27393

  • lionheart
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Welcome to the forums, Mark. Thanks for the great breakdown on cost of goods sold and markup.

I disagree with you on your comment about not selling larger sizes because you don't want to contribute to obesity. (There may be other reasons I wouldn't sell larger sizes, but the customers' dietary requirements won't be one of them.) Of course, large servings are possibly above any recommended allowance of sugar or fat for a serving or maybe even for an entire day (I don't know the exact figures). However, I tend to think that an evening out at the movies is a luxury in the first place. If a person wishes to splurge and get the supersize everything, I would be happy to take their money.

Since the average American attends movies about 5 times a year, I don't see how splurging on those rare occassions is really going to hurt them much. It is up to the individual to ensure their dietary intake is correct over the long term.

You should also consider that some people share the larger sizes. It can be part of the romantic experience when on a date to share popcorn and/or soda. If they are going to be swapping spit later, a little backwash isn't going to kill them. Families or friends may share larger sizes as well.
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Re: What is your concession markup? 16 Nov 2007 19:17 #27394

  • markegge
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Touché, lionheart. The calorie count in popcorn is really low, and we don't serve real butter. And Flavacol ... aside from being carcinogenic (which SURELY it must be), is probably not that "bad" for you, health-wise. It's just chemicals...

You may have provided the rationale that I need to up my soda sizes. I --DO-- feel rather silly, selling a 16oz soda at a movie theater.
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Re: What is your concession markup? 16 Nov 2007 23:59 #27395

  • lionheart
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I noticed over the last few years that when I go to Burger King, there is no small soda on the menu. If you order a small you get what is called a medium on the menu board because it is their smallest size. They sell medium, large, and extra-large (or some similar name).

This struck me as odd, but I realized that it was their way of upsizing the order without having to ask to do it. If they had re-labeled their medium as "small", their large as "medium", and their extra-large as "large", would it have accomplished the same thing? I don't know. Maybe they wanted to limit the number of sizes available to keep things simple, and at the same time upsize some of the orders, and have something to offer for super-sizing.

I don't think a 16 oz soda is necessarily silly, but you might consider calling it a child size or something like that to discourage most people from ordering it. Seems to me that you shouldn't provide drink or popcorn weights/volumes either unless you are asked. Labels like medium, large, and extra-large, are all you need. I think big numbers might discourage some people from buying the larger sizes. I know I've purchased a large soda before and then realized when I received it that it was larger than I really wanted. In that case, many people will simply not drink it all, but they already payed their money. That's good for the seller. The customer shouldn't mind because they knew the cost before they ordered. Hopefully, they will think they got a good deal. Not everybody looks around to see how big a cup is before ordering. A lot of people will focus on the menu board and not see the sample cups that you probably have displayed. Your regulars will know better, but remember many people are not regulars these days.

Seems to me I remember Burney Falls saying she had removed the number of ounces from her drink menu and had replaced it with the simpler small, medium, and large labels. She said it helped sell more soda, and consequently made her more profit. From the per cap figures she has posted in these forums, we should all pay attention to what she is doing at the concession stand.



[This message has been edited by lionheart (edited November 17, 2007).]
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