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TOPIC: Concessions priced too high = lower per cap

Concessions priced too high = lower per cap 13 Dec 2007 15:41 #27404

I watch a lot of movies in the larger towns down the road to preview them before I play them--or just to watch something I know I will not play, but I want to see and be able to talk about.

In the last six months I have watched their popcorn and soda prices increase twice. Their small popcorn is now more than my large. When they raised their large popcorn to $5.00, I stopped buying a soda to go with my large popcorn purchase. For shame, I now bring my own bottle of water. So, as a result, they are making less money off me now than they did before, as I used to always buy the large soda to go with that large popcorn.

Two weeks ago, I noticed they raised their popcorn prices again. I paid no attention to the soda price, as I don't get them there anymore. But, about half-way through The Golden Compass last night I was getting sleepy, so I went out to get a refill on my popcorn. She said their refills are no longer free and they now charge 50 cents for the refill. Wow.

Don't you think there is a saturation point in raising concession prices that must be figured in before you overprice the product? Raising prices too much effectively lowers your profit does it not?
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Re: Concessions priced too high = lower per cap 13 Dec 2007 17:42 #27405

I keep fighting raising my prices with fear of losing sales, as I am in a very depressed area. BUT with all the increases in costs, it is really having a bad impact on bottom line. I don't know if the other theatres here have seen all the price increases I have in the last year for all product. Cocunut oil up over 70%, popcorn almost 100%, the buckets I rather use than bags---and top it all off with ever increasing fuel delivery charges---and that is before even getting into the operating cost increases. I was doing so much better 5 years ago.
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Re: Concessions priced too high = lower per cap 13 Dec 2007 17:48 #27406

  • tratcliff
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Yes, I agree with you that prices at most multi-plexes have gone too far.

Just look at the PC.
We small town theatres with what I think are reasonable prices ( so my customers say also ) are doing roughly the same in PC.

So if we have the same PC, then less customers percentage-wise are buying concessions at the big guys.
Eventually there has to be a breaking point where their PC will start to go down because of price increases driving customers away from the concession stand.

I also think this is why they feel the need to have all sorts of new high-end choices and regular food (which is not as high in profit margin at just popcorn and soda).

Now of course that means we may have more food cost for what we sell. BUT, we also have happy customers who come back for more movies. It's one of our best weapons for completing.
Plus if all I sell is popcorn, soda and candy, not the high-end, costly items, I wonder just how much higher my percentage of costs of goods sold actually is.

And lastly, I can sleep a little better at night.
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Re: Concessions priced too high = lower per cap 14 Dec 2007 01:54 #27407

  • slapintheface
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Why get less than the big guys (not me).

I sleep better when all my bills are paid!
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Re: Concessions priced too high = lower per cap 14 Dec 2007 14:25 #27408

  • rodeojack
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This is such a subjective issue, it's hard to know what is "reasonable". To be sure, the perception is that the chains overprice their products. One of the more successful chain outlets around here does very well at the boxoffice, but not so much at the snack bar. They have something like 6 or 8 sales positions, but I've never seen more than 2 behind the counter.

I get $5 for a cheeseburger. Comparable sit-down places charge at least that much. At the same time, you can get a drive-through gut bomb for a buck or so. My pizza prices are about mid-range for the area. Sit-down pizza shops are somewhat higher... the drive-through "take 'n bakes" are lower.

I'm amazed at some of the prices I see at drive-ins in the central states... $2.50 cheeseburgers, $1.25 hotdogs, $1.50 popcorns & $.75 sodas. These same theatres constantly complain about being "on the edge". Maybe they are, but I see a lot of underselling at drive-ins, and I can't see any good reason for it.

Years ago, a fellow owner told me that the time to raise prices is when you're so full you can't make more money by improving the product. There may be some truth in that. Still, there's a perception that deeply discounted products are priced that way to compensate for problems elsewhere, so maybe you can go overboard both ways.

My feeling is that price is somewhat secondary to how you present the product... within reason. If the customer perceives they're getting an outstanding value, there's less reason to be concerned about the price. They very well might think you're the most expensive popcorn in town... but if they believe you have the best popcorn... for whatever reason... I'd bet you don't get a lot of complaint. I see this when I go to places like "Outback Steakhouse", or "Olive Garden". Neither of these restaurants could be called cheap, discount, or even inexpensive. You can get what they sell at lots of places for a lot less money. Still, both places provide a product and an atmosphere that I think is worth the OCCASIONAL splurge. It's not an everyday thing, and that makes it more special.

Everything I sell here can be bought somewhere else for less, though you'd have to go get it. You can also find everything I make somewhere for more. I'm happy with the balance, and the majority of my customers appear to be good with it, too.

For you? You'd have to decide what's reasonable for your area. If you're near New York City, you might get away with a $10 hamburger. In farm country, maybe not... but I'd bet your overhead would be lower there, too.
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Re: Concessions priced too high = lower per cap 19 Dec 2007 02:52 #27409

Today I went in and now they have four sizes of popcorn. Their large is now a 170oz, I think, and sells for $5.75, while the 130oz. is still $5.25. If you want that 50cent refill though, you must buy the 170 oz. So, in effect, that is four price increases in the past six months.

Maybe now they are finally making enough to pay their bills, since they finally turned the heat on in the auditoriums.
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Re: Concessions priced too high = lower per cap 30 Dec 2007 07:15 #27410

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Its a visious circle our costs of product go up and operating cost go up so at some point we must raise prices or decrease the size which for sum may not be a bad idea 170 oz popcorn 64 oz soda is a bit much. will we sell more with small size but a biger profit margin? perhaps perhaps not but it may be worth trying especially if your finding popcorn and soda containers in the theaters with product in them when you clean up. but also calling a 85 oz popcorn and a 32 oz drink a small realy does not give them much of a choice unless you have offered a smaller size and it has not sold then the customer has spoken an you dont need a smaller size

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