Sunday, September 16, 2007

Candy Wisdom for the Masses

There are some things in life that everyone knows to be true. Time flies when you’re having fun. It always rains the day after you wash your car. The price of candy at the movies is outrageously overpriced.
The story is universal at all movie theatres. A customer will belly up to the candy stand to order a box of popcorn and a soda. He’ll ask the concession worker how much a small popcorn is. When the minimum-wage paid employee recites the various prices, the response is almost always the same. “Four dollars for that! Is it gold plated or something?” or, “For that price you should have to sing me a song too.” The employee will give a polite, half-hearted chuckle, offer butter on the popcorn and think to herself “I’m not the one pricing the popcorn, so why is this guys getting upset with me.”

The price of snacks your local movie theatre is high, ridiculously high, but for a reason. Theatre owners are not looking to gouge you on candy because you’re trapped inside with no way out, starving and thirsty, hoping to get a snack fix. There isn’t an evil man, twirling his mustache in the back room, laughing maniacally every time someone buys a box of Juju B’s. In fact, most theatres have a very lax, don’t ask-don’t tell policy on bringing in your own food if it is well hidden. The reason the prices are so high is that concession is the only place where theatres make any sort of profit.

If the theatre is running with a minimal crew of only five staff members; box office attendant, usher, concession worker, manager and projectionist, and assuming that all staff are paid minimum wage, including the manager, one movie would have to bring in seven paying customers (at a ticket price of at least $9.00) just to cover the cost of wages for its employees. That number does not include the price of rent, the cost of gas and electricity or any of the other odds and ends that theatres owners have to pay for to keep the doors open. Additionally, that number is loosely totaled since most theatres only make a (sliding scale) percentage of the box office profits, having to share the rest with the movie’s distributor.

With the high cost of showing a movie, and the increasingly declining attendance numbers at the average movie theatre, the only way to make a real profit is through concessions. The mark up on candy averages 200 percent and is as much as 300 percent in come cases. The candy isn’t any better than what you buy at the market. Cost does not follow the rule of supply and demand. The only reason movie theatres continue to stick it to consumers in the snack department is that by charging an exorbitant amount for your popcorn, they are able to turn a profit and continue to offer you a nice, relaxing evening at the movies.

So the next time you patronize your local movie theatre, make sure to stop by the candy stand and stock up on the over-priced snacks. You might even want to say thanks to the underpaid employee. After all, it takes them two hours to make what you just spent on a box of popcorn and a coke.

1 comment:

Michael J. Fitzgerald said...

Nicely done, though I still think Goobers are a little overpriced...

I would be interested in a future column that delves more deeply into the business side - for example, what does it cost to rent the movies that are shown, how much is rent for theater space, and how much profit do they make on that box of Goobers?

You could use several theaters to compare...