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Comment by tomjen3 | Hacker News Reader

Agreed, this is not what you sign up for when you go to the movies. They should focus on improving the experience of their customers, instead of finding new ways to screw them over.

Oh and reduce the cost of popcorn - seriously it is a joke.

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http://www.gsb.stanford.edu/news/research/hartmann.popcorn.h...

For the past 80 years concession prices have been used to keep ticket prices artificially low, to increase the number of film goers, which helps the theaters stay busy, creates the "experience" (I've yet to be in a crowded theater and someone actually hold up a conversation, or answer a cell phone), and most of all allows greater profits to go to the film companies and allows bigger better quality films to be produced.

It's not a joke, it's a sound business strategy. Just like how Coca-Cola and Pepsi have two-dozen drink products each even though 78% of Coca-Cola's gallon sales come from actual "Coca-Cola".

This is similar to how I walk into the grocery store and see beef packaged at $1/lb even though I have a relative in the meat packing industry, that actually packages the meat for my local store and he says they (the meat packers) can't sell it for less than $1.50/lb without making a loss.

Do you have a source for this?

"Just like how Coca-Cola and Pepsi have two-dozen drink products each even though 78% of Coca-Cola's gallon sales come from actual "Coca-Cola"."

I'm just curious because I'd be shocked if 78% of Coca-Cola's sales by volume were from actual Coca-Cola. They don't have dozens of drinks, they have hundreds.

I was curious too, so I looked it up.

Wikipedia also quotes the 78% number, citing Coca-Cola Co's 2005 SEC filing [1]. However, a cursory read of their SEC filing reveals this: "In 2005, concentrates and syrups for beverages bearing the trademark "Coca-Cola" or including the trademark "Coke" ("Coca-Cola Trademark Beverages") accounted for approximately 55 percent of the Company's total gallon sales." [2] It's possible the 78% number the Wikipedia article is drawing from is based on a newer SEC report which isn't cited correctly.

Edit: I Looked up their 10-k from Feb 2010 and found this: "Trademark Coca-Cola Beverages accounted for approximately 51 percent, 51 percent and 53 percent of our worldwide unit case volume for 2009, 2008 and 2007, respectively." [3] So it looks like Wikipedia may have incorrect information!

[1] http://en.wikipedia.org/wiki/The_Coca-Cola_Company#Revenue

[2] http://www.sec.gov/Archives/edgar/data/21344/000104746906002...

[3] http://ir.thecoca-colacompany.com/phoenix.zhtml?c=94566&...

I hope you edited the corresponding wikipedia page.

I stand corrected, it sounds like the ~55% figure is "Coca-Cola" products as in Original, Diet, Diet Caffeine Free, Zero, Diet with lemon, etc. I wonder if the 78% figure is from Coca-Cola 'company' drinks, like Sprite, Fanta, etc and the remaining 22% is subsidiary sales like Vitamin Water (Energy Brands subsidiary), etc.

Next time you go into a store, look at the price of 12 packs of coke. Stores usually buy them for around $3.85-$4/12 pack now (but a 'case' is 2 12 packs), and that price doesn't change much from state to state.

You'll notice they typically go on sale below that right around the holidays. It's so they can advertise to get you in and buy other stuff.

Stores like Winco and Costco usually sell coke close to cost. They don't actually get it cheaper than any other grocery store. In fact, most grocery stores will outsell costco when it comes to 12/24 packs. The cost/profit ratio is usually more constant at these places.

I've noticed that Safeway is particularly bad at inconsistent prices (hugely varying cost/profit ratios). They're sales are decent, but everything else is super inflated to make up for it.

I almost forgot to add this. 4 2 liters is the same "case" that 2 12 packs are. So while you typically get more value out of a 2 liter, they usually have a higher markup.

You'll almost never see them go on sale below cost.

No, the popcorn is just a subsidy for the film. It allows cheapskates like me to have a cheaper entrance fee without popcorn.

The studios take more than 75% of the ticket price for themselves. The popcorn is keeping the theatre owner afloat.

Yes. And without the popcorn, that money to keep the theatre owner afloat would have to come from somewhere else, e.g. the ticket price.

yes, but...

$10 ticket + $10 concessions = $10 net revenue (%25 of the ticket and %75 on concessions)

$20 ticket + no concessions = $5 net revenue.

It is the same reason CEO's take $1 salaries and stock grants/options. Salaries are taxed at %36-9 but long-term capital gains tax is only %15.

Yes. Though we wouldn't know whether the percentage rates would stay the same, if concessions weren't allowed. The current rates were negotiated with concessions in mind.

Studios take a sliding scale percentage. On some new releases, 100% of the ticket price for the first week is taken, sliding to 25% after six weeks. For a theater to make money from the actual movie, they need films like Titanic or Avatar that had extended runs, otherwise, most of the income is purely from concessions. Coke and Pepsi sell their product extremely cheaply to many theaters (and shopping malls if they can work exclusives) for the branding rather than the profit.

And yet all those films make a loss !

Holywood needs some better (or worse) accoutnants

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