Quote:
Originally Posted by Sliver
If true, that has to be ignoring all other costs other than the material cost of the concession items, which is no way for a business to calculate their actual margin. Those buildings are huge and are probably second only to churches for how inefficiently they're used. Sale of concession items subsidizes all the times the building is costing the owner money, but not generating any income (mornings, most weekday matinees, etc.).
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Two different things - gross margin and net income. Gross is the actual cost of the product (ie. the popcorn kernels, butter, bag etc). Those are very high margins because they're very cheap. Same for pop, the plastic cup costs more than the actual pop itself.
Net income takes into account everything you mentioned - overhead, building, staff, etc.
Usually when someone talks about margins they're talking about how profitable a specific item is (ie. cost of the item is $1 and it sells for $20).
For subsidizing income, that's where they tend to get creative - ie. birthday parties, sporting events, corporate meetings, etc - anything for additional income to supplement the core business of movies
I think Cineplex is trying really hard to get people out, and hopefully it works. Curious if Landmark offers something similar soon to remain competitive