Quote:
Originally Posted by Calgary14
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
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I guess I was referring more to the operating margin. 96% sounds pretty sweet as a margin, but the operating margin is more relevant to a theater and if people understood that better I think they'd be less hostile/critical of concession prices.
Not backpedaling or disagreeing with you...I just think movie concession pricing needs to be viewed in terms of operating margin versus basic margin on individual concession items. I didn't explain my point well so your explanation is appreciated.