Cinema snacks: a view to a killing

Two buckets of popcorn. Photo: Alamy

Perhaps it had to happen eventually. Joshua Thompson, a Michigan “security technician” furious at being prohibited from carrying his own food and drink into the cinema, last week filed a class action against a large American cinema chain. His lawyer claims that for AMC to charge around $8 for a Coke and some chocolate-covered peanuts amounts to price gouging. A professor of business law at Eastern Michigan University has called the suit “a loser”, but Thompson is not the only cineaste horrified by the price of snacks.

From a business point of view, cinemas are only partly about films. “When we bought [Odeon],” Guy Hands of private equity group Terra Firma famously said, “the management team really believed they were part of the film business. I had the difficult job of explaining to them that they were in the popcorn-selling business.”

Cinemas are obliged to split money from ticket sales with the film studios, but get to keep almost all the cash they make from selling food. That means that the “concessions” (popcorn, sweets and the like) make up 20% of a cinema’s revenue but 40% of its profits. A box of popcorn is around 85% profit to the cinema, and salty foods of course encourage people to buy more soft drinks, increasing receipts further. “Without the hefty concession profits,” declared an article in Time a few years ago, “there would be no movie theater business”.

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