Why are food and beverages (F&B) expensive in Cinemas?
- There is no need or incentive to match market price inside a cinema, as once a person enters a theatre, there is no outside competition.
- According to what PVR Chairman Ajay Bijli told to Economic Times, the Indian theatre has seen a transition in these years. The theatres are changing from single screens to theaters, and the process is still underway. There is a cost difference between both of them.
- A significant earning from the Box office is shared with studios or distributors, so the cinema halls rely on concession stand earnings for their revenue.
- The primary spending in a cinema hall is on tickets, not food. People are not bound to take it. The cost of F&B is high as it stands as secondary spending.
This is what India’s Largest Multiplex Chain, PVR, Chairman Ajay Bijli said:
- He believes India has a vast potential to grow in this market and is still under-screened.
- When people feel happy about what they are getting, they don’t complain about the price, as expenses are a function of quality. After the theaters came, the expenditure increased, as earlier, there were single screens with one projection room, one sound system, and mostly no air conditioning, he stated.
- He also said that people are happy with the expenses and the quality they are offered, or else they wouldn’t have done the kind of F&B sales they have achieved.
