Show Concession sales have few kernels of good news John Horn Los Angeles Times Moviegoers tend to stuff themselves full of salty popcorn and sweet candy But when people of the multiplex as audiences have done for three consecutive consecutive consecutive tive years manufacturers of theater snacks are left with a sour taste in their mouths Much has been made that declining movie admissions and office box-office grosses have clipped earnings for movie studios i and film exhibitors But audience apathy also is taking a bite out of the concession business and particularly hard hit are companies companies companies com com- that rely on movie theaters for the bulk of sales Its kind of scary Its It's been going downhill downhill downhill down down- hill for three years says Paul Bonfiglio whose Summit Food Enterprises has laid off a third of its employees because of worsening sales for its movie theater candy line which includes PJ P.J. Bears Concessions Cont on Page 2 s L Lr r k py F t ER 1 p vai v S Jim Labas represents Weaver Popcorn at the convention convention convention con con- in Las Vegas The company says its theater sales have fallen about 10 percent over the last several years Concessions Cont Cant from front Adds Norm Krug chairman chairman chairman chair chair- man of the Nebraska farmers farm farm- ers cooperative Preferred Popcorn Our sales are going down pretty directly with attendance As the movie theater industry's annual convention came to a close here March 16 organizers organizers organizers orga orga- tried to characterize the office box-office slump as asmore asmore asmore more media propaganda than business predicament Hollywood studios were on hand to offer peeks of the animated features Cars and Over the v. Hedge and clips from Superman Returns Mission Impossible ill ID illand and Poseidon all in an effort to rally interest in upcoming movies But on the trade show floor of the convention of theater owners candy and popcorn peddlers trying to drum up business for their products were decidedly uninspired It doesn't help that theater theater theater the the- ater owners have been raising raising raising rais rais- ing the prices of Bears and popcorn in response to the downturn an astronomical markup that the concession sales representatives never see Just 30 worth of raw popcorn can translate into as much in sales at atthe atthe atthe the movie theater counter I dont don't think that raising raising raising rais rais- ing prices at the concession concession concession conces conces- sion stand is the way to do doit doit doit it said Frank Liberto whose Ricos Products Co introduced the chips-and- chips cheese nacho snack at theaters theaters theaters the the- aters 30 years ago An audience survey released recently by Nielsen Analytics found that more than 36 per- per moviegoers polled said they were going to fewer films because concessions concessions concessions con cessions are too expensive sive The top reasons for staying away high ticket prices and bad movies John Fithian president of the National Association of Theatre Owners said movie concessions concessions concessions con con- cessions were fairly priced when compared with theme parks and other out- out of-home of entertainment Were it not for concessions concessions concessions conces conces- Fithian said ticket prices would be twice as ash h high gh Fithian said he was unaware of any study that tracked overall theater concession spending The National Association of Concessionaires did not return telephone calls seeking comment For many exhibitors concession sales can mean the difference between profit and loss and often total more than a third of a achain's achain's achain's chains chain's office box-office revenue Exhibitors generally return about half of all office box-office receipts to movie studios as film rental fees Conversely they keep the majority of candy counter income concession profit margins can run above 85 percent At Regal Entertainment Group the largest the theater ter chain in the US U.S. with more than screens concession sales last year generated million in revenue more than a quarter of Regal's total income But Regal was one of the only publicly held chains to show healthy growth for what are often unhealthy snacks Even though Regal's concession sales were up in its most recent fiscal year the average amount of concessions sold per customer over the last three years has not kept pace with the rise in average average average aver aver- age ticket prices Domestic theater admissions admissions admissions fell nearly 9 percent- percent last year to 14 billion tickets tickets tickets tick tick- ets sold th the third consecutive consecutive consecutive tive year of decline After the billion admissions in in 2002 the turnstile slowed to billion tickets tickets tickets tick tick- ets in 2003 and billion billion billion bil bil- bil- bil lion tickets in 2004 according to the Motion Picture Association of America That's why popcorn merchants see few kernels of good cheer Weaver Popcorn Co said its theater theater theater the the- ater sales had fallen about 10 the last several years But because the company also makes microwave popcorn it benefits when film fans stay home and rent and cook their own snacks In an attempt to boost slumping sales for the 41 farmers who are part of his cooperative Preferred Popcorns Popcorn's Krug has been pushing popcorn in theaters theaters theaters the the- aters in Japan India and Russia The office box-office drop has caused us to bemore be bemore bemore more aggressive in foreign markets Krug said JJ Snack Foods Corporation said only a tiny piece of sales for its snack products Minute Maid Soft Frozen Lemonade and the new among others others others oth oth- oth- oth ers came from theaters Still the company feels the downturn tiT We c count every penny said Jerry Law a JJ Snack Foods representative representative representative at Last year was a bad year Well We'll see see what kind of movies they have for this summer |