Industry Survey
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According to the Concessions Industry Data Initiative Survey, the Concessions and Hospitality Industry is an important economic engine that stimulates the economy, provides job opportunities and supports not-for-profit organizations with fund raising opportunities.
Goals & Drivers
The project was driven by repeated inquiries for deeper information about the Concessions and Hospitality industry by industry members, trade press, regulators and legislators. The goal was to gain a deeper understanding of operational practices, benchmarks and economic impact of the business.
Methodology
The online survey was conducted in early 2014 in affiliation and by Florida International University Chaplin School of Hospitality & Tourism Management. The project was headed up at FIU by Dr. Miranda Kitterlin. The survey was distributed to the Concession Operator members of the National Association of Concessionaires (NAC) and to members of the National Association of Theatre Owners (NATO). The number of responses received represent 47 percent of NAC Operator Members.
The impressive response, coupled with the impartial and academic execution, underscore the validity and future application of the findings.
Participants
Survey participants included movie circuits; professional, college and minor league sports venues; municipal park and recreation departments; family entertainment centers; convention centers; performing arts venues; amusement parks and more.
Survey Participants
Theatre Circuits 36%
College Sports Venues 16%
Major League Sports 8%
Minor League Sports 7%
Park/Rec 9%
Family Entertainment 7%
Convention Centers 8%
Performing Arts 1%
Amusement Parks 1%
Other 5%
Per Caps
Perhaps the key benchmark finding is that patrons of these venues spend $7.31 on a per capita basis. That fact, combined with the finding that the surveyed companies hosted over 212 million guests per year, produced $1.5 billion dollars in annual revenue for the surveyed companies alone.
Theatre circuit operators reported per cap of $3.80, which has been corroborated by 2013 NATO data which shows per cap of $3.75. The higher overall concession operator per cap is driven by much higher per caps in sports venues, family entertainment centers and amusement parks.
Operator Per Caps
Theatre Circuits $3.80
College Venues $5.17
Major League Sports $13.28
Minor League Sports $15.02
Park/Rec $10.91
Family Entertainment $8.84
Convention Centers $4.36
Performing Arts $2.50
Amusement Parks $5.82
Product Mix
Carbonated Beverages made up almost 29 percent of the product mix sold by these operators. Popcorn (15%), sandwiches (11%), pizza (8.5%), and hot dogs (8.5%) bring in the next tier. Candy (6%), healthier options (4%) and nachos (4.3%) are also key contributors.
Seventy-seven percent of our surveyed operators reported some kind of alcoholic beverage sales. Of those who do, alcohol represents almost 22 percent of their revenue.
Twenty-nine percent of respondents said they sell concession items as a package with ticket or admissions fees. This represents 7.8 percent of these respondent’s revenues.
The traditional concession stand drives a larger portion of revenue than catering services. Operators reported that almost 79 percent of their revenue comes in at the concession stand versus 21 percent though catering operations.
The Labor Picture
Concession Operations is a labor intensive business. These surveyed companies reported that 22 percent of their revenue is spent on direct labor costs. Fifty-five percent said they hire from 1-10 Full Time Equivalents (FTEs), sixteen percent said 11-50 FTEs, 4 percent said 51-100 FTEs and Twenty-four percent said they hire over 100 FTEs.
A whopping thirty-seven percent of the companies also use volunteer groups to augment their labor force. The companies who employ this practice estimate that they contribute over $9 million dollars to these groups annually.
Key Findings
-The survey was conducted by an impartial source from the academic community.
-The Numbers represent 47 percent of NAC Concession Operator Members, which is a significant representation and projectable to the entire industry. Early corroborations with other industry groups are promising.
-Survey participants Per Cap average is $7.31 in sales.
-These companies host over 212 million guests/customers/patrons each year.
-This group contributes over $1.5 billion to the economy from this sample alone!
-Concession operators offer diverse menu offerings.
-These companies provide jobs.
-These companies provide over $9 million in fund raising for not-for-profit organizations.
Next Steps
This summary is the first step in the release of this initiative. Next steps are to include deeper “by vendor type” category analysis, continued corroboration with other industry groups and sources, creation of industry size projections and an informational media and government relations campaign.
Questions and other inquiries may be directed to Dan Borschke, Executive Vice President of NAC at dborschke@naconline.org or Chris Dammann, Director of Communications at cdammann@naconline.org.
