From the July/August issue of the Rinksider:

Maximize snack bar profits by taking a sneak peek at other entertainment venues

By Susan Geary

If you’ve ever wondered how movie theaters and sports stadiums are able to command $5 for a soda, you’re not alone. For years the industry has charged far more than roller skating facilities and convenience stores for the same size beverage. How do they do it?

Larry Etter wrote a book on the topic, titled “The Concessions Class with a few condiments,” covering this topic as well as the nuances of snack bar management. Etter should know, he’s a Senior Vice President at Malco Theatres and also serves as the Director of Education for the National Association of Concessionaires. Topics such as employee hiring and training, menu design, cost control, customer service, technology, and inventory management are also covered in his book. A few highlights include:

 

Finding great workers

“If you’re looking for cashiers, talk to people who work in banks, people who handle money,” said Etter. “If you want people out on the front end, greeting people, you want gregarious, happy, smiling faces.” He recommends if you run into a great barista at a Starbucks, give them your business card and say, “Listen, if you’re ever looking for a job, give me a call.” It doesn’t mean they’re going to call right away, but at some point, he explained, he gets at least a 20 percent return on those business cards that are passed out.

 “When you find great people, they typically want to stay around if you treat them right, so you don’t have much turnover. And the less turnover you have, the more money you save, because it’s very expensive hiring, training and reproducing quality employees.”

 

Conducting the interview

Etter teaches a catalog of classes, and one of them is how to hire the best employees. There is a process, he explained. For one, don’t ask yes/no questions. “You ask questions that tell you what type of person they are.” For example: if you’re talking to a 16-year-old kid and you’re interviewing him for the job you might ask, “What’s your favorite beer?” If they say Budweiser, you know they drink beer, and that’s probably not the person you want to hire. What kind of car do you drive? If it’s a Volkswagen you know they’re probably pretty conservative. Or if they don’t have a car and ride the bus you know they’re going to have problems with transportation getting to and from work.

Etter has a list of about 20 different questions that profiles people without them knowing they’re being profiled. Other questions include, how often do you go to the gym? That tells you whether or not they exercise. Do you do any extracurricular activities? What was the last book you read? This reveals whether they go to the library or if they read regularly.

 

Managing Inventory

“You should turn your inventory over in the concessions business at least once a month,” said Etter. Inventory is actual cash, and with the best inventory you need to get 18 turns a year. Food service suppliers, such as Sodexho and Sysco are not interested in selling anything in low volume, which is why many rink operators rely on warehouse clubs like Costco and Sam’s. However, he warns of losing control when using the clubs, because “it’s very easy for your employees to buy those same Snickers bars, bring them in and sell them out of their pocket without you knowing it and collecting the cash.” He refers to that situation as a silent partnership. It’s also why he recommends using cups with a logo rather than a plain generic cup that are easily available at a local grocery store, to thwart internal theft.

 

Justifying higher prices

There is no substitution for quality, explained Etter. “People don’t mind paying four or five dollars for a drink, as long as its quality. That 89 cent drink at the convenience store may not have enough carbonation or it’s watered down.” He added, “If you make a hot dog, you should have the best ingredients, a fresh bun, and the highest quality condiments.” Customers are willing to pay more for quality, rather than buy cheap, inedible food.

He shared this final thought about the concessions industry. “Every time you sell something in your snack bar, you carry the flag for everybody. The perception is cheap and awful, or a great experience.”