Cracking the Code: Why Airport Food Comes with a Hefty Price Tag

While airport amenities and standards may differ depending on the location, one thing is always the same: airport food is extremely expensive! Whether you are booking cheap flight tickets to India from USA or any other foreign country, there is one thing in common with the price of food at airports. That is to say, for everything from cooked to packed, the costs are two or three times higher than the market. Well, there are a few important reasons for that such as high rent prices, delivery costs, etc. It is not, however, the only reasons for the astronomical cost of food. In this article, we examine the main causes of why airport food comes with a hefty price tag.

1. Exorbitant Rents

Renting space at an airport is a challenging process. The shops have to pay a premium for the small space they have at the airport. They give the airport authorities an arbitrary sum of money. To be clear, airport levies are based on total sales, thus a retailer’s obligation to pay the government increases with his sales volume. As a result, they increase food prices to maximize profits. The authorities permit this because they are aware of the inner workings and have chosen to stay out of the way, allowing the shops to remain open.

2. Higher Operational Expenses

Despite widespread belief attributing airport costs to a 3000% markup compared to other prices, simply because passengers are compelled to stay at the airport and consume whatever is offered, the true causes prove to be a little more complicated. First of all, cargo is sent to airports in small amounts and has to go through many security inspections at strange hours. As a result, the labor and ongoing transportation expenses mount. Because of this, store owners have to raise product prices a lot to keep their business profitable while covering these costs.

3. Demand and Supply

When setting a price, one should consider the demand for the goods. For example, airports strictly forbid bringing in outside food due to high-security concerns. Consequently, passengers are compelled to eat at the pricey airport restaurant if they need to eat or drink. In summary, various factors, including security concerns, restrict the amount of goods that these airport stores can supply. Consequently, the supply and demand are out of balance. And as it always does, when demand outpaces supply, prices will rise. This scenario is similar to finding the cheapest business class flights to India from USA. The demand for affordable luxury travel is high, but the supply is limited.

4. Labor Charges

The airports are often situated some distance from the center of the city. As a result, businesses have to pay a portion of their employees’ daily travel expenditures and give them more money than normal in order to get them to the airport. The staff must undergo certain training programs to prepare for service and effectively meet demand. The workforce actually has to pay for parking, make the daily trip to the airport, and put up with lengthy security checks. All of this drives up the product’s price and raises the company’s operational costs. The cost of operating the business and the price of the product both increase as a result of all of this. When we purchase a bag of chips, a samosa, or a dosa, we are essentially buying a small portion of the laborers’ pay.

5. Lesser Competition

There is a known limit to the amount of space that an airport can have. Because of the limit on the number of locations it can support, retailers gain from less competition. Airports are aware that company owners are ready to pay for the virtually guaranteed business provided by the steady stream of travelers. The escalating customer demand and lack of competition among dining options have caused price increases, which dining establishments then pass on to the client.

6. Insufficient Storage Areas

As we’ve already mentioned, airports are high-security areas, and delivering the goods to the company involves navigating a bureaucratic process. To put it simply, companies need to invest in an off-airport warehouse and distribution system in order to get the product to the counter. The increased complexity compels customers to pay outrageous prices as a result. If they can’t, they’ll need a lot of deliveries throughout the week, which will drive up costs even more.

7. Electricity is a Fixed Price

Many non-airport businesses can look for ways to reduce operating costs, such finding a less expensive source of electricity. Unfortunately, there are restrictions on airport food retail establishments in this region as well. And electrical supply is frequently fixed at a set cost. Electricity powers the heating, air conditioning, and lighting systems at airports, even before you step foot inside the terminal or approach an aircraft. The terms of their lease may require airport food vendors to pay more for these kinds of utilities.

Conclusion

In conclusion, a perceived monopoly is not the only factor influencing the cost of airport food. High commercial space rental expenses, markups on suppliers, staff churn, and parking fees are all major factors. So the next time you reserve last minute flight tickets to India from USA, pack extra snacks in your cabin bag or pay the extra money with a smile on your face since you won’t be itching to find out why the fares are so high.

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