Sports business threatened by inflation, gas prices, concessions as fans return

Sitting on a bench in front of Soldier Field watching his beloved Chicago Bears play in person, money wasn’t exactly a big concern for Corey Metzger.

Or any worries, really.

“This journey has been a long time in the making, and I’m spending whatever I’ve got to spend,” said Metzger, 45, who works in law enforcement in Fargo, North Dakota.

Metzer’s eager pilgrimage is a familiar one to sports fans, especially after the easing of the COVID-19 pandemic. But persistently high inflation and gas prices loomed large over the monetary pipeline that resumed when fans returned.

US inflation rose 8.2% in September from a year earlier, the government reported this month. That’s not far from a four-decade high of 9.1% in June. Higher prices for housing, food and medical care were among the biggest contributors to the increase.

Given the industry’s reliance on disposable income, the inflation numbers are a troubling sign for game business leaders.

Ron Lee, a senior vice president at Navigate, said, “It’s historically accurate for teams that they try to take less on the ticket side because once one comes they usually make up for it.” ” Firm in sports and entertainment. “But after turnstile costs are going up significantly across the board, I think they have some decisions they need to make.”

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expensive ticket prices

According to a team marketing report, the average cost for a family of four to attend a 2022 Major League Baseball game was $256.41, an increase of $3.04 from the previous season. Behind the increase was the cost of main engine tickets, with the average general ticket price rising 3.6% to $35.93.

Despite the jump in prices, Americans have largely maintained their spending, especially on other services like entertainment and travel that they missed during the pandemic. Still, there are signs that concrete spending won’t last: credit card debt rising And savings have declined as consumers, especially those with low incomes, have hit their finances with increased inflation.

Casey Lynn, 43, a low-voltage technician from Minneapolis, and his wife, Lori, 44, a commercial lender, aren’t big football fans, but decided to check on the bears on a trip to Chicago. While Casey Lynn said she was upset by the ticket surcharge, the couple didn’t want to miss out on the opportunity to watch the game.

“Gas is a necessity. Electric is a necessity. Sport is not a necessity,” he said. “But when in Rome, why not?”

Dan Coyne, 38, a life insurance wholesaler from Harrisburg, Pennsylvania, makes an annual trip to Chicago to see the Bears with his brother, 47, of Valparaiso, Indiana, who have season tickets. But this time something was different.

“Flying out here is like tripling the price of rental cars, it’s definitely included,” he said. “But it’s only once a year.”

eating before the game

A few hours before the game, the brothers got something to eat. Dave Coyne usually shuns concessions at Soldier Field, but “I only had to pay for myself tonight,” he said. “I didn’t have any kids or my wife.”

Concessions typically result in higher profit margins for sports teams and providers, but increased costs of goods, transportation and labor have cut into those margins. The changes come after concessionaires were already hit by the pandemic.

“The whole model has been disrupted in a pretty big way because we’re dealing with inflation of 10, 15, 20, 25, 30%,” Delaware President Jamie Oblett said. Answer game service. “And you can imagine the impact it’s had on us and it’s forced us to think and do like many companies in the last six to 12 months.”

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Sodexo Live! Paul Pettus, vice president of the company, estimates that total costs have increased 10% to 15% over the past 12 to 24 months.

“Indeed, costs are rising across the board, but we certainly try to do as much as we can to keep it low and not impact the average fan or guest who comes to our events,” he said. .

The companies giving concessions are also facing pending issues with them. delivery method, which has improved recently but remains a factor. Oblett missed his company running out of Peanuts in the middle of the 2021 World Series in Atlanta, so two workers moved one truck to another, loaded and then drove through the night to drive back to Truist Park.

one less chicken finger

“Things are not very good,” said Oblet. “They are better than they were three to six months ago, it seems, and our hope is that that will continue to improve.”

The issues have forced concession companies to get creative in an effort to address rising costs with minimal impact on consumers in terms of culinary choices and price.

Chefs are redesigning menus to replace items that face significant cost increases and consolidating other options. They’re using analytics to check portion sizes – do consumers need six chicken fingers or will five work instead? – and take a closer look at their vendors.

“There are dozens of things like this that we’ve tried to do and are doing as we speak, trying very hard to offset those price increases that we’re seeing,” Oblet said.

Alison Birdwell, president and CEO of Aramark Sports + Entertainment, said the company’s analytics and its data science team are leaning “more than ever” when it comes to menu strategies and new concessions.

“With that guidance, we’re working to give fans the items they’re looking for, as well as be efficient with our product and avoid significant increases in costs,” Birdwell said in a statement to the AP. do less.”

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