Tampabay: Ballpark economics turn beer into profits

Suffice it to say, the team gets a piece of every cup. Typically, experts say, the company that runs the concession gives the team somewhere between 40 cents and 50 cents on every dollar.

The Devil Rays say they don't get nearly that much. They won't give a breakdown, other than to say that about $4-million of it has gone to nonprofit groups that help run some concession stands.

To fans who like baseball and beer, and not necessarily in that order, the markup doesn't seem to matter.

"Drinking beer," says Tim Flanagan, a St. Petersburg resident who attends a dozen games a year, "is what you do when you go to a ballgame."

Like most fans, Flanagan, who downs a couple of large beers at each game, is conditioned to ballpark prices.

"I know what a six-pack costs at the store," he said between sips at a recent spring training game.

Others are less restrained.

"It's ridiculous," said Mike Metzger of Gulfport. "I buy maybe one (beer a game), and nurse it."

The Devil Rays prices are not out of line with beer prices at the Ice Palace or Raymond James Stadium. The formula for turning beer into money at sporting events has been around longer than Don Zimmer.

It goes like this: Buy kegs in bulk and collect 10 times the cost of the keg. Or purchase bottles and sell them for several times the wholesale cost.

These days, a team's concessionaire can buy a keg for less than $50, then draw as many as 70 large beers worth more than $400.

It was no different in the days before charter flights and stratospheric player contracts, said Allen Sanderson, who teaches a course on sports economics at the University of Chicago.

"We're tempted to say it's expensive," Sanderson said, "but it costs less now than it did a generation ago" when you compare the overall Consumer Price Index and family incomes then and now.

What's changed the past 10 years is that teams get more of the action, said Chris Bigelow, a consultant to sports teams who has tipped a beer at just about every ballpark in the country.

"In many of the old ballparks, the city owned the ballpark so the team didn't always get a piece of the concession pie," he said. "They were a tenant. Teams have taken control and been much more aggressive in cultivating the revenue."

The markup on beer, Bigelow said, is no greater than the markup on any other item on the menu, although nothing else generates as many repeat sales.

Still, beer is a relatively minor revenue stream, said Kurt Hunzeker, the editor of Team Marketing Report, a newsletter based in Chicago.

"Not like tickets, or TV or radio" deals, he said.

Hunzeker said teams charge so much because they can. Once fans enter a ballpark or arena, "it's almost a monopoly" for the team, he said.

For fans, "it's a different mentality than the grocery store," he said, where those same people comparison-shop and refuse to pay a penny more than they think they should.

Prices won't come down, he said, until fans stop buying and sales drop, an unlikely scenario based on the fans at recent spring training games.

Drinking beer at a baseball game "is the American way," said Paul Spence, an employee of a civil engineering company in Tampa.

Like many fans, he senses the price of beer is helping in some small way to sustain a team in need of every dollar it can get.

Should first baseman Steve Cox, who is being paid $280,000, hit a home run tonight, fans can cheer along with team officials as the equivalent of almost 46,666 large beers rounds the bases.

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