When it comes to world-class price gouging -- the kind that leaves customers in jaw-dropping disbelief -- it's just about impossible to outdo the corporations that sell food and beverages at stadiums and arenas across the country.
Locally, Aramark, an international company based in Philadelphia, is the firm that sets the absolutely outrageous prices for food and beverage at Heinz Field, Mellon Arena and PNC Park. But, by any name, these companies drag out the kind of pure profit from their customers that make the pharmaceutical giants and oil empires seem like the Salvation Army.
These people have no conscience. The pricing practices in this industry go beyond reprehensible. Markups of 500 percent are not uncommon.
They do this because they can. They charge $6 and $7 for a beer that costs them less than a dollar and $3 and $4 for a soft drink that cost them about a quarter because they have a captive audience.
What's a sporting event without a soft drink or a beer? The baseball anthem, "Take Me Out To The Ball Game," might cite "peanuts and Cracker Jack" as the lure, but that song is 100 years old and clearly outdated. The attraction today is beer. Guys who won't pay more than $14 for a 24-bottle case at their local distributor will spend close to that much or more on two cups of beer at a pro sporting event.
Food prices, though hardly economical, aren't as bad, but it's the beverages where the profit turns from absurdly high to beyond belief.
That's the way the free-market system operates, and it always has been our belief that, if people are willing to pay these exorbitant prices, well, more power to these latter-day robber barons.
But events of recent days have altered that thinking. Aramark has gone a step beyond and is guilty of excessive piling on.
Allegheny County last month enacted a 10 percent tax on alcoholic beverages. While restaurateurs and bar owners screamed the tax would ruin their business, Aramark said not a word. It knew it had its customers by the throat. So, it not only gladly added the 10 percent on top of its already extravagant prices but put as much as another 4 percent on top of that.
Here are examples how Aramark's latest profit stream works:
The price of a 12-ounce beer at Mellon Arena rose from $5.25 to $6, an increase of 14 percent. A 16-ounce can jumped from $6.25 to $7, an increase of 12 percent.
Mike McDonald, Aramark's Pittsburgh district manager, told Jonathan Silver of the Post-Gazette why the products went up more than 10 percent.
"In our industry we round to the nearest quarter for the speed of service. We don't deal with nickels or pennies or dimes."
The reason they do this, according to McDonald, is as a favor to the customer. "With the short service window we have at these venues it would just lengthen the time to bring customers through and create more of a problem."
Isn't that thoughtful.
You can't get much more customer-friendly than that. Why don't other retailers do the same? Why can't Giant Eagle, Shop & Save and Foodland be as considerate as Aramark? The nerve of those food retailers asking their customers to wait in line a bit longer so small change can be delivered to them. The gall of these supermarkets to expect people to bother with nickels and pennies.
There is no relief in sight from this. Most certainly, the teams -- Steelers, Penguins and Pirates -- who pride themselves on being fan-friendly won't ask Aramark to reconsider. They're full-fledged partners in this disgrace.
The exact percentage of gross the teams get from Aramark isn't known, but it can be upward of 30 percent and as much as 50 percent.
Just recently, the Penguins cut a 10-year deal with Aramark to handle the concessions at the new arena -- the one being built largely by taxpayers' money. No word on what kind of deal was made, but the Penguins either got a large chunk of cash -- millions -- up front or a high-end percentage of the gross revenue.
That's sweet for the Penguins, as the deals of the Steelers and Pirates are for them, but sweeter still for Aramark. After all, the Penguins have basically given Aramark a 10-year license to print money.
These kinds of deals give new meaning to the phrase "taxpayer-funded."
The taxpayers are paying twice: Once with their taxes and again by being asked to pay grossly inflated prices at the arena and stadium concession stands.
On its Web site, Aramark boasts that it "has consistently ranked since 1998 as one of the top three most admired companies in its industry as evaluated by peers and industry analysts."
This is known as honor among thieves.