Hidden reality behind 'horrendous' prices at Aussie airports revealed: 'Comes at a cost'

Yahoo

5 days ago

Travellers have long complained about the price of food, drink and other items at the airport. It's not uncommon to pay close to $20 for a beer or a simple bacon and egg sandwich while you're waiting for your flight.
A poll of more than 2,300 people found 63 per cent of travellers refuse to buy anything airside because it's a "rip off". It's a unique shopping and dining experience unlike the outside world, as you're essentially trapped once you've gone through security and customs.
You might automatically think it's because of corporate greed. But, consumer expert Gary Mortimer told Yahoo Finance it's much deeper than that.
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Reid Polak was recently shocked at how much it cost him for a quick and simple meal at an Aussie airport.
"I got a burrito and a flat white for $28, and it was terrible," he said.
"A 600ml water is $7.50. Just because you can charge more, doesn't mean you should."
The revelation sparked fury among other travellers, with many calling out Aussie airports for unfairly imposing higher prices.
"You're trapped there. It's horrendous," one person wrote.
"How is price gouging okay at the airport but not anywhere else?" added another.
Other travellers have similarly been forced to do a double-take when they found out how much simple items would cost.One woman said she was charged $35 at Perth Airport for two separate purchases:
$11 for a small coffee and bottle of water
$24 for two rice paper rolls and a packet of chips
If she had bought her meal outside the airport, she would've paid $5.45 for the first purchase, and about $16.05 for the second.
Meanwhile, another traveller shared their outrage at being charged $10 for a single slice of banana bread at Melbourne Airport.
Mortimer told Yahoo Finance it's easy to blame businesses for being greedy, but outlined the not-so-obvious costs businesses have to contend with to operate at an airport.
Airport workers cost much more to onboard
The QUT professor said staffing can be a huge cost to cafes, restaurants, and luxury designer brands inside an airport.
Airports operate from early morning until late night, seven days a week.
This means staff need to be rostered, including on weekends and public holidays.
Comparatively, a cafe on the outside might open at 6am and close at 3pm, while a restaurant might open at 5pm and close at midnight.
Airports can also be sent into disarray if there's a flight delay or cancellation. As a result, most airport businesses have to have enough staff on at all times to account for these instances.
But there is another major consideration.
"Imagine having a cafe inside a shopping centre. You can hire people all the time. They can park pretty easily to turn up at work. They can come and go as they please," Mortimer said.
"An airport situation, there's security clearances that need to take place for staff, which comes at a cost."
Airport workers have to have an Aviation Security Identification Card (ASIC) to get through the security checkpoints, as well as a national police check.
The ASIC card can cost upwards of $240, which is usually the responsibility of the employer.
The police check can cost $56, but if you need to give your fingerprints, that price jumps to $113.
"When we think about the services sector, there's a high turnover, which means you're constantly having to recruit people for your airport business," Mortimer said.
"They have to be security checked before they can go on to airside, which means, if they only last three months and then leave, there's more cost for you to actually put another person back on and go through that whole process again."
Sourcing supplies more difficult at an airport
The professor said this stringent security requirement for workers is also applied to all the goods that come into the airport each day.
They have to be thoroughly screened and the delivery driver also has to be ASIC-certified.
These extra steps can cause additional costs that have to be worn by the business.
But Mortimer explained that airports can often charge businesses to perform regular audits to ensure all their supplies are up to scratch.
"If you're a bistro and you sell meals, there are knives and forks and cutlery that can be used as weapons," he said.
"So you need to keep running a tally of those products. If you lose a knife in the kitchen, you need to be able to find it."
Not only that, but airports can also demand a percentage of revenue for the privilege of being in a highly sought-after commercial area.
The World Tourism Forum said this is what's called "percentage rent", which contributes to vendors jacking up their prices to account for this extra cost.
Simon Westaway, Australian Airports Association CEO, told Yahoo Finance that these "complex infrastructure and operations" that affect businesses often result in higher costs.
But he stressed that airports across the country have tried to "enhance the passenger experience" by offering a wider range of shopping, dining, and service options.