Why food and drink at airports are so expensive: the hidden economy of terminals

The menu in the terminals is often more expensive than on the street: chocolate bar +120%, burger +46%. The reasons are the “street pricing plus” model, the high cost of working in a sterile area and weak competition.

Why is food and drink at airports so expensive?

Travelers are used to: everything is more expensive at the terminal. An analysis of the menu and field checks showed markups higher than street prices: a chocolate bar is 120% more expensive, a burger is 46% more expensive. The sources of the problem are systemic: limited competition, increased operating costs and pricing policies set by the airports themselves.

From “air mall” to “street pricing plus”

Since the mid-20th century, passenger terminals have become a source of income: restaurants, shops, services. After deregulation of the airline market in 1978, passenger traffic and waiting times increased, and in the 1980s, terminals began to emulate shopping centers. In the 1990s, Pittsburgh introduced a “street pricing” model—selling at the airport for the same price as in the city—and saw revenue growth without raising prices.

Later, the majority switched to “street pricing plus”: the base is the average city price, to which it is allowed to add 10–15%. This is how, for example, the Port Authority of New York and New Jersey (LaGuardia) works: “plus 15%” is considered a “reasonable addition” to the costs of the concessionaires. But compliance with the rules is inconsistent: media checks recorded products that were noticeably more expensive than the closest “street” analogues, without subsequent adjustments.

When “plus 10%” turns into “plus 69%”

In Minneapolis-Saint Paul (MSP), the official target is “street +10%.” Nevertheless, audits revealed: in one of the press outlets, prices were 69% higher than “street” prices, in a fast food chain – by more than 16%, for yogurt – by 84%. The administration announces semi-annual inspections, but is in no hurry to explain the gap.

The cost inside the “sterile zone” is actually higher

Operators and airports point to objective costs: inspections of personnel and supplies; construction and installation work in the terminal is 30–40% more expensive compared to the “street”; extended working hours; local wage requirements. Plus rent as a percentage of sales – usually 6–20% (usually 10–16%). All this pushes the final price up.

Few competitors, many brands – under one owner

Real competition is limited: the lion’s share of food outlets and retail is run by a few large international concessionaires. In the same terminal, different brands are often owned by the same parent company, and the consumer is locked into choice without a price war.

Market consolidation increases the bargaining power of operators: they seek higher or lower price ceilings. Thus, Phoenix abandoned “street pricing” in 2019, and in LAX price ceilings for most items disappeared by 2025.

More waiting means more spending

The increase in screening time after 2001 expanded the “dwell time”. According to industry statistics, about 63% of passengers make purchases after security screening. Nearly half of U.S. airport revenue is now non-aeronautical, and food and beverage revenue in 2024 was more than double 2010 levels.

Exceptions prove the rule

There are rare examples of strict “street pricing”. Portland (PDX) prohibits surcharges and yet has per-passenger spending above the national average. But a massive return to this model is unlikely: the infrastructure and contracts are tailored to “plus”.

What can the consumer do?

While regulators are arguing, the easiest way not to overpay is to buy water and snacks before security control (where permitted by transportation rules), or focus on points that publicly declare “no markup.”

Athens Airport: European prices at Middle Eastern rates

In Athens, even traditional logic “duty free = cheaper” has not worked for a long time. According to traveler reviews and personal observations, prices at Duty Free at Eleftherios Venizelos Airport are often 30–50% higherthan in city stores. And this despite the VAT exemption. The reason is simple: terminal rent is calculated as a percentage of turnover, and logistics and personnel passing through security areas increase costs.

Cafes and eateries show even more impressive numbers. Sandwich for €17 here is the usual norm, while a similar snack in the center of Athens costs no more €4-5 euros. Coffee, water and snacks in the “sterile area” also cost almost double/triple the price. This difference is explained by the classic airport mechanism: a passenger who has passed control can no longer go out and choose a cheaper one, which means he can be robbed in full.

Operator of Athens Duty Free, company Hellenic Duty Free (DUFRY/Autogrill)annually pays the airport up to 20% of revenuewhich turns the terminals into highly profitable rentals. For travelers, this means one thing: the closer to the gate, the higher the check. As a result, duty-free in Athens ceased to be a bargain shopping area and became an extension of the most expensive street in the city – only with a view of the runway.

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