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Airport Observation Report

940 Words4 Pages

The objective of doing this report is to learn more about why food in the airport is more expensive compared to hawker stalls and restaurants as we can see the examples from numerous airports in our country. Airport is a place where aircraft are operated as a mode of transportation for both domestic and international uses. It usually has paved runways and maintenance facilities besides serving as terminals for departure as well as arrivals. This means that a person travelling abroad will have to go to the airport to depart for his or her intended destination. Food has a relatively inelastic demand. Its mean that as the price changes, the demand does not change much. On the other hand, we can observe that the food so expensive at the airport. For example, there are people who will buy some food to eat at the airport whilst waiting or latecomers who do not have time to spare for consuming homecooked meals so they …show more content…

The reason why is they charge and hike up the price of the rent is to gain more profit. Since operating the airport cause a lot of expenses and in order to gain back the money they have to do it. The cost of managing the whole airport is not cheap therefore the profit from renting the retail space can help to recover the loss they might get. The airport authorities also know the company that want to operating the retail there willing to spend that amount they introduce. Due to they expected the people from outside will get hungry after that journey and willing to spend for the food. The owner of the retail space decide to take the opportunity knowing the passengers will arrive early and sometime will purchase the food while waiting for the flight. The retail owner need to pay for the high rental thus making the price of product or services they selling increase also. This is why the food in that have been sell by the retail is

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