Only The Government Could Lose Money Selling Booze To Football Fans

From the “you can’t make this stuff up” department:

The University of Minnesota lost almost $16,000 last year on alcohol sales at home football games, despite selling more than $900,000 worth of beer and wine.

The school released the figures to the Associated Press after a records request, which showed it incurred significant expenses from its first season selling alcohol stadium-wide at TCF Bank Stadium. Those include hiring additional police and security officers, setting up tents and other facilities, and equipment rental. Roughly half of its revenues went directly to Philadelphia-based Aramark Corp., which had the contract to sell beer and wine.

The booze itself cost the university about $180,000.

Associate Athletic Director Tom McGinnis said the university never expected to turn a profit from alcohol sales. The Legislature passed a bill last April allowing the school to sell beer and wine so long as it was available to the general public.

“We wanted to make sure that it was a positive experience for our fans,” McGinnis said.

Whether or not the intent was profit, long-time SAB commenter Bike Bubba does the math and concludes that they could have turned a profit if they weren’t running it like a typical government operation. Which is to say that the overpaid for everything, up to and including labor:

At $7.25 per 16 ounce glass of beer, they sold about 125,000 glasses of liquor. Revenue is $900k, cost of the liquor was $180k, about $450k went to the vendor, $30k for ATMs and plants, and $47k for security.

OK, so the other costs–setting up tents and labor–appear to be about $205k in all for them to lose money. What went wrong here?

Well, their wholesale price per drink (about $1.40 or so) is higher than the retail price of the beers they serve, their labor cost equates (even with generous wages of $20/hour) to each worker serving a drink every five minutes, and Aramark is getting an incredible amount of money for setting up a few beer tents.

This is just how things go when bureaucrats spend other people’s money.

Rob Port is the editor of SayAnythingBlog.com, a columnist for the Forum News Service, and host of the Plain Talk Podcast which you can subscribe to by clicking here.

Related posts

Top