• Home
  • Global News
  • Why Does A Bottle Of Water Cost You More At The Airport?
Why Does A Bottle Of Water Cost You More At The Airport?

According to rules, one cannot price identical items differently. But at the airport, we have a bottle of water which costs us much more than a local store. Ever wondered why is there a variation in Maximum Retail Price (MRP) on the same product at different places? On the same line of thought – Is it possible for companies to charge differently for the same product, sold through different trade and retail channels?


The Amendments Say, No!
According to the Rules 2011 of the amendments that were introduced to Legal Metrology (Packaged Commodities), which was effective from January 1, 2018, it is mandatory that a company cannot apply dual MRP to identical pre-packaged commodities.
The MRP may vary due to the quality, quality, packaging and other product differentiation. The companies price these commodities at different MRPs and sell different packs across different retail and trade channels, which in turn brings cost variations.
As well as, these companies have different sizes of stock-keeping units for different trade and retail channels, and they are allowed to charge different MRPs according to the size.
Steps taken by the AAI
The Airport Authority of India (AAI), has asked the concessionaires at the airports to sell the products at MRP and not above that. They also had informal meetings in the past where it was asked by the AAI that the concessionaires charge suitably for food and beverages, to make them affordable, especially in smaller cities.
The Other Factors
1. Many must be unaware of the fact that the hotels and restaurants can legally sell bottled water and other packaged products above MRP because they render services, which cannot be governed by the Legal Metrology Act.
2. The location also has a huge role to play in the variation of cost. The airport concessionaires have to pay real estate cost, which are 5-6 times higher than other retail locations, which makes it capital-intensive.
3. Multiple changes to the GST structure in the last one and a half years is another factor which affects the MRP and labeling a tricky issue for packaged food companies.
Whatever the reason might be we appreciate teh actions by the AAI to control the prices and stand by it. Let’s hope in future, we can afford the whole dinner at the airport.



More in Global
Russia: A house on the banks of Volga River, designed on the principle...

Natalya Bespalova envisioned a small dwelling that envelopes inside it peace, well-being and happiness

Recently posted . 13 views

Saudi, World's Top Oil Producer, Launches City With No Cars

The project has been plagued by skepticism and political controversy since its launch. Analysts question if it's realistic and can attract the investment need...

Recently posted . 13 views

‘Black Spartacus’: A biography of the man who may have been the first ...

Sudhir Hazareesingh’s book examines the life of Toussaint L’Ouverture, who brought revolution to Haiti and inspired the world.

Recently posted . 13 views

4 behaviors that transform ordinary people into CEOs, according to a s...

If you think all CEOs are Ivy League educated individuals who set their eyes on the C-suite at a young age, you’re mistaken. According to Elena Botelho and Ki...

Recently posted . 29 views



Thought of the day

✍ छोटी सी उंगली पर पूरा “गोवर्धन पर्वत” उठाने वाले श्री कृष्ण... ”बाँसुरी” को दोनों हाथों से पकड़ते है.. बस इतना ही अंतर है ”पराक्रम” और “प्रेम” में..! आपसी संबंधों में “पराक्रम” नहीं “प्रेम” दिखाइये। 🙏