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TOPIC: Drive In Start Up Costs

Drive In Start Up Costs 05 Sep 2006 14:44 #13270

  • chrisb74
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Hi,
I am trying to research the costs involved in starting a drive in theatre. From what I have read and seen on TV, Drive In's are on the rise once again. Obviously the land is a major cost, but what about some of the fixed and variable costs that I should consider. How many years does it take to break even?
Thanks
Chris-
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Re: Drive In Start Up Costs 06 Sep 2006 00:39 #13271

  • Ken Layton
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Some of the things I can think of:

Is the site connected to city water/sewer or is it well/septic?

Is 3 phase electric power available at the site for the lamphouse rectifiers?

Is the screen tower made of wood/telephone poles or is it all steel? Steel lasts longer and is less likely to suffer wind/storm damage.

Are there other things to do at the theater that would help draw people in like go karts/miniature golf/playground equipment?

Will owner/operator live on-site?

What are current zoning regulations? Some areas prohibit new drive-ins while at the same time grandfathering existing ones.

Any room for expanding the number of screens in the future? The more the screens the better.

Is there a large area inside the snack bar for indoor seating/tables? That would help extend your operating season by having a nice heated/cooled indoor area to sit, eat, and watch the movie from a comfortable environment should the weather be a problem.
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Re: Drive In Start Up Costs 07 Sep 2006 13:17 #13272

  • rodeojack
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Something you see a lot in these discussion boards is people who look at the theatre business and say "I want to do that". That's great... you have to start somewhere, but there's no book, class or film that can show you how it's done. This is really a good example of a business that's learned by working in it. 80% of what you need to know you can learn by getting a job at a drive-in, then paying attention to what's going on around you.

Important things to know include how a community drives a theatre's bookings and activities. Community values make a big difference for drive-ins. The films the residents of one town will patronize may not work in another. It's one reason why you probably can't find two drive-ins in this country that look or feel the same.

Community activities, as well as local weather will have an effect on your season. School football and social activities, community events, fairs, parades, etc. will pull from your audience, depending on how popular those events are.

Once you learn how a drive-in ticks; how films are booked, how concessions fit into the business model, what skills you need to manage the crowd you expect to draw, how to gear up to do 12 hours of business in 4 or 5... then the rest is pretty much common-sense business... mortgage, insurance, taxes, repair & maintenance, staffing, percentage and concession product payments... and hopefully, a check for you!

I personally have avoided using gimmicks to bring people in. I don't have a carnival, go-karts or putt-putt golf, though I do have a very informal swap meet on Sundays. I've always wanted people to look at the drive-in as an outdoor movie-going experience with great food, rather than cluttering the concept up with a lot of ancillary activities. That model works for me, though it needs to be said that adding extras has kept a number of drive-ins open... and some owners would support the idea as a way to put extra money in your pocket. That's probably a decision with no wrong answer, but one you'd have to make for your individual location.

Ken makes a good point. Your operating costs can vary widely, depending partially on what you bring to the table. A drive-in is a great example of a "hands-on" business. Are you going to manage the place or hire it out? Will you live on the property, or will you be making payments on your business AND your residence? Wife? Will she work there, too? When things get busy, will you get behind the counter and make a pizza, or will you consider your managerial position above that, and hire enough staff to cover the largest crowd (believe it or not, some owners do exactly that!). Will your booth be reliable enough that it can run with moderate attention, or will someone need to be there when the films are on? Will that person be you? Can you install/maintain your equipment, or will you have to have service technicians come in to keep things working? Will you mow your own lawn or hire staff or a landscaper to do it for you? Who's picking up the field & cleaning up the snack bar at the end of the night?

Many of these are variables that can't be answered in a discussion board. You need to get some experience in the business, so you can come up with reasonable estimates... then you can fine tune the details as you go along.

Good luck!
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