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TOPIC: question about pricing for movie equipment

question about pricing for movie equipment 21 Apr 2010 00:33 #33799

  • lld36
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hey everyone i am new to BSB this is my first message. i have been looking into starting a theatre and i have gotten ideas about some of the cost but i was wondering if anyone could give me an idea about how much it would cost to equip a theatre with 4 or 5 digital projectors and also for the sound systems and screens. a little info there are about 50000 people in the area and no theatres so i will be starting from scratch with no real competition. also about how much would it cost for food monthly or so because i can not find anywhere to make a guess at the amount i would need to keep the theatre stocked or how much it will cost. all help is greatly appreciated.
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Re:question about pricing for movie equipment 21 Apr 2010 02:43 #33800

  • revrobor
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Welcome. Digital equipment is still very expensive at this time going for about $100,000 per projector. You can equip a booth for film at about $15,000 with used/reconditioned equipment. Film will still be around for many years. The best thing for you to do is contact a theatre equipment dealer in your area. At the top of this screen click on DIRECTORY and scroll down to the equipment suppliers section. You can also tell us where you are located and perhaps we can help you further.
Bob Allen
The Old Showman
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Re:question about pricing for movie equipment 30 Apr 2010 04:58 #33871

  • lld36
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i'm located in the south Mississippi actually. I am now trying to figure out how many people I can expect to have come to my movie theater a week. I have found information that says the average times a person goes to the movies a year is 5 times is this right? if so then with 50000 people in the area it would be 4800 people a week that seems like a lot to me. anyone know if this information is right or know somewhere I can find the correct information if it is wrong?
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Re:question about pricing for movie equipment 30 Apr 2010 06:57 #33872

  • lionheart
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Five times a year is roughly the average nationwide. As for how that translates to the actual number of customers you will have per week, you need to consider what your actual market share will be, and just how close to "average" the people in your area are.

Some places in America will have attendance higher than average... perhaps a big college town, or maybe a dense upscale urban area. Other places will have less than average attendance. Some factors are the availability and popularity of other forms of entertainment, as well as the disposable income of those in the area (Read that as how rich or poor they are). There are statistical reports out there to help you figure out how much people spend on entertainment. You would have to buy the report. I bought one once for about $100, only to see that it appeared that the area was indeed about average in that area. I cannot remember the company that sells these.

Instead of going off the reports or the national average, it might be better to make your calculations considering best, moderate, and worst case scenarios. Think of best as meeting the national average, moderate at maybe half that, and worst as maybe once per year for an average customer living within the immediate vicinity (not counting outlying areas). After all, it is not necessarily as simple as "build it, and they will come."

Also, you say there is no competition in an area with population of 50,000. That is rare. You need to consider that people are probably going somewhere to see movies, even if they have to drive a fair distance. They are your competition. If they are bigger, better, or newer than you, then they are important competition, even if they are 20, 30, 40 miles away. If your theater is bad enough or does not have the right films or 3-D films, etc., they might drive even farther for a different experience. Also, is there good dining available in your area, or is it in their area? You have to think about these things.

If you are really the only theater for 50,000 people, then you probably want about 10 screens, and then you are probably looking at millions to build and equip the place. If you build too small, you may have big brother moving in and building over you.

It certainly gives you a lot to think about.
Last Edit: 30 Apr 2010 07:02 by lionheart.
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Re:question about pricing for movie equipment 30 Apr 2010 10:26 #33873

  • leeler
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well said, lionheart. newbies take note of the post above! sage advice
"What a crazy business"
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Re:question about pricing for movie equipment 30 Apr 2010 12:24 #33876

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I would be shocked that their is a market of 50,000 w/o a decent theater. Look at the recent single screen threads with slap's theater as a good example of knowing the area well. $3-4 million at least for a new 8-10 screens theater.
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Re:question about pricing for movie equipment 30 Apr 2010 22:20 #33877

  • BWT
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I concur -- great post, lionheart; definitely a nice succinct account of what to think about before assessing an area for a possible newbuild.
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Re:question about pricing for movie equipment 01 May 2010 01:08 #33878

  • lld36
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lionheart the best moderate and worst case scenario is good thanks. I moved here for a new job and was very surprised by the fact that there is nothing to do the nearest 3D is 2 hours away and the closest movie theatre is 50 minutes away and it is not very nice doesnt get new releases till they are a few weeks old. The next closest is and hour and a half with a small mall. There is a small college here and several nice places to eat but for entertainment there is just a bowling alley and a few bars or clubs we also have a nice down town with cute boutique shipping. There used to be 3 theatres in town one was a drive in that sold the land for wal mart to build on. One was a mom and pop with just 2 screens that when they retired they sold to arbys and the last was the original theatre in the down town area that the city now owns and uses for community theatre projects. I started looking into this since I had realized there was nothing for me to do here and now have started to get a serious the more information I collect about it. I saw a page that said you needed about one screen for every 10000 people you expect to bring in. So I was thinking about 4 or 5 I had not even thought about 8 to 10 that seems like a little to much and I had figured under 2 million for building and all since there is not one here to renovate.
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Re:question about pricing for movie equipment 01 May 2010 10:27 #33879

  • rufusjack
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lld36,

The amount of screens an area can support has been discussed frequently. You should read every (and I mean every post).

Long story short: years ago, decades ago - 1 screen per 10,000 people seem to be the rule. But that was a time when you had theaters no bigger than 4 screens with many being singles and twins. So you had multiple theaters with multiple staffs and multiple lobbies, bathrooms, etc. 1-8plex can be run significantly cheaper than 4 twins.

1 per 5,000 people is a good start. Almost all of us wishes we had more screens than we currently do. I certainly do. I have ssen many 8-plexes in 15-20,000 population markets (again read every post).
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Re:question about pricing for movie equipment 03 May 2010 10:13 #33882

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If your area had 3 theaters that have all closed with no replacement, it makes me wonder why. I understand that the drive-in was probably worth more to the owners as a building site for Wal-Mart. Maybe that was true for the twin that went to Arby's as well, but it's more likely that it was up for sale before Arby's was looking, rather than having them come in cold off the street and making an offer. So maybe it wasn't doing well. Why? Was it run down? Did it have poor film selection? You need to find out.

That leaves the downtown theater which now is only used for community theater. Maybe it did poorly because the twin opened? Again you need to figure out why nobody is currently using it as a film venue.

If business was bad at all of them, you need to examine the population. Odds are that with 50,000 people, there is an unmet demand for a cinema, but you need to determine if all 50,000 are potential movie-goers or if it is somewhat less. For example, some religious denominations do not attend movies.

You could build something less than 10 screens based on your analysis, or based on your budget. Leave yourself room for expansion in case business is booming. If it does boom, you can be sure that your numbers will attract attention from larger competitors, so you might need to act quickly to expand.

I know that when I was searching for a location to start a new cinema, I identified three different towns that looked good, only to learn that an established chain was already planning a new theater for that area. So, be sure to contact the city manager's office, the chamber of commerce, and/or the economic development commission and ask them if anything is in the works. The towns I looked at had populations around 20,000. Each time I was told they were getting new 8 screen theaters, while I was only considering putting 2 to 4 screens there.

Probably a lot of those rooms in an 8 or 10 screen theater don't see many customers, but it's what it takes to be competitive. You can build several of them to be much smaller, with one or two big rooms, and maybe a few medium sized ones. You can hold down the equipment cost for now by using film in several of the rooms, and only equip a few with digital and 3-D.

When making plans, be sure to include the cost of things like parking lots, fire sprinkler systems, and bringing in larger water mains for those sprinklers. There may be a lot of unforeseen costs involved. It's hard to make good construction estimates unless you specialize in this kind of construction, so whenever you make what you think is a good estimate, double it and you might be about right.
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