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TOPIC: Independent Theater Startup

Independent Theater Startup 27 May 2012 01:04 #38542

  • Josh42390
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I have a few questions for starting up an independent first run movie theater. I have been interested recently in the idea of starting up my own movie theater. I am an avid film fan, and enjoy the thought of running my own business. I realize that discount theaters are pretty much done with things like red box, netflix, and on demand ppv so first run theaters seem to be the way to go. Let me give some of the details of the area that i'm in

1) The city i am thinking of has a population of around 5,000. It is very rural and is about 30 minutes away from another slightly larger city. There are three theaters around this small city, but two are about 40 minutes away, and the third is about an hour.

2) This city is extremely rural, with several smaller buroughs and villages within 5-10 minutes. There is almost no entertainment within the city, short of bars and a walmart.

3) There is a small campus of the University of Pittsburgh in the city with a few thousand students every year so that adds to the demographics.

I see huge opportunities for a small independently owned theater in the city. With a population of 5,000 and a university campus with a few thousand additional possible customers, it seems like the perfect spot. The added interest in this area is the lack of entertainment without at least a 40 minute drive in any direction. I figure with the cost of gas, it would be an added lure to the citizens of the town attending a theater right at home.

My main concern is the cost of either building a completely dedicated building or renovating an existing building, plus the cost of equipment (projectors, food equipment, etc). The profitability also concerns me. I am young and most likely would never be able to get financing through a bank. I would have to look into independent financing through local businessmen. Any information would be appreciated as far as whether it is even worth thinking about, or whether I should just put it away in my mind as a dream.
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Re: Independent Theater Startup 27 May 2012 15:46 #38543

  • slapintheface
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Sorry to say there is no way to make money in your lifetime on this investment . Population is way to low and way to rural .
The only small glimmer of hope would be to find an old theater that is closed and reopen it .
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Re: Independent Theater Startup 27 May 2012 19:19 #38544

  • jacker5
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Try to find a one screener that has between 300-400 seats and convert that into a dinner theatre. Your best bet!
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Re: Independent Theater Startup 27 May 2012 22:05 #38545

  • Mike
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gee whiz... who knows what works? I would not be so quick to "slap" it down. :) I do know that 2000 kids is a huge deal as a friend of mine can attest: college kids will go to movies like almost no other demographic. It really depends on the town and what's available: is there a landlord you could partner with? Is there an aggressive econ development office in town? Lastly there's more of these little dvd/ blue ray theatres popping up. I wouldn't so never just yet.
Michael Hurley
Impresario
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Re: Independent Theater Startup 27 May 2012 22:14 #38546

  • revrobor
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I agree with Mike. It appears your largest audience will be college students. But there may be other demographics that are not being served by the other theatres. It also depends in large part om how you program your theatre. Good luck. And feel free to ask questions.
Bob Allen
The Old Showman
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Re: Independent Theater Startup 29 May 2012 01:00 #38547

  • Josh42390
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Thanks a lot for the info. I know that it would be a risky investment and am just in the idea phase right now. It's good to see that there are those that understand the college demographic like I do. When I was in college one of the best pieces of entertainment was movies.

The main issue that I would have is the financing. I don't think I would have an issue as far as finding a piece of property. I'm not thinking anything huge like an imax. I was thinking of something along the lines of a small 4 screener. I know of a couple of wealthier businessmen in town but am not sure if they would be willing to finance something this "risky" not only because of the amount of money it would take, but also because of my lack of experience in this field. I have years of customer service experience but nothing on this scale. But I am the type of person that can research something and feel comfortable jumping into it.

Thanks again for all of the information.
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Re: Independent Theater Startup 29 May 2012 01:03 #38548

  • Josh42390
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To "slapintheface":

The city used to have a theater but it became too run down to renovate. Sadly it made way for a Burger King. So that idea would be off the table.
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Re: Independent Theater Startup 29 May 2012 20:17 #38551

  • rufusjack
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Josh,

This is an expensive business to be in now. Starting from scratch you will need probably $70-100k per screen just in equipment for each auditorium including sets. Not included is any build out if you are lucky enough to find an existing space that will work.

Banks do not like to invest in an unproven business idea. Wealthy people in general are risk averse.

You have many hurdles in front of you. Your odds of success are very small in today's environment IMHO.
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Re: Independent Theater Startup 30 May 2012 22:08 #38552

  • JPRM
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I'm brand spankin' new to this biz, so I know nothing. However, I'm a big believer in following dreams such as this.

Off the bat, I'd say that finding an existing space that you can convert is how you keep this particular dream alive. Find the right type of space and you won't need a big remodel. Here's a look at a hugely popular one-screen joint that's just a mile or two from where I live:

www.flickr.com/photos/juneny/5178051977/...et-72157625270835309

This place is a converted school gym, complete with a flat floor, loveseats and sofas for seating, etc. But they do it right, and people love it. Please note, these folks did no remodel at all. They just weren't held back by anyone's idea of what type room can or cannot become a theatre. Find a place zoned for what you need and you can rule the world.

One thing to keep in mind - you'll hear from people every day who tell you this can't be done. It's too expensive, there's not enough population, etc. But the experts will be all over the map on this stuff. Some will tell you it's a great idea while others will tell you it's impossible. Again, I know nothing and I may be on the brink of failure, but I'm about 3 weeks away from opening, and it's one of the best things I've ever done. Yes, I'm going digital, no it didn't break me and no I'm not using a VPF. If it's something you dream of doing, you give it a cold, hard look and you find a way to make it happen.
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Re: Independent Theater Startup 31 May 2012 03:58 #38554

  • slapintheface
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JPRM-- I am sure you are A nice guy--- but advice like this is what makes people loose there fortune...... There are dreams that are worth the risk A 4 screen with digital $75,000 per screen plus +++++ reNovation/building -seats -lobby-equipment ---- in 5000 + population is how people go BANKRUPT !
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Re: Independent Theater Startup 31 May 2012 06:25 #38556

  • JPRM
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Slap, I thank you for the kind words, but I'm actually not a very nice guy. I also may give ill-advised encouragement on occasion. However, nowhere have I ever recommended that someone open a 4-plex under these circumstances. On the contrary, I point to a one-screen theater as a rough model.

Also, you'll never see me encourage anyone to follow some really poorly thought-out dream ("I want to build a theater from the ground up, show only public domain movies and encourage people to bring their own refreshments!")

I shared my thoughts, and I'll stand by 'em. Creating a one-screen theater in an existing space just doesn't seem all that ridiculous to me, and I do encourage a 'cold, hard look' before moving on anything. This dream business ain't all unicorns and rainbows, after all.
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