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TOPIC: How many screens?

How many screens? 17 Nov 2008 01:17 #30362

  • debo
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Slap has stated his preference for planning 2 screens per 10,000 population several times on the forum, and I see 1 screen per 10,000 just about everywhere else (usually quoted as "the old industry rule of thumb").

The area I'm looking at has 18,000 people within 10 miles (including a college student population of ~5000) and an additional 20,000 within a 30-minute drive (mostly by interstate) for a total of ~38,000. We lose most of the college students in the summer, but we're a few miles from a lake that draws large summer crowds. The closest competition is 45 minutes (a second-run 4-plex and a mixed first- and second-run 7-plex, both in poor condition, but the community has other draws including alcohol and some shopping). The college students typically opt to travel farther to a large metropolitan area 1 hour away where there are several newer megaplexes. I've only included the within-10-miles population in the area between our town and the 45-min and 1 hr options, and the 20,000 within 30 minutes in the other direction have to drive at least an hour to find a screen.

I'm thinking a compromise between the two rules might be okay for a total of six screens (about 850 seats?), but I'd like to get some feedback on that. I'd also like to hear any comments/suggestions on estimating annual admissions with this population. Based on the NATO information, the average ticket price was $6.88 in 2007 with 1.4 billion sold--gives about $32.10 per person or about 4.7 times per year per person. Per capita income in the area is about 2/3 the national number, and I've been using that to scale the per-person national expenditure on movies. That projects $800K a year in ticket sales, but that assumes all the people in the area come to this theater for all of their annual viewing. Any suggestions on estimating what fraction of that I might capture for a first-run theater given the market described?

And any suggestions or rules of thumbs for projecting or finding data on per cap concessions? I've seen a range of per caps reported on the boards, but the anecdotal average looks to be around $3. And am I correct in thinking that I add this to the projected revenue from admissions? If I do the same scaling based on per capita income in the area, concessions at a per cap of $3 would add another $350K in revenue for a total of $1.15 million in tickets and concessions. I'd appreciate any rough idea you can provide on gross annual revenue given this scenario to see if I'm anywhere close in my estimates. All of that seems too high (would require daily average of 323 ticket sales or about 54 per screen per day). Then again, the college students spend more than twice as much on tickets annually, and their unemployed presence in the community also artificially depresses the reported per capita income of the area.

Awaiting your collective wisdom!
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Re:How many screens? 18 Nov 2008 00:13 #30367

  • slapintheface
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The industry standard has been for decades 1 screen per 10,000 people.My thoughts are how can that still be the same.The rule of thumb is based on auditorium sizes lets say (modest)400 to 600 seats.Todays theaters average 150-200 seats per auditorium.So my model is always based on 2 screens per 10,000.Also 2 choices in movies will will bring the same 10,000 out to the movies a few more times a year.There may people that may disagree just the way i work the numbers.
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Re:How many screens? 18 Nov 2008 00:20 #30368

  • slapintheface
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Your average theater ticket margin is 48% of the gross per year .So if your ticket is $7.00 the theater makes on a yearly average $3.36 per ticket.Concession if you sell a $3.00 item your average profit sould be around $2.30
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Re:How many screens? 01 Dec 2009 11:53 #32906

  • JonnyD
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How do you project the projected ticket sales?
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Re:How many screens? 01 Dec 2009 22:31 #32910

  • rufusjack
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First I applaud you for doing some number crunching already.

I am okay with 2 screens per 10,000. You cost after initial up-front costs are minimal to have more screens. On-going costs increase mostly when more people show up. So if your analysis says 5 screens, having 6 would be okay. so the cost to run 1-6plex is much less than 3-twins. The old adage of 1 per 10,000 first came when theatres had fewer screens.

IMHO if you do 6 screens, you need 2 rooms that are approx. 250 seats, 2 more that are 150, and 2 that are 80-100. Keep your screen size as big as possible so go keep the same width of the rooms, but reduce the depth.

As far as projections, maybe go with 50% market share. At what point do you think you will break even?

I do not know of many people who wish they had fewer screens.
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