Based on build costs, the population of 40,000 will not pencil out for 6 screens.
In research of large number of multiple screens, two years ago, it was determined that most theaters are 30% overscreened relative to film grosses and playtimes.
In reviewing the playtime required to maximize boxoffice gross in 2005, I discovered by reviewing ALL films released nationally that 92% of national gross is obtained in 5.5 weeks.
Two years ago that number went down to 4.5 weeks.
This year it is 3.5 weeks.
In analying the average drop per week per film nationally, I reviewed the release patterns of pictures and averag playtime for small towns. I had purhased a building with the possibility of adding a sixth screen.
After looking at all these statistics and release patterns of films for previous 5 years, it was determined that the maximum number of screens needed to economic playtime the screen average was 5.3. I certainly did not need to spend $350,000 to obtain .3 screen.
When I returned to the industry after years of being away, I too needed to look at today's market and what worked. I spoke with many people and no one knew 'why' 8 screens was the current model. They just built them. One film booker, who never paid a mortgage payment in their life said the right number was 8. Why? I said. The film booker said, 'well, you need ot have a screen for evryone's picture'...
The number of screens rule of thumb usd to be 10,000 population per screen. Some say that number is closer to 8,000 now. I am not so sure that 10,000 is still a good rule of thumb.
However, movie going is about behavior batterns and frequency of attendance.
If a person were to buy an existing theater and the price was right, maybe a different story. But from a build basis, I would build a 4 screen with ability to expand to 6 cost effectively. If the two additional screens were very small and inexpensive to build maybe so.
Botomline it is about build cost of those two additional screens.
There are so many factors in these decisions, especially in small towns, that I would encourage a person to get ALL the information they can, study it, then make a choice. IT IS A LONG TERM DECISION, that should be made by research from authorities who know, not people who just have an opinion.
There are movie going frequency patterns that differ with age, education, economics, etc. And especially today with the movie experience changing with different technology. Patterns are changing. Teenagers for example, cannot be counted on as before with their patterns. A number of theater owners I know who have been in industry for many years are noticing these subtle differences as well.
Today...I would be very careful in making an economic decision that would last for 15 years based on just opinions.
Before I bought a theater last year, I researched every picture that had been played for the past five years by week as compared to other comparable population towns. I found that the demographics here DID NOT fit national numbers. The population base was heavily loaded in over 40. However, as I looked futher into the incomes of the area, I found that they attended more frequently than that same demographic group in other areas.
In that research I found by playing pictures to that demographic and avoiding those to teenager demographic and going total digital, my revenue is 20% higher than previous owner.
My suggestion is to do your own research for your own community, your own build costs and movie patterns of YOUR market. They are all different and the difference could be a make or break choice. Once you have a payment, it does not change.
While I respect the experience of those who contribute here, I must ultimately reply on my own ability to resarch to make a choice. Suggest others do the same.
If you wish to hire a consultant to assist you in areas that you do not know, that would be a good idea. If I had not had 20 years experience before I returned to the industry after being away for awhile, I would have been happy to pay someone to do the research for me.
Banks are not consultants, they are bankers. Theater operators sometimes are just that 'theater operators'. Some do not have financial consulting and planning experience. Some do not have responsibility of film buying or profit and loss statements. Just suggest people be careful when making a financial decision and I would not 'throw just any opinion' out as a person could rely on that and I would not want that.
Theater ownership is about real estate and return on investment. Movies is just what we sell. Ultimately it has to be a sound business choice and investment. Each person must make that decision on their own. Their life and life savings may be at stake.