Mainstream, first-run theaters: These typically show major films at their time of release. They are often corporate or franchise operations, but not always. These usually show a number of different films at one time in individual theaters housed within the building. Second-run theaters: These specialize in films that have already been shown in first-run theaters. Independent theaters: These may show independent films, specialized features, classics, major-release films, or some combination of these. These are more likely to have only one or a few screens. These may also be theaters that open up in a bar or restaurant. Drive-in movie theaters: These are open, outdoor areas which show films on large screens to viewers who park and watch from their vehicles. They need special projection and sound equipment, and ramps for cars to park on. Drive-ins can often only be used in warm months of the year. They can be repurposed during other times, for as flea market spaces, etc. [2] X Research source You can also set up a very simple theater that might be a homemade screen set up in someone’s yard, or a consumer-grade projection system set up indoors. This could be sufficient for your needs if you are just interested in showing films to fairly small groups of people, such as for non-profit community events.
Talk with the other theater owners to see how well their businesses thrive. Just because you’ll be a competitor doesn’t mean that you can’t have a friendly professional relationship. Conduct a survey of the local community to determine what kinds of films people watch. You’ll want to make sure you’re playing movies that people will actually watch. If you live in a really conservative area, for example, you probably won’t have a lot of success showing really racy, edgy films.
Having the brand and name recognition of a major chain, which will draw moviegoers who are looking for a standard experience. Ease of setup—the franchise terms will probably determine many decisions that have to be made in opening the theater. The financial backing and resources of the chain, including contacts to film brokers. On the other hand, you may not have as much control over the details of your theater if you have a franchise. Some major chains do not offer franchise opportunities. [4] X Research source [5] X Research source
You can also start a nonprofit movie theater. For this type of operation, you’ll need a mission statement, bylaws, and a board of directors.
Building rental or purchase Staff Concessions overhead Licensing fees for showing films. These can be very expensive, especially for first-run, major motion pictures. Movie brokers can be hired to assist with the process of attaining films and approval to show them. Equipment. This can include projection systems, lighting, seating, soundproofing, decoration, concession areas, etc. The particular equipment you need depends on the type of theater you want to operate. Most movie theaters need to have digital projection capabilities, since movie distributors primarily distribute their movies on digital formats now. The upfront costs for digital projection can be expensive, with a digital projection system for one screen running $60,000 or more. If you have multiple screens in your theater, your costs will be much more expensive. [7] X Research source You might also consider offering certain specializations, such as 3D capabilities, D-Box motion seats, or IMAX (large-format, high resolution screenings).
Think about parking as well. If your customers have trouble finding parking spots, they may be less likely to come to your theater.
If you have an angel investor or benefactor, you might consider naming the theater after this person.
Mission or objective of your business Market research and audience analysis Costs of initial start-up and maintaining the theater Pricing for tickets, concessions, etc. Projected costs and revenues
You might also look into getting a business partner. Look for someone who has connections with the local business community and who has experience raising money and running businesses. Some small organizations run crowdfunding campaigns to raise money. These are appeals to people who are especially interested in your theater, asking them to contribute money to your business. Some independent theaters have successfully run crowdfunding campaigns to raise money to purchase digital projection equipment.
If you are planning to open with a certain new film, you’ll need to schedule your opening for when the film is available.
Contact the film distributor to find out fees for screening a film. [11] X Research source If a movie is in the public domain, this means that no entity holds copyright. Therefore, you don’t need to pay a licensing fee. Check to see if a movie is in the public domain at the Library of Congress’ website.
Invite the local media for a tour of your theater. Be available for interviews. If the local newspaper or TV station does a piece on your business, this will be invaluable for your business.
Concessions can be big earners because their prices can be marked up significantly. For instance, popcorn itself is relatively inexpensive for a movie theater owner to purchase, but can be sold to moviegoers at many times its wholesale value. Popcorn, candy, nachos, soft drinks and other snacks are standard in many theaters. You can choose to include more specialized food, or even alcohol, depending on local regulations.
Your subscription model can offer passes valid for unlimited movies, or for a limited number, within the time period. You can also offer multiple levels or “perks” with different passes. A standard subscription might include just the cost of admission, while a premium package could include cost of admission and a popcorn, etc.
You will have to decide on pricing for rentals, as well as policies regarding use and clean-up. The scheduling for such events will also have to work so that they don’t interfere with the movie run schedule.
Arthouse Convergence is an annual gathering of independent theater owners. CinemaCon is the official convention of the National Association of Theater Owners (NATO). ShowEast is another convention, held in Hollywood, Florida, on an annual basis. CineEurope and CineAsia are international industry conventions for movie theaters and theater chains across the globe.
