Cinemas have different tactical ways of making their money. One way that they make their money is through selling their tickets to different films. A studio that the movie is made with leases the movie to a cinema for a set period of time. Within the first few weeks of the movie being released the cinema only receives around 20-25% of the profit from the ticket. The longer the movie is in the cinema, the more the percentage decreases so the cinema will get less money the longer the movie has been in the cinema.
Concession is the main way that cinemas achieve their targets and make most of their money. Without the concession stands in the cinema, the chains would not make half of the money tat they make today and they would not remain in business. Although the cinema doesn't receive the entire cost from the concession, they do receive a percentage which is where they make most of their money.
Thirdly, they do make some more money from the onscreen advertisements. Sometimes along with leasing a movie to a cinema, they sometimes pay cinema to play a trailer that may sponsor their movie. Or another theory could be that advertisers will pay the cinema to broadcast their ad. If it was a blockbuster as a trailer, the money they receive would be higher because it is wider broadcast film.
How a film gets into a cinema:
- Someone gets an idea for a type of movie they wish too create.
- The creator makes an outline to promote the idea.
- One of the studio makers or an independent investor denies to purchase rights to the film.
- After this stage people are brought together to make the film e.g. screenwriter, director, producer and cast.
- The film is then filmed and sent of to a studio.
- The studio makes a licensing contract with a distributor company.
- The distribution company will then come to an agreement on how many prints/copies to produce.
- The distribution company shows the movie to prospective buyers representing the theatres.
- The buyers have to negotiate with the distribution company to know what they wish to lease on the terms of the lease agreement.
- The final prints are given to the theatres a few days before the opening day.
- The theatre shows the movie for a specified number of weeks.
- You then purchase a ticket for the movie.
- At the end of the period of engagement, the theatre sends the print back to the distribution company and it then progresses to make the payments on the lease agreement.
What does a distributor do?
A film distributor has the responsibility of the marketing of the film. The distribution company is usually different from the production company. Distribution deals are an important type part of gaining business and are vital for the financial status. They create film releases to ensure they reach big audiences and make a profit. They aim to sell and publicise films for the media, different marketing partners and the cinemas.
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