The only direct costs for film exhibition are film hire costs (including transport). These are highly variable depending on a number of factors including the number of screens you have, the length of run you can offer, your bargaining power with distributors and the projected popularity of the film. In the recent past, with 35mm film distribution, it has to be said that in the UK it is distributors who have most of the power in the supply chain. With a limited number of film prints available, they decide which cinemas get which films and when, their objective being to maximise revenues and cover the cost of their release prints from the box office in the opening fortnight. With the arrival of more cost-effective digital film distribution, the low cost of prints means that, theoretically at least, more cinemas have access to desirable titles on or closer to the release date.
The percentage film hire figure can be anywhere between 25% and 60% of box office (after deducting VAT from the ticket sales). In addition each distributor will have a minimum guarantee which they would receive from the exhibitor regardless of the admissions i.e. if no one came to the screening it is the amount you would still have to pay to the distributor, these range from £75 - £150. However, for the purposes of planning, an average anywhere between 35% and 45% of box office can be used. If you plan to do your own film booking as a stand-alone operation you should budget at the higher end of this scale. In general, small operators have to pay higher rates.
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Read the full article on the Culture Professionals Blog, The Guardian
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