Start a Movie Theater

Creating Cinematic Dreams: Owning and Operating Your Own Movie Theater

2 women sitting on blue leather chair holding white and red plastic cups

Camera Icon Felipe Bustillo / Unsplash

Movie Theater - Picture Yourself

Sure thing, a movie theater is a popcorn-kernel of an idea that's ready to pop! In this business endeavor, you're looking at becoming the operator of cinematic dreams by showing the latest movies in a communal viewing experience. Don't forget the sequels - concession stands with popcorn, soda, and candy – because that's where the real blockbuster profits often come from. Though with the increasing popularity of streaming services, owning a movie theater can seem like the final scenes of a dramatic thriller, but with a unique twist, great ambience, you can still draw movie-goers in for that big-screen experience.


Grab Your Business Website Name

Before you get caught up in the whirlwind of setting up your business, invest in a domain name. It's a small but significant step that lays the foundation for your brand and makes it easier for customers to find and trust you. Just like you wouldn't build a house without securing the land first, don't build a business without securing your domain name.

"Why? Can't that wait?" Here's why it shouldn't


Movie Theater Quick Business Check

This a quick reality check to help you identify the strengths and weaknesses of your business concept before you dive in.

Business Idea: Movie Theater

Expected Percent Margin:

  • Gross Margin: 40-60%
  • Net Profit Margin: 10-15%

Earnings Expectations:

  1. Daily Earnings: $1,000 - $3,000 (depending on movie screenings and concessions)
  2. Weekly Earnings: $7,000 - $21,000
  3. Monthly Earnings: $30,000 - $90,000
  4. Annual Earnings: $360,000 - $1,080,000

Actions to Hit Those Numbers:

Movie Procurement and Scheduling:
  • Licensing: License movies from distributors, ensuring a mix of blockbusters, indies and family films.
  • Scheduling: Continuously update screening schedules throughout the week to increase potential audience.
Concession Stand Management:
  • Popcorn: Popcorn has a massive margin. Make sure to offer a variety of sizes and flavors.
  • Drinks and Candies: Offer a wide range of beverages and candies, often high margin items.
Marketing and Customer Acquisition:
  • Movie Premieres and Events: Host movie premieres and create special events to increase publicity.
  • Loyalty Program: Introduce an enticing loyalty program to encourage repeat customers.
Sales and Customer Experience:
  • Staffing: Hire staff who can ensure a great customer experience from ticket sales to clean screenings.
  • Comfort: Invest in comfortable seating and excellent sound-system to give value for money.
Cost Control:
  • Energy Efficiency: Use energy-efficient lighting and control heating, ventilation, and air conditioning (HVAC) costs.
  • Maintenance: Regular maintenance of the overall theater and tech will help avoid bigger costs later.

Business Operations:

  • Open Hours: Operation hours should cover both matinee and evening showings 7 days a week.
  • Transaction Volume: Aim for at least 100-200 ticket sales per day, not including concession stand sales.

Please note that numbers can vary depending on various factors like location, number of screens, local demographics, and more. Always work with a business consultant or financial advisor for personalized advice.


Step 1: Determine if Starting a Movie Theater is the Right Endeavor

Breakdown of Startup Expenses

Before starting a movie theater, it is important to understand the startup expenses associated with the endeavor. These expenses can include the cost of the building, the cost of the equipment, the cost of the staff, and the cost of the marketing. Additionally, the cost of licensing and permits should be taken into account. It is important to research each of these expenses and create a budget that will cover them.

Breakdown of Ongoing Expenses

Once the movie theater is up and running, there are a number of ongoing expenses that must be taken into account. These expenses can include the cost of the film prints, the cost of the staff, the cost of the utilities, and the cost of the maintenance. Additionally, the cost of advertising and promotions should be taken into account. It is important to research each of these expenses and create a budget that will cover them.

Examples of Ways to Make Money

In order to make money with a movie theater, it is important to understand the different ways to generate revenue. These can include ticket sales, concession sales, and advertising. Additionally, it is important to consider other revenue streams such as special events, private screenings, and sponsorships. It is important to research each of these revenue streams and create a plan to maximize them.

Step 2: Name the Business

  1. Brainstorm potential names When it comes to naming a business, it is important to brainstorm potential names. Brainstorming can help to come up with creative ideas that may not have been considered otherwise. Think of names that are catchy and memorable, but also relevant to the business. It is also important to consider the domain name availability for the potential names.

  2. Consider the target audience When coming up with potential names, it is important to consider the target audience. Think of names that will appeal to the target audience and are easy to remember. It is also important to consider the potential for the name to be used in marketing and advertising.

  3. Research the competition It is important to research the competition when coming up with potential names. Consider what other movie theaters in the area are named and how they are marketed. This can help to come up with a name that stands out from the competition.

  4. Check for trademark availability Once potential names have been identified, it is important to check for trademark availability. This can help to ensure that the name is not already in use by another business. It is also important to check for domain name availability to ensure that the name can be used for a website.

  5. Finalize the name Once potential names have been identified and checked for availability, it is time to finalize the name. Consider the pros and cons of each potential name and make a final decision. Once the name is finalized, it is important to register the name with the appropriate state and federal agencies.

Step 3: Obtain the Necessary Licenses and Permits

The third step in starting a movie theater is to obtain the necessary licenses and permits. Depending on the state and local laws, there may be a variety of licenses and permits required to open a movie theater. These may include a business license, a sales tax permit, a liquor license, a health permit, and a fire safety permit. It is important to research the specific requirements for the area in which the theater will be located. Additionally, it is important to contact the local government to ensure that all the necessary permits and licenses are obtained.

In some cases, the local government may require a zoning permit to ensure that the theater is located in an appropriate area. Additionally, the local government may require a certificate of occupancy to ensure that the theater meets all the necessary safety requirements. It is important to note that the process of obtaining the necessary licenses and permits can take several weeks or even months, so it is important to plan accordingly. Furthermore, it is important to note that the cost of obtaining the necessary licenses and permits can vary depending on the state and local laws.

Step 4: Find a Suitable Location

Finding a suitable location for a movie theater is a critical step in the process. It is important to consider the local population and the potential customer base. It is also important to consider the competition in the area and the potential for growth. Additionally, it is important to consider the cost of the property, the availability of parking, and the zoning laws in the area. When selecting a location, it is important to consider the size of the theater, the number of screens, and the seating capacity. It is also important to consider the amenities that will be offered, such as concessions, restrooms, and seating. Additionally, it is important to consider the accessibility of the theater, such as whether it is close to public transportation or major highways. Finally, it is important to consider the potential for expansion and the potential for additional revenue streams, such as hosting special events or renting out the theater for private screenings.

Step 5: Acquire the Necessary Equipment

The fifth step in starting a movie theater is to acquire the necessary equipment. This includes the projector, sound system, seating, concession stand, and any other necessary items. It is important to research the different types of equipment available, as well as the associated costs. Additionally, it is important to consider the size of the theater and the types of movies that will be shown. For example, if the theater will be showing 3D movies, then a 3D projector will be needed. It is also important to consider the cost of maintenance and repair of the equipment. Additionally, it is important to consider the cost of any additional items, such as popcorn machines, soda machines, and other concession items. Finally, it is important to consider the cost of any additional services, such as cleaning and security.

Step 6: Hire Employees

Hiring employees is an important step in starting a movie theater. It is important to find employees who are passionate about movies and customer service. It is also important to find employees who are reliable and trustworthy. It is best to hire a mix of full-time and part-time employees to ensure that the theater is adequately staffed. When hiring employees, it is important to consider the cost of wages, benefits, and taxes. It is also important to consider the cost of training and onboarding new employees. Additionally, it is important to consider the cost of background checks, drug tests, and other compliance requirements. Finally, it is important to create a job description that outlines the duties and responsibilities of each position.

Step 7: Market the Business

Once the business is up and running, it is important to market it to potential customers. This can be done through a variety of methods, such as advertising in local newspapers, creating a website, and using social media platforms. Additionally, it is important to create a customer loyalty program to encourage repeat customers. This can be done by offering discounts, free tickets, or other incentives. It is also important to create relationships with local businesses to help promote the theater. This can be done through cross-promotions, such as offering discounts to customers who show their receipts from other businesses. Finally, it is important to create a presence at local events, such as festivals and movie screenings, to help spread the word about the theater.

Step 8: Set Up an Accounting System

Setting up an accounting system is an important step in starting a movie theater. It is important to keep track of income and expenses for tax purposes and to ensure that the business is profitable. An accounting system should include a chart of accounts, which is a list of all the accounts used to record transactions. It should also include a general ledger, which is a record of all transactions and a trial balance, which is a summary of the business's financial position. Additionally, an accounting system should include a system for tracking inventory, payroll, and accounts receivable and payable. It is important to set up an accounting system that is easy to use and understand. A professional accountant can help set up an accounting system and provide advice on how to use it.

Step 9: Open the Doors

The ninth and final step in starting a movie theater is to open the doors to the public. This is the most exciting part of the process, as it marks the official launch of the business. Before opening day, it is important to ensure that all of the necessary permits and licenses have been obtained and that the building is up to code. Additionally, it is important to have a grand opening event to draw in customers and create a buzz about the theater. Advertising campaigns should be launched in the weeks leading up to the grand opening, and promotional materials should be distributed to local businesses and organizations. Finally, the staff should be trained and ready to go on opening day. With all of the necessary preparations in place, the theater can open its doors and begin showing movies.


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