Movie Theaters were run like Airlines?
worked in the airline ticketing business since 1999 and
having flown since 1964 I've had plenty of time to think
about the industry.... and the little idiosyncracies in
the way it operates. If we could all run our businesses
like the airlines we'd be wealthy...or maybe broke!
Let's say that
after being in the Airline ticketing business, I decide
to move to open a new business and I'll use the airline
industry as my model. What would be a good business to model
after the airlines. How about one with seats? Either a movie
theater or a restaurant?....ok...how about? ....a movie
all...how much should I charge? I have 250 seats-25 on the
balcony and 225 on the main floor. I'll take the balcony
seats, make them a little larger, add a couple of extra
bathrooms upstairs and have a waitress come in to serve
snacks. And I'll charge, let's say $35 for a ticket. That
was easy(and profitable!).
Now for the general
admission. I'm going to randomly divide all the seats into
five groups: A-B-C-D & E(100 in the "A" group
which I'll sell for $8 each and then the other for groups
I'll sell for between $4-7 each). There's no need to tell
which groups charge how much because.... that keeps changing.
It has nothing to do with when I purchase them or where
they are located in the theater(someone paying $8 and bought
the ticket 2 days in adavance can be sitting next to someone
who bought their ticket yesterday for $4!), it's kind of...ummmm...
the lower tickets, as I choose so....it may be available
tomorrow, even though it's not available today..... but
if people stop buying tickets, I'll release some lower cost
ones..so the suckers that planned ahead will have paid more
than this last group. Got the picture?
But what about
a double feature....hmm.....if someone wants to purchase
tickets for both movies, it's.... $12. Now suppose they
want to watch only the first movie, it will cost them $14
to see the first movie.(No, this isn't the ntone way ticket,
but it the way some of the fares work. A friend of mine
wanted to fly back from The Bahamas with me. He wanted to
go to Atlanta, I wanted to go to Chapel Hill. The flights
went through Atlanta to Chapel Hill-actually Raleigh-Durham
Airport. That's easy enough, he'll buy a ticket to Atlanta,
I'll buy mine to RDU and we'll fly together, but when we
went to purchase the tickets- it was more expensive to fly
to Atlanta than RDU. So... he bought a ticket to RDU and
got off in Atlanta.(Illegal, according the the Airlines
code of conduct(that's OUR code of conduct-not THEIRS!)
and saved about $80. I'll have to figure out a way to protect
my profits by discouraging my movie patrons from trying
to pull the same stunt. Maybe I'll have to collect their
tickets as they leave the theatre to protect my profits.
OK... you see
where we're going with the fares.... How about service?
I think the theaters have that system down.... the snacks
seem....kind of expensive for what you get! Just like...
those plastic pre-packaged "meals" that they offer
us on the flights. Now my theatre profits are dropping a
little so I have to prop them up....Let me get rid of a
couple of the workers and then raise the price of the snacks
just a little...
Ah, we haven't
even talked about the workers. The first thing I'm going
to do is force them to sign a contract agreeing that if
they are injured on the job, they will not recieve any compensation.(Yes,
a friend of mine was a flight attendent on the Delta flight
that crashed in Dallas in 1985
-2 August 1985; Delta Air Lines L1011-1; Dallas, TX:
The aircraft crashed shortly before landing after encountering
a wind shear from a passing thunderstorm. Eight of the 11
crew members and 128 of the 152 passengers were killed.
One person in a passing car was also killed. She was
one of 17 to survive, but she had signed a mandatory no-compensation
agreement with Delta in the event that she was in a crash,
and after a couple of years they began to pressure her to
discontinue her therapy(for dealing with her survivor's
guilt), because it was costing the airline too much money).
OK, lets see if I can lower my cost of my insurance by not
protecting my movie theater employees.... that's easy...
no elaborate contracts... I'll just put them on part time
What about the
movies to show? Lets go for the profitable ones... the sure
things. Along with the rest of the theaters in the area....let
me just check their prices and ssell for the same thing...who
cares if there aren't enough people around to see the movie...if
I find that I'm losing money, I'll just go to the local
government and ask them to bail me out with a little loan,
courtesy of the people who I've been overcharging since
I opened my little theater.
What other lessons
can I learn from the industry? Pack my seats as close together
as I can to get more bodies into the theater....limit the
amount of damages to their possessions should they be damaged
in my theater....
And how could
I forget- I'll require my patrons to confirm their seats
3 days in advance. If they don't confirm, then I'll sell
their ticket to someone else and turn them away from the
theater if it's full.(that's one I CAN'T understand...if
I pay for my ticket, I should have the right to my seat
flying empty if I decide to not show up!)... But that little
rule would be tied into my other one...I'll sell MORE tickets
than I have seats for! That way if someone doesn't show
up, I have extra seats and am assured a full theater...but
if EVERYONE shows up... well, that's just their problem...
you didn't confirm- tough luck!- Here come to the movie
tomorrow instead. You did confirm!- ah yes, you did....would
you like two tickets to one of my movies?-Don't forget to
confirm that you're coming to the show or you may end up
with two more tickets!(Oh, did I mention that you have to
use them within a week or else they'll be invalid).
"Oh my God,
the cost of fuel just went up"...we're going to have
to add a fuel surcharge to the cost of your ticket.... "well,
look at that- the price of fuel is dropping..... no need
to drop the fuel surcharge.... it really helps us increase
our profits! Let's just stick it in with all the other taxes
and no one will even notice!"...following me on that
You know, this
movie theater business is a little harder to manage than
I thought. I think I need to bring someone in and have him
oversee the whole operation. I'll pay him a huge salary
and a nice bonus whether he turns a profit for me or not.
And if things get really bad, I'll let him go. Of course
with a huge bonus to leave!
is a lot we can learn from studying the streamlined operation
of the happy-go-lucky friends of ours who are flying the
skies! If we could all operate like they do...we'd all be........broke?