If owning a movie theater has always been your dream, then you must first work out how you will afford this theater.
A movie theater is a great option for those who enjoy the movie industry and maybe even have a building or a location in mind.
There are lots of different types of movie theaters out there, so our estimates are not going to be accurate for all movie theater types.
However, these costs will give you a general idea as to what to expect and whether or not you can afford to build a movie theater.
It is best to talk to a professional and potentially someone who has started a movie theater before taking these steps to build your own movie theater and invest your money.
How Must Does It Cost To Build A Movie Theater?
Building a movie theater can cost a few hundred thousand or close to $5 million.
Most of this depends on where you are building your movie theater and the size of theater you are looking to build.
Obviously, a single-screen movie theater is going to be much cheaper to build than a multiplex.
In addition, the number of seats is going to impact the overall costs that you will pay as well.
Here are 13 factors that will influence the overall cost.
1. Business Fees & Registration
The first step of building any business is to first make sure that the business is legal and compliant.
There are registration fees and sometimes legal fees associated with starting up any kind of business.
Depending on the way you decide to build your business, you could pay as little as $400 and as much as a few thousand dollars.
This is typically done with the help of a lawyer or accountant, so you will have to consider their fees as well.
2. Licenses And Permits
Movie theaters are going to serve people.
As soon as you open the doors of a business to have customers come in, you can expect to have to get licenses and permits.
The fire department, health department, and public safety are likely going to have to do some inspections around the place.
Ensuring that the air, the water, and the experience are all safe for those entering and exiting the theater is very important.
If you do not have the proper licensing and permitting, you will see that you won’t even be able to launch the movie theater.
Expect these fees to be anywhere from $1,000 to $20,000.
3. POS System And Accounting Setup
A point of sale system will be essential to be able to sell tickets and concessions.
If you don’t have a system like this, you won’t be able to process large numbers of people coming in to see a film.
Some of the POS systems are very expensive, but you can lease them instead of purchasing them.
However, the initial upfront costs can still be relatively high.
You will also need to set up some kind of an accounting system that allows you to keep track of bills, payments, payroll, and more.
Expect these costs to be an additional $5,000 to $25,000.
Marketing is going to be an ongoing cost and should really end up being a percentage of your total sales.
Some movie theaters make the mistake of backing off of marketing spend when they are doing well.
Typically, if you do this, you will end up with a lower overall profit for the year because of unexpected slow times.
It always makes sense to pay attention to the marketing and plan for higher initial marketing costs of close to $5,000 to get the information out there about the movie theater and its grand opening.
You won’t be able to open the doors of your movie theater until you have properly considered the cost of insurance.
Insurance costs can be high because that will help protect anyone who could get hurt at your theater.
The insurance costs needed will likely include a liability policy, theft, property insurance, and worker’s compensation.
Again, the size of your theater and the services you offer are going to affect this price.
However, the total amount that you pay will likely be well over $10,000 and sometimes as high as $40,000.
6. Lease Or Build A Space
If you don’t already own a place to show the movies, you are going to have to lease or build a space.
Before you can build a space, you may also need to purchase land.
As you can imagine, by the time you purchase land and then build a movie theater, you will be looking at well over $1,000,000 in costs.
For those who are looking to lease a preexisting movie theater, the costs could be closer to the hundreds of thousands as opposed to the millions.
A large movie theater could lease for close to $350,000 a year or more, depending on the location.
Of course, this will change as you move around the country, but you can expect this to be one of your top costs.
If the movie theater is not already equipped with water, electricity, and phones, you will have to get those in place as well.
These utilities will have to be set up by contractors before they can start providing service.
Once the utilities are up and running, expect to pay thousands of dollars a month to keep the lights on and keep people cool while they are in the theater.
The utility setup will likely be around the range of $5,000 as long as there is some preexisting setup already in place.
8. Operating Costs
One of the hardest parts of opening up a movie theater is remembering that you must save a good amount of money for the operating costs.
So many people can’t wait to jump into an investment, and then as soon as they do, they realize that they don’t have enough money to pull it off.
Try to determine what all of your monthly operating expenses are going to be and save up for about four months’ worth.
It can take a long time to start turning a profit, and you don’t want to put yourself out of business before you even start.
It’s a good idea to have $50,000 to $100,000 in the capital that you can put back into the business should you need to after you have gotten things started.
9. Movie Projector & Movie Startup
Aside from the initial cost of a building or a lease, the projectors, technologies, and rights to show the movies will be your other high costs.
You will need to purchase screens, sound systems, and equipment.
This equipment is going to be priced quite a bit higher than the equipment that you think of using at home.
In addition to the equipment, you will need to have things professionally installed.
If you are not skilled in electrical work or audio or visual work, be prepared to pay a good amount of money to have these things done for you.
Setting the movie theater up so that it is ready for guests and customers is likely going to cost you more than $300,000.
This is an area where it makes sense to spend a bit more money and get top-of-the-line equipment.
Those who care about movies are going to be willing to pay a bit more if they are at a theater where the movie looks good, sounds good, and is enjoyable.
If you don’t spend enough in this part of the process, it could end up coming to bite you in the end.
10. Furniture And Storage Equipment
The movie theater will need equipment for people to sit, and then there will be equipment in the storage area as well.
The shelves for all types of candy, popcorn makers, signage, and even security cameras must be installed.
If you plan on having one cash register or ten cash registers, these all need to be put into place.
Some movie theaters have 100 seats, and others will have 500 seats.
You have to determine how many seats you are going to need.
Although the cost of the seating is going to be relatively high, in the end, this is how you will make revenue, so there will need to be enough of them in place throughout the theater.
In addition, there will need to be an office space in the theater to help run the business.
This office will need to be set up with computers, desks, and all the necessary equipment.
Plan on spending about $25,000 for all of these extras to get the movie theater ready to open.
Making sure the movie theater is properly secured and protected is quite important.
It is good to have the proper security in place so that people can feel safe and to ensure that you are protecting your business.
A closed-circuit television system will need to be installed throughout the movie theater, and it is a good thing to put it in before the movie theater opens.
The cost will likely be between $5,000 and $10,000, depending on the overall size of the movie theater.
A website is not a very large expense, but every movie theater will have to start one.
When people look for a business and whether or not it is open, if the pricing is good, and to see what movies they are playing, they will look to get it from a website.
A website is a great thing to start, and you can do it for as little as $100 and as much as $10,000.
For most movie theaters, a very simple and basic design will be all that is necessary.
If you simply put together a website that is clean-looking and easy to read, people will have no trouble getting the information they need and using the website to avoid calling you to ask questions.
Setting up an accurate website with the information that customers need is much better than trying to field phone calls from potential customers all day.
13. Extra Fees
Last but certainly not least, you have to have some money aside for some miscellaneous fees that could come up.
Maybe employees were more expensive than you thought, or maybe you ran into a permitting issue when trying to get the electrical issues fixed.
Whatever it is, you must plan to have some extra funds available if you are going to open a movie theater.
The more you can properly set money aside and get yourself into the proper position, the better the chance of your movie theater becoming a successful endeavor.
So many places have to shut down early because they don’t have the proper funds in place right from the start.
Don’t let this happen to you.
Plan for the extra expenses and then be ready to pay out when the time comes.
Is Building A Movie Theater Expensive?
In most parts of the country, building a movie theater is going to be very expensive.
Those who have a genuine interest in the industry often try to start with something relatively small.
They will take a small art studio and start turning it into a place that will show some independent films.
This concept helps people get used to the idea of owning a movie theater and all that will be involved.
Once you have done this for a few years, you can see how things work out and whether or not it is a good option for you for the long term.
If you have partners and a large group that wants to invest, this decision may be a little easier.
The price to purchase a movie theater and get involved in this industry is likely going to cost $700,000 and up.
Most people will tell you that having $1,000,000 is the best-case scenario for starting your movie theater.
When you spend less than this, you can expect to have some trouble with the movie theater making it for the long term.
With things as tight as they are in this industry and the margins on the movies being seen, it is best to have a bit of experience before you get involved.
Overall, building a movie theater is expensive, but it is very likely worth the price that you will pay in the end.
As long as you are smart about running the business and managing the funds, the movie theater should prove to be profitable.
As you can see, there are quite a few aspects involved with the movie theater industry.
You will need to consider what the costs are for the interior, exterior, and overall safety of the building as well.
The more time you spend worrying about the little costs and how they will add up, the worse it will be from a stress standpoint.
Try to consider the fact that you will need a lot more than your initial calculation if you want to ensure that you have enough money to keep the doors open.
There is nothing worse than having to shut down your movie theater because you didn’t save up enough money to begin with.
This is a big decision, and you must make sure you are ready.