Why is movie theater profit margin so low? A better question might be: Why isn’t it negative? Studios know if they raise the wholesale cost of film rentals much more the theaters will go bankrupt, which would kill that distribution channel. See my post: 25iq.com/2017/12/30/mov…
2/ Studios want movie theaters to continue to exist. But if theaters "re-open" and customers don't show up, all bets are off.
"Even prior to bankruptcy, we were spending over 30% of our revenues on lease-related expenses while studios ended up with 60%." bisnow.com/national/news/…
"Even prior to bankruptcy, we were spending over 30% of our revenues on lease-related expenses while studios ended up with 60%." bisnow.com/national/news/…
3/ I learned this from John Malone in the 1990s:
Wholesale transfer pricing power = bargaining power of company A that supplies a unique product XYZ to Company B which may enable company A to take the profits of company B by increasing the wholesale price of XYZ.
Wholesale transfer pricing power = bargaining power of company A that supplies a unique product XYZ to Company B which may enable company A to take the profits of company B by increasing the wholesale price of XYZ.
