Small cinema grows up

CALEB HARRIS
Last updated 05:00 19/05/2014
Tim Martin, owner of Circus cinema
LOREN DOUGAN/Fairfax NZ
FOOD, WINE AND FLICKS: Tim Martin, owner of Circus cinema, restaurant and bar in Martinborough, says diversifying revenue streams is crucial for a rural cinema’s sustainability.

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The secret to a small firm's success is holding its customers captive.

They're captivated by silver screens rather than iron bars, but Martinborough's Circus Cinema, Restaurant and Bar benefits anyway.

When owner Tim Martin and business partner Al Petrie acquired the Jellicoe St property seven years ago, they researched the town's crowded hospitality market carefully.

With only 1470 people, the south Wairarapa wine village seemed well catered for; but the pair spied a market gap.

Despite accepted wisdom that one cinema screen requires a population of 10,000, they felt food plus film equalled sustainability.

"Once you've paid your royalties and running costs there's not much left; but once people are there, there's a whole lot more they can select from."

Beginning with home-theatre style "E-Cinema" projectors, they upgraded to the more refined "D-Cinema" system as digital technology prices fell.

After listening to the market, Martin and Petrie modified the old adage that the movie game is less about selling tickets than selling confectionery.

"We thought people wanted a quick snack and a movie, but it turned out no - they wanted a restaurant-quality meal."

In two auditoriums seating 49 and 33, customers can have wine, beer and starters, light dishes and desserts with their film. Full-scale plated meals are reserved for the dining room and bar for logistical reasons and because, Martin says, people like to see and savour an elaborate main dish.

There are special challenges when films finish while customers dine or queue for tickets or tables.

"It's tough but you get through; you need really good staff that keep a level head."

Hand-held point-of-sale software, streamlining communication between the floor, the auditoriums and the kitchen, is in development.

A lifelong love of film has underpinned the former accountant and corporate property executive's success.

He relies on two chefs and up to four floor staff, who double as ushers, but one task he won't relinquish is choosing movies.

With Martinborough's many weekenders full of older, affluent Wellingtonians, art-house generally does better than mainstream; while The Hobbit filled many more seats nationally than The Best Exotic Marigold Hotel, in Martinborough the opposite happened.

But films tapping multiple markets are the key; Circus's biggest hit was modern kiwi classic Boy.

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With Circus's revenue minimal alongside a multiplex, it needs good relationships with distributors. They courier Martin new films on portable hard-drives, he loads the very large digital files to his server and an e-mailed license for specific screening dates protects against piracy.

Royalties charged on each ticket range from around 35 per cent for an art-house charmer up to 50 per cent for a mainstream blockbuster, depending on the distributor's marketing costs.

There is a minimum royalty fee on some titles.

Martin, a great-great grandson of Martinborough founder John Martin, says the town's wine tourism-fuelled growth means businesses not usually viable in small rural towns, such as Circus, are surviving.

Revenue has doubled in seven years and keeps growing, and Circus is often sold out.

That's not thanks to social media, he says, but word of mouth. "You've got to provide the experience that generates it. It's all about people, isn't it."

- BusinessDay.co.nz

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