The Exhibitor (Nov 1941-May 1942)

16 THE EXHIBITOR THE EXHIBITORS PRICE CEILING PLAN (Editor’s Note: A group of independent exhibitors have formulated what they consider to be a fair price ceiling plan for 40 per cent pictures, which is offered for the consideration of not only the United Motion Picture Industry but also the interest of all theatremem. Comments are invited.) FORMULA A 40 per cent picture must do 250 per cent of the playing time unit overhead to gross enough money to pay the exchanges a 40 per cent film rental, and leave the exhibitor a profit equal to 50 per cent of the film rental paid. A 35 per cent picture must do 210 per cent of the playing time unit overhead to gross enough money to pay the exchanges 35 per cent film rental, and leave the exhibitor a profit equal to 50 per cent of the film rental paid. A 30 per cent picture must do 182 per cent of the playing time unit overhead to gross enough money to pay the exchanges 30 per cent film rental, and leave the exhibitor a profit equal to 50 per cent of the film rental paid. A 25 per cent picture must do 160 per cent of the playing time unit overhead to gross enough money to pay the exchanges 25 per cent film rental, and leave the exhibitor a profit equal to 50 per cent of the film rental paid. The 50 per cent profit allowed the exhibitor is based on past experience within the industry, and which has been recognized by practically every distributor in the past. EXPLANATION OF COLUMNS ON CHARTS Column 1 — Percentage classifications of pictures. Column 2 — This represents the overhead for one playing time unit of total weekly overhead figuring one seventh of weekly overhead for six day towns (without Sunday) and one 10th of weekly overhead for seven day towns (with Sundays). Column 3 — This shows the percentage of playing time unit overhead a picture must gross to enable exhibitor to pay the percentage allocation of the picture, and have left a profit equal to 50 per cent of the film rental paid. Column 4 — This indicates the gross a picture must do per playing time unit. Column 5 — This shows the amount the distributor would be due as film rental of the playing time unit gross. Column 6 — This indicates the amount of profit that would be due the exhibitor of the playing time unit gross, which profit is equal to 50 per cent of the amount paid to the distributor as film rental. FOR THEATRES OPERATING ON A SEVEN DAY WEEK 3 units for Saturday 2 units for Sunday 1 unit each other day FOR THEATRES OPERATING ON A SIX DAY WEEK (Without Sunday) 2 units for Saturday 1 unit each other day 10 units total per week 7 units total per week Theatre with Overhead of $350 Weekly Theatre with Overhead of $350 Weekly Picture allocated at this percentage With a playing unit overhead of this amount Must do this per¬ centage of playing time unit over¬ head To gross enough money per play¬ ing time unit To pay film rental at percentage allocated And leave the exhibitor a profit equal to 50 per cent of film rental paid Picture allocated at this percentage With a playing unit overhead of this amount Must do this per¬ centage of playing time unit over¬ head To gross enough money per play¬ ing time unit To pay film rental at percentage allocated And leave the exhibitor a profit equal to 50 per cent of film rental paid 40% $35.00 250% $87.50 $35.00 $17.50 40% $50.00 250% $125.00 $50.00 $25.00 35% 35.00 210% 73.50 25.72 12.86 35% 50.00 210% 105.00 36.75 18.37 30% 35.00 182% 63.70 19.11 9.56 30% 50.00 182% 91.00 27.30 13.65 25% 35.00 160% 56.00 14.00 7.00 25% 50.00 160% 80.00 20.00 10.00 Theatre with Overhead of $500 Weekly Theatre with Overhead of $500 Weekly 40% $50.00 250% $125.00 $50.00 $25.00 40% $71.43 250% $178.58 $71.43 $35.72 35% 50.00 210% 105.00 36.75 18.37 35% 71.43 210% 151.00 52.85 26.43 30% 50.00 182% 91.00 27.30 13.65 30% 71.43 182% 130.00 39.00 19.50 25% 50.00 160% 80.00 20.00 10.00 25% 71.43 160% 114.29 28.57 14.29 Theatre with Overhead of $750 Weekly Theatre with Overhead of $750 Weekly 40% $75.00 250% $187.50 $75.00 $37.50 40 % $107.14 250% $267.85 $107.14 $53.57 35% 75.00 210% 157.50 55.13 27.56 35% 107.14 210% 225.00 78.75 39.38 30% 75.00 182% 136.50 46.95 20.47 30% 107.14 182% 195.00 58.50 29.25 25% 75.00 160% 120.00 30.00 15.00 25% 107.14 160% 171.42 42.85 21.43 Theatre with Overhead of $1,000 Weekly Theatre with Overhead of $1,000 Weekly 40% $100.00 250% $250.00 $100.00 $50.00 40% $142.86 250% $357.14 $142.85 $71.43 35% 100.00 210% 210.00 73.50 36.75 35% 142.86 210% 300.00 105.00 52.50 30% 100.00 182% 182.00 54.60 27.30 30% 142.86 182% 260.00 78.00 39.00 25% 100.00 160% 160.00 40.00 20.00 25% 142.86 160% 228.58 57.14 28.58 For instance, a theatre which has a playing time unit over¬ head of $50.00, and which runs a 40 per cent picture on Sunday, Monday, and Tuesday (four units of playing time) must gross 250 per cent of $200.00, the overhead for four units of playing time, or a total gross of $500.00 in these three days in order to pay a film rental of $200.00 and have $100.00 left for profit. If that picture does not do enough gross to leave this much profit for the exhibitor, it should then revert to a 35 per cent allocation. If that picture does not do enough gross to leave this much profit for the exhibitor, it should then revert to a 30 per cent allocation. If, at a 30 per cent allocation, the picture does not leave this much profit for the exhibitor, it should then revert to a 25 per cent allocation. This formula would act as a ceiling and require a 40 per cent picture, from any and all companies, to measure up to a necessary gross in order that the picture remain in that allocation given it by the exchanges. It would eliminate further, the contention, by an individual distributor, that a particular picture of his grossed as much as one of his previous pictures, which he charged at 40 per cent, even though the gross on his pictures were substantially less than is here required, or is done by 40 per cent pictures from some other distributors. ( Continued on page 20) March 18, 1942