CINEMA UTILIZATION RATE

One of the most important concepts in determining the profitability of a cinema is the utilization rate. This is the rate which measures the use of the cinema. In 2001, Entertainment Equipment developed a formula which could be used to measure a cinema's utilization rate and which is now used by many in the industry. That formula is as follows:


U = ____________A_________________
nSc x nSe x nSh x nD

Where: A = Admissions
nSc = # of Screens
nSe = # of Seats
nSh = # of Showings/Day
nD = # of Days
Calculated to derive a percentage figure, the result will show the use of the cinema. For example, if the figure derived is 18% then 82% of the time no one was occupying a seat in the cinema while a film was being played. This calculation can be used by a single screen cinema or for a circuit with 10,000 screens. Try it at your cinema, use a month's worth of data. Remember, an increase in your cinema's utilization rate, even by just a few percentage points, will greatly increase your cinema's profitability. So, do everything you can to get people into the cinema and remember: all cinemas are local community-centric.