Cineplex has been serving them in select theaters for a decade. Cinema Moderne, since its debut in 2018. At Beaubien, it appeared on the menu in May 2023. Cinema du Parc followed in July. What if the financial health of our cinemas depended on the sale of alcohol?
“It was a lot of work to obtain a bar license at the time,” explains Florence Julien-Gagnier, CEO of Cinema Moderne in Montreal. It was by presenting its small room on Saint-Laurent Boulevard as an amphitheater — just like the Bell Center — that the company was able to obtain authorization to sell alcohol.
Then, in 2021, Quebec changed its regulations and relaxed the criteria allowing cinemas to sell alcoholic products. A little boost for an environment that is struggling to recover from the pandemic.
Pre-tax revenues of Quebec cinemas fell from 157 million in 2019 to 35 million in 2020, at the height of COVID-19, and then rose to 109 million in 2022, revealed the Observatoire de la culture et des communications du Québec in a report published last June. This means that in 2022, revenues were 31% lower than the last pre-pandemic year.
As for the attendance data, it is more horror than comedy. Between 2019 and 2022, admissions fell by more than 39% in the province’s establishments, to stand at 11.3 million.
Attractive margins at the counter
Across the country, in 2022, cinemas earned total revenues of $1,249 million, according to Statistics Canada. Of this amount, 670 million came from admission fees and 474 million from the sale of food and drinks. The food counter was therefore the source of 38% of cinema revenues.
No wonder, then, that farmers attach great importance to food. Especially since it offers a very attractive profit margin.
At Cineplex, gross profit — revenue minus costs — per customer was $6.76 in 2022, only at the food counter, we learn in the chain’s latest annual report. The profit margin from the sale of food and drink was 77.6%. “It’s a contribution that is still important for the company’s profitability,” recognizes Daniel Séguin, senior vice-president of national operations for the chain.
The reality is not the same for smaller cinemas, according to the general director of the Beaubien, Park and Museum cinemas, Roxanne Sayegh. “Yes, it’s still a very interesting share of revenue for our three cinemas,” she admits, but “ticket sales remain significantly greater in our share of revenue.”
On the Moderne side, you have to cross a proper café-bar to access the projection room. Everything is an integral part of the company Post-moderne, which also offers post-production services and filming equipment rental. “We also have a farm [et] we roast our own coffee,” adds Mme Julien-Gagnier. Farm products are also found in the dishes served at the café.
Post-modern has, in a way, created an ecosystem that feeds on itself. “In our case, the [cinéma] on its own, it would not function financially without Post-moderne”, specifies the CEO “But neither does the bar”, adds Alexandre Domingue, founder of the company. “It’s the cinema traffic that keeps the bar going. »
For the experience above all
For all the stakeholders met, the sale of alcohol is also, or even above all, a question of experience for the customer.
“For us, it’s really the living and event side of the place, more than consuming as such. You have to know that people don’t go out [durant le film] to pour another glass,” says Mme Julien-Gagnier.
Same story at Cineplex: “We think it adds added value” which goes beyond the financial aspect, according to Daniel Séguin.
At the Parc and Beaubien cinemas, the general director believes that the possibility of supporting her pop corn of a beer “makes the experience even more pleasant”. “It wasn’t so much about generating a lot of new revenue [qu’une manière] to expand our offering. » The two cinemas also sell beers brewed especially for them by local microbreweries.
A new offer popular with customers, says Mme Sayegh, who does not report excesses linked to excessive alcohol consumption, just like his counterparts.
“There is a decorum,” maintains Alexandre Domingue. There are plenty of films that we play that are available on Crave, Amazon, Netflix. People come to see them [au cinéma Moderne] because they want to see them in theaters. They are serious. »