November 22, 2005

• Well, as you mention downloading, I kind of think that will be the way of the future and video rental stores will die like the dinosaurs. But I could be wrong.
• There's an independent video store up the street from me that does pretty good business renting out old 8-bit NES and super nintendo games as well as a lot of wrestling videos.
• I've definitely thought about it. I've never looked into it or anything though. I just know that my favorite video stores have been of two varieties:: either they had tons of old, out of print movies, or they had lits of rare dvds. Basically, I would go with the rare, obscure films route. My current favorite store (Plan 9 in Bloomington, IN) has lots and lots of import and weird dvds. I would imagine tha tthey buy directly from the companies just like anyone else does.
• There's an indie video rental place here that has all those weird non-mainstream titles you can never find. It's been there for years and somehow still does well. It's centrally-located so equally accessible to anyone, it's cheap and well-advertised, and everyone in Christchurch knows that if you want something that you can't find at Blockbuster, you go to Alice in Videoland. It's like knowing which side of town the beach is on.
• I just moved to a teeny, tiny town in Oregon and was astounded to find the all-time, most fantastic video store I have ever been to. Not only do they charge whatever they want to.....sometimes just a dollar if it's been out for a while, but I rarely get charged late fees. They have this massively HUGE selection of foreign, indie, documentaries, special interest, classic, and everything in between. You literally cannot go in there and come out empty handed. Also, when I first moved there and went in to rent a video, I came in with credit cards, bank statements, driver's license, etc, you know, all the stuff you need to rent a movie, and guess what; all they asked for was my phone number. They didn't even want proof. Isn't that just the craziest thing you ever heard of???? AND, they never write receipts. I wonder what is up with that?;> I love them, totally and completely.
• Hippie.
• The town I'm in has a pretty darn good video store called Video Spectrum. They're good about keeping up with mainstream, indy and international stuff (they're the only store I've ever seen with a separate section for Bosnian-Herzegovenian films! And they separate Italian and Japanese horror!) They also have a good smoothie store attached that's called "Smovies" where all the drinks names are puns on movie titles (Bonnie and Chai is my favorite) Plan 9 in Bloomington is drool-worthy, though. *sigh* I would think that if you offer a) good prices b) a great selection and c) are in a good location an indy video store could do well competing against the Blockbusters of this world. At least, I hope they could.
• How does one go about acquiring the DVDs (distributors)? Bad idea. Search auctions and buy up lots of used tapes and DVDs. To survive against Blockbuster type chains you'll need "other" stuff as has been mentioned. Paying full price is always for suckers. Get your weird stuff from someone else's collection. Creating a deep inventory of obscure titles will be expensive, especially if they get infrequently rented. I'd much rather have a title pay for itself on the first rental rather than the twentieth, especially if it take three years to hit that point.
• sell porn. only way to make money.
• One word which Blockbuster avoids and will guarantee your business success Porn
• See, I just buy it. Why RENT porn? If you buy it, it's always there if you need/want it.
• Why buy it? You miss out on many things. For one, you don't that greasy feeling from the previous renter when you buy them
• One thing I wish our local video store had was an archive online so I could search through and see what they had. I hate the time it takes to wander around all of their shelves, squinting at titles to find stuff and inevitably rushing out empty-handed because I need to wee. Also it would be cool if they took requests to get things in. Oh and actually put the things on shelves in an order that made sense. What they do well though is sometimes have specials on particular genres. They also make sure to check on what new movies are out and popular and make a special place with older titles in a similar genre or even with copies of the earlier flicks if it's a sequel. There was a semi-popular mini-drama here which featured a video store employee who endeared himself to one of his customers by knowing what she liked and recommending movies to her. I think this is what would set a smaller store apart from the dreaded MacVideo ones - knowing what customers would be interested in and recommending stuff. In the mini-drama of course he and this customer started dating and then he mysteriously disappeared and there was much soul-searching on her part etc etc but the whole experience made her realize that she wan't a sad cow after all etc etc...not that I'm suggesting these kinds of shenanigans
• I'd be pretty cautious. The idea of 'movie when you want it, where you want it' is in flux; you have Netflix, tv pay-for-view, and whatever new ideas that will come out of TIVO-style self-programming. I'd really take a good look at how people want to watch movies; I predict that if a title is available in a format that does not require someone to leave their house it's going to win over going somewhere to fetch that same title. TV and movie watchers tend to vote with their ass because most people watch them in the evenings, after a long day at work. The last thing most people want to do is leave the house again, especially if they've got kids. As far as I can tell, there's no reason for virtually everything ever filmed to not be available for some variation of in-home instant gratification, and soon. It's a massive market, and very soon the idea of arranging for a movie in your home rather than going to a dvd rental place is going to be much like the choice now of looking something up online vs going to the Public Library. Maybe look into a business based on helping people deal with the sheer masses of choices available; some kind of subscription GNOVIES service that can be further personalized by adding in all kinds of personal variables for people wanting help deciding which of the 87 zillion instantly available films they will really like.
• I question whether a video store can just buy any old used video and then rent it out. I'm not sure about this, but I believe that in order to commercially rent out movies, you must actually buy a movie from the distributer for that purpose, and the price might be more than the discount retail end-consumers pay.
• I haven't set foot in a video rental place of any sort whatsoever since I got Netflix a couple of years ago, because Netflix is simply better in virtually every respect. I think this is an odd time to consider opening a new video rental store - in my neighborhood, the independents are long gone, and now even the Blockbusters are closing down.
• I looked around and found a lot fo people talking about ithe first sale doctrine in teh USA which says that after you buy it you can do whatever you want. However, just because it is on the internets, doesn't mean it is true! I would think that opening a store that specializes renting dvds that you can find at Blockbuster would be a mistake anyway. If you specialize in niche films, most of the time you will be buying from specialty websites and so their films probably aren't available from a distributor anyway...
• Some pals of mine and I were trying to start a distribution company along the lines of CD Baby. Basically film festival leftovers, foreign/indie stuff would have been what we worked with. We were going to license content in a Creative Commons type manner. However, from what we were able to find out the technology for this sort of endeavor is not quite at the point where streaming full screen and high quality was possible. DL was an option but less attractive, and DVD mass burning equipment was prohibitively expensive. We were in contact with some investors, but I got a career job, another partner moved to Argentina...It didn't pan out. Too bad, this is a niche that hasn't really been filled yet. But yeah, also what some people above said. A physical location seems like an outdated idea unless you're in a huge metro like NYC or something. Even then...It'd be tough. The storefront is an outdated idea for media, as I see it.
• Also as said above, creating a forum where people could be directed to movies they might like would be key. Too many options is often just as bad as too few.
• There's all sorts of cautionary flags you should consider before starting a business, because however cool or cunning or creative you plan to be with your venture, it's still a business. Specifically, you're talking about a store--and any store will have with it some built-in startup and maintenance costs, zoning aproval by the county or other municipality you're in, and then there's the state and Feds (assuming you're a USAian. Other countries will have their own governmental hurdles, though hopefully not as many Blockbusters as the US.) Then there's the fact that you want to open a video store, which, in the face of vanilla Blockbuster is quite admirable, but full of its own issues. Traditionally, and I believe still legally (though I am not a lawyer, of course), video stores must buy commercial copies of the films they rent. Nowadays, technically, I believe they are the exact same DVD you could buy off of Amazon, however, with their higher price, they have bought the right from the content owner to rent it out to you, the consumer multiple times. So instead of paying $19.99 for War of the Worlds, Blockbuster might pay $90 per copy, knowing that they'll rent the bejezuz out of it. And eventually, they'll sell the used copy to a average consumer, which is also kosher. Nowadays, you could probably pick up a bunch of used videotapes and DVDs to build out your store's selection that way--and any regulatory authorities or content owners might not care, because you're too small potatoes. However, even if people advocate this cost-saving approach, I seriously doubt that anyone is going to stand up and say it's all above-the-board legal. (I could go into more detail about Title 17 of the U.S. code that you see on the warning in front of all videos, but yes, the FBI will be happy to fine you if it's worth their time). (But wait, there's more!)
• can just buy any old used video and then rent it out Pretty much yes. Unless it has specific licensing, as is the case in a very small selection of academic films, you can pretty much do as you please. Especially as someone would need to actually notice and register a complaint. The video store I once worked in, circa 1990 or so, rented anything they could get their hands on. And when the budget wouldn't allow for more purchasing of top name titles ($65 a piece) he'd just take an old tape from the studio, copy the movie onto it, then put a "Bee kind please rewind" sticker over the movie title. This was most commonly done with the BETA tapes. Yes, it was that long ago. If buying tapes and you can't find big lots on ebay or an auction house, yes, you'd go to a distributor. You'll get a discount off retail. But I'd have to imagine you could score well at auction. With Netflicks and cable solutions I'm sure they'll come into play more in the future. They have to. But for some of us, the current solutions offer nothing positive and we head over to brick and mortar places for our movies. In my friends and family there's plenty of people who like going and browsing the physical boxes. Some aren't savvy enough to be internet ready, some just like the social aspect, my sister's family just likes to get out of the house. For myself I just don't rent enough movies to justify the Netflicks charge and would feel burdened by having to "get my money's worth" out of it.
• back from commercial break Then we have the very real fact the whole means for people renting films and videos is in enormous flux. You presumably want to open a store that is somewhat of a niche and/or alternative to Blockbuster--something that you think people are looking for. IMHO you are correct, but that desire for "something else" is what video-on-demand, Netflix, and others are doing to meet. As a start-up business, you need to offer something to customers that these non-Blockbusters are not offering. For existing indie video stores that have weathered Blockbuster and Hollywood video and are currently trying to weather the evolution of film/video rental. They already have a customer base--you need to establish yours. It will be tough unless you're in a market where there isn't an indie store. And if you're in a market where there isn't one, you should ask yourself why there isn't one. Perhaps the folks in that area don't like movies as much as you. Perhaps they all use Netflix or really like the bland flavors of Blockbuster. Despite it being a term abused by would-be professionals, 'market research' of some variety is something you need. So if this store is something you're seriously contemplating, I suggest you start saving some ducats and getting information for a business plan, including that market research. You might want to get to know indie video store owners and how they're faring. There's a great one in the DC area called Video Vault that specializes in all sorts of weird films you're hard-pressed to find anywhere else. Their collection is so comprehensive, they have a national mail rental service. Another place to check out is Green Cine,, a Netflix competitor that tries to emphasize the alternative. Both these places are already in business and doubtless are spending many waking hours figuring out how to stay in business. Well worth researching. In case you're wondering why I seem to have given this thought, I've been talking with other indie filmmakers about opening an alternative cinema in this area...and should we attempt this, we are faced with many of the same questions you may have. -BG P.S. Both Video Vault and Green Cine rely on a substantial selection of porn aka 'adult' titles for their revenue. I don't know how much of their revenue, but it seems for an indie video store, you need to consider that.
• Both Video Vault and Green Cine rely on a substantial selection of porn aka 'adult' titles for their revenue I'm working on a not-unrelated business concept right now: you pay me ooh say a small weekly fee and I'll come round to your house whenever you say and act out any porn movie you want - but instead of making love to women, I'll use bread dough. bernockle put me on to this idea actually - he had a similar thing going but it was a bit more "hoot hoot, jizz jizz", if you catch my drift.
• Wow, great comments to all. Many of the questions I was wondering about have popped up. Indeed, I was curious about if one can rent a DVD they simply buy at a store. Seems like one of those things that it is and isn't okay. I live in Canada and a lot of the more yuppie neighbourhoods may be open to the idea of a shop. It's an idea I have always flirted with and one of those things like "I'll write a novel someday." It's a someday, but there definitely seems to be a way to make it a reality -- market research, unique selection and a good location.
• Here's my idea that'll never get implemented by me: pizza and movies delivered together. If you could do beer, too, you might as well. Make a minimum for movies-only deliveries. Although, this is idea may have been obsoleted as the lazy probably already know about Netflix.
• Don't get confused between exhibition fees and rental fees. I know that if you show a movie in public, then you have to pay exhibition fees. Not sure about rentals. The best thing to do would probably go to another town and find a video store you want to model yourself after and talk to the owner.
• Under the current system, part of the rental fee on DVDs and videos goes back to the studio. That's why the studios now make more money off the rental and DVD after-market than in the theatres. See the wikipedia article on Blockbuster for a breakdown of the current system. Apparently a company called Rentrack takes care of the fee cut handling, and the rental stores now pay very low wholesale costs for their copies. This replaced the system where the rental stores paid high commercial purchasing costs, but got free rentals. However, this new system lowers incentives for stocking older or obscure movies.
• I've had the opportunity to observe the intricacies of the video rental market in my neighborhood over the last ten years, involving three different stores, one of them BlockBu$ter. It's led to some firm conclusions. 1. You can compete against Blockbuster, even if they're down the block. 2. Your rental fees must be lower, your late fees and policy must be much more friendly. Your rental periods must be longer (ex. 7-days for anything more than a month old, a week minimum for TV season sets). 3. You must be in a high traffic area, whether it be a large neighborhood of heavy foot traffic, or the local strip-mall with the one grocery store everyone has to go to. 4. That high traffic must consist of a highly varied, multi-ethnic, sophisticated, well-educated population looking for a much wider selection of videos, and a general knee-jerk dislike of corporate Blockbuster. Heavy traffic of 100% suburban whitebread is useless, as 99% of them will want the same movie. 5. You must have significant working capital to get started. One of the stores changed ownership because, despite heavy traffic, the rental fees alone were not enough to carry the original owner through the period when he was changing from tapes to DVDs and having to purchase a lot of new stock. He had no savings to draw on. The new owners already had another successful location to draw on. 6. You must stock enough copies of new movies that most will generally be available after approx. a month. You don't need to promise it's in stock. I've observed that people are not that unhappy about a movie being out of stock, as long as they can find something else reasonably new that they haven't seen. The most successful independent stocks enough copies that most DVDs are reasonably easy to rent within a few weeks of release. 7. Customers are very appreciative of fair fee policies. At the most successful independent, no TV series is more than $10/week/season. TV seasons get cheaper over time based on popularity (i.e. as store cost goes down). Sex and The City seasons are very cheap to rent at this point, because they've been so popular that the store can lower the rates. Old movies only on haggard VHS tape are $2 or less/week. 8. You must have helpful, friendly staff. They need not leave the counter area much. The less successful independent suffers greatly from the unfriendly policy of always forcing you to look through the poorly organized bins for the movie you want. If you go to the counter, even though they're not unfriendly, they won't look anything up to see if it's in unless you swear on your mother that you couldn't find it. I have heard countless people complain about this. At the successful store they happily look it up, and simply ask you to pull the tag off the shelf if it happens to be an in-stock new release. 9. You must be very careful of independent, 'avant-garde' ambience. Think simple, effective, welcoming. The less successful independent cultures an atmosphere reminiscent of an underground grotto. Many average neighborhood people are wary or intimidated. The successful independent is nothing but a bunch of shelves, carefully arranged, on a nice wood floor with some soft lighting, just bright enough to easily read the DVD boxes. Avoid the overly bright institutional/7-11 feel that BlockBu$ter cultivates. 10. A pet helps. I'm indifferent myself, but I've observed countless customers charmed by the cat who hangs out in the successful store as if he owns the place and no one else is there. 11. Customers are charmed by the obscure that they never thought to find. If there is any DVD, or DVD set, that you think will possibly pay for itself, stock it. I've observed countless customers exclaim with impassioned glee when they come across, for example, the DVD set for some TV series they loved as a kid but only lasted one season 20 years ago.
• 12. You need not have a publicly accessible system for tracking older movies. The successful store streamlined operations by realizing that the majority of competition amongst renters is in relatively new releases (relatively because some DVDs are popular enough to stay on the new release wall for well over a year). They have a system of plastic tags velcroed to the wall underneath each new release title so that people can tell what's in stock. For older releases no longer popular enough to merit inclusion on the new release wall, they have the DVD covers filed on the shelves for customers to browse through, but there is no way for customers to tell if something is in stock. This doesn't matter. The store owners seem to have realized that the number of customers looking for any particular older title in a given week rarely exceeds a value of 1. So anyone coming up to the counter looking for an older title they saw on the shelf is very rarely told that it's already out. Even if it is out, because of the breadth of the store's stock, the customer is understanding because they feel they'll be able to find something else. Notice that this is a self-reinforcing system. This system of limited public tracking vastly simplifies store management and makes stocking a browsable library of thousands of constantly shifting DVDs a much more reasonably managed task.