my profile | my password | search | faq & rules | forum home

» Film-Tech Forum ARCHIVE   » Operations   » Ground Level   » Digital Cinema Buying Groups (Page 1)

This topic comprises 2 pages: 1  2

Author Topic: Digital Cinema Buying Groups Rick Deleau Film Handler Posts: 13 From: Portage la Praire, MB, Canada Registered: Mar 2007 posted 03-11-2007 10:06 PM                     Hi. I've received information about Digital Cinema buying groups. Has any one got any information about these buying groups that are working out deals to supply independent theatre's with Digital Projection equipment for the Canadian Market (CBG) ?  |  IP: Logged Mark Gulbrandsen Resident Trollmaster Posts: 16657 From: Music City Registered: Jun 99 posted 03-11-2007 10:46 PM                     Are you talking about the Buyers Group that was formed in the States or is there one noth of the border too? The one down here continues to be a worthless entity. It seems to be more of a platform for a certain individual. Mark  |  IP: Logged Rick Deleau Film Handler Posts: 13 From: Portage la Praire, MB, Canada Registered: Mar 2007 posted 03-12-2007 09:09 PM                     Thanks Mark This buying group (CGB) originated in the US. and it is being supported by Canadian Associations. A Wayne Anderson from the Cinema Buying Group based in the US. is touting the benefits of this group to the extent that if we; (Canadian independent exhibitors) don't join a buying group we will, to put it in their words, "you're either in or out of business". Do you or any other members of Film Tech know any of the pros or cons to joining such a group? It seems that if the independents don't join a buying group ( third party ) the Virtual print fees will not be available to the exhibitor to pay down the cost of digital projectors, as oposed to those who do join a buying group?  |  IP: Logged Barry Floyd Phenomenal Film Handler Posts: 1079 From: Lebanon, Tennessee, USA Registered: Mar 2000 posted 03-13-2007 10:28 AM                        There's lots of talk regarding the CBG, but so far that's about it. I've tried to find out information about what they can do for me as an independant owner, but so far all I've gotten was the response, "If you'll join and pay your money we'll tell you". From my understanding... they don't have anything worked out with any of the suppliers yet. This is the same group that was originally formed to get group buying discounts for concessions items and theatre supplies... and that didn't work out for them either. Until they show me what they can do for me in hard dollars and cents... I'll keep my check in my pocket.  |  IP: Logged Dennis Benjamin Phenomenal Film Handler Posts: 1445 From: Denton, MD Registered: Feb 2002 posted 03-13-2007 12:13 PM                        <<GET READY FOR THE RANT>> CBG or DCBG is an entity like the Amway Company. Have you ever heard of a Pyramid Scheme? In this case - as an independant theatre owner - you believe you are joining other independant owners to get 'buying power' on products that you supposedly can't get anywhere else for the 'special price'. The part you don't know about is: CBG is a money making business. They are not only making money off of what you are paying them, but they are in turn making money off of the products that you are getting for a 'special price'. It's the way dealers make money in their business. You become a dealer of a certain product so everyone in a particular region has to go to you to purchase that product. The dealer is buying a product for a lower price, then turning around and selling to you for a profit. It's the way Capitalism works - but everyone puts their own spin on it. My problem with the CBG is that Independant Theatre Owners are being duped into believing they are getting something they can't get on their own. Do your research. 35mm will be around a while. You don't need to mortgage your house to get a D-Cinema projector that will be obsolete in 5 years. Another thing: J. Wayne Anderson was running a company called R/C Theatres. If you have ever been in one of their now defunct locations - you would would never go back to one. How does this guy get the Showester award? Did they change it to the Scheister award? I'm sorry - I forgot that they give awards to people for running companies into the ground. <<RANT OFF>>  |  IP: Logged Mike Blakesley Film God Posts: 12767 From: Forsyth, Montana Registered: Jun 99 posted 03-13-2007 12:20 PM                        There is a website for the Cinema Buying Group - www.cbgpurchasing.com It's not a pyramid scheme though. There is no pressure to get a "downline" or recruit people "under you" to sell them more product and get them to recruit still more people etc.  |  IP: Logged Dennis Benjamin Phenomenal Film Handler Posts: 1445 From: Denton, MD Registered: Feb 2002 posted 03-13-2007 12:36 PM                        ...to me - most businesses like this are pyramid schemes. There is a product, someone buys the product (with their buying power) - they then turn around and sell the product for a profit to someone else. Sometimes - this continues on for a while. Independant theatre owners trying to get other independant owners to join the group sure sounds like a pyramid scheme to me. "Strength in Numbers" - come on........... Bottom line - in our society - people are not going to get involved with something unless they are making money. They say that they are non-profit - but I know they have a payroll budget.  |  IP: Logged Kenneth Wuepper Phenomenal Film Handler Posts: 1026 From: Saginaw, MI, USA Registered: Feb 2002 posted 03-13-2007 03:47 PM                     This scheme was very effective for the Regional Educational Media Center and subscribing school districts. The REMC collected the orders for tv sets, movie projectors copier paper etc. and then made one very large order. The quantity from the manufacturer, a box car load in the case of the paper, made very substantial discounts possible. The schools then got their items at the REMC cost plus a small handling fee. (Yes, that fee included the salaries of the employees) It was a non-profit deal because the items were not marked up as in a retail operation. Oh Yes, the REMC had to have its own service department because they became the "dealer" and had to do the warranty and other work usually performed by the dealer. This system was called a "consortium".  |  IP: Logged Mike Blakesley Film God Posts: 12767 From: Forsyth, Montana Registered: Jun 99 posted 03-13-2007 08:02 PM                        Sorry Dennis, you are simply wrong. Let's say I'm a member of the cinema buying group. I am under no pressure to get anyone else to join, nor do I have to buy anything from the group if I don't want to. I also don't have to keep paying dues unless I want to remain a member. A pyramid scheme is not really about "selling product," it's about "getting other people to sell product." If I joined a pyramid, and only bought the products (and sold them) myself, I might make a little money but not much, unless I was a super salesman. The secret is for me to get four or five of my friends to buy product through me, then they each get four or five of THEIR friends to buy product, then those people each get four or five of THEIR friends etc. and I get some credit for ALL of those sales. The problem is that by the time you get a few layers deep, you run out of people to join the group, so the pyramid always collapses on the bottom layers, which is why they're illegal.  |  IP: Logged Rick Deleau Film Handler Posts: 13 From: Portage la Praire, MB, Canada Registered: Mar 2007 posted 03-13-2007 09:00 PM                     Thanks Mike for the link to the CBG web page. I checked out their contract. WOW... I can't find a way out. once you join it looks like its up to them as to when they let you go. They should have a clause that says 30 days notice in writing will void the contract. or failure to make payment will void the contract. but they just clearly point out how they can kick you out. Looks one sided to me. What am I going to do when I need Digital Projectors?  |  IP: Logged Mike Blakesley Film God Posts: 12767 From: Forsyth, Montana Registered: Jun 99 posted 03-13-2007 09:44 PM                        I looked at it. There is a mention in paragraph #10 on page 8 as follows: "A participant who notifies the managing director that it is terminating its participation in CBG-NATO," implying that that's the way out. IOW, write a letter and stop paying dues. But I think you are right, there is no place where it specifically outlines a way out for the exhibitor, that I can see. We have a state theatre owners meeting coming up April 11, and our state president is involved with the independent theatre owners committee of NATO, which committee is also involved with the CBG program. I'll definitely bring up this concern at the meeting and report back to this thread.  |  IP: Logged Mark Gulbrandsen Resident Trollmaster Posts: 16657 From: Music City Registered: Jun 99 posted 03-13-2007 11:26 PM                     quote: Dennis Benjamin Did they change it to the Scheister award? I'm sorry - I forgot that they give awards to people for running companies into the ground. On the contrary... it has always been the Scheister Award at Showorst. Really... stop and think for a min.... how manytheater operators REALLY care about theor theaters??? I'd ssay less than 3%... the rest are in it just for the buck. Mike is one that is not into it for the buck, one of the few that really cares.... but even Mike has to realize that the CBG has done absolutely nothing for anyone except A. Wayne Anderson... Here is a guy that obviously doesn't care about his theaters based on what Dennis says. Face it... you can't buy a bulb or even a roll of toilet paper through CBG at all. He has done zip... zilch... notta... Mark  |  IP: Logged Frank Angel Film God Posts: 5305 From: Brooklyn NY USA Registered: Dec 1999 posted 03-14-2007 11:07 AM                        The power behind a cooperative is numbers and profit margin. In order for places like Cosco to actually get cheaper prices is that they buy very large quantities and they have a huge buying base of members. They can go to manufactures and order in quantities that regular supermarkets cannot. In the theatre business there is a finite and fairly fixed number of independent theatre owners with a given number of screens. Given the small numbers, I can't see how such a consortium can weld any advantage over the large chains that are already buying into the conversion. Especially on an item that is so expensive and probably has very little wiggle room to begin with in terms of profit margin. Also given the fact that the digital equipment manufactures and film companies are in a position where they need to convince the exhibition industry that they need to make this move to digital; I can't see that they are going to undercut themselves and offer digital projectors at a variety of prices with large discounts to some customers and not others, be they big chains or a cooperative that comes to them looking like a big chain. They are not going to pit one customer against another by giving significant discounts. If anywhere that a cooperative in the exhibition industry might make headway with being able to get discounts would be in the consumables where there IS a big turnover. A chain buying hundreds of thousands of rolls of toilet paper can expect to get a better deal that one buying tens of thousands, or bulbs or floor cleaner, etc. But as stated above, so far this cooperative or consortium hasn't even been able to do get discounts on any of the stuff that you would think would be easier than on such a specialty item as a $120,000 digital projector. And the other thing about Coscos or BJs is, they make no secret about their prices. The discount prices for items they sell is right there in your face -- it's no major secret; they don't tell you, pay your membership dues and only then do you get to see what discount prices they are selling at and you can compare them with other supermarket prices. While with CBG, everything is cloke and dagger and they act like their are some top secret CIA operation. But the one thing that really irked me with I first heard about CBG, was the threating way they presented, like this was the theatre owner's mob -- it was, "You'd better join us now, or you're out on your own and you'll be out of the business." And my immediate, admittely Brooklyn reaction was, "Yeah? Well screw you too, asshole." But that's just me.  |  IP: Logged Mike Blakesley Film God Posts: 12767 From: Forsyth, Montana Registered: Jun 99 posted 03-14-2007 12:45 PM                        Here's a question I have been tossing around for a while. The film companies are paying a virtual print fee to the finance companies, which is how the equipment is paid for. And of course the theatre pays something as well, right? (As I understand it, this is how the whole thing is working -- so far.) Now. I usually play a new movie every two weeks. (I would love to play a new one every week, but there are those damn two-week minimums.) Therefore, guessing that the VPF is about $1500, my single screen would generate at least $39,000 in virtual print fees every year. (More, if they'd allow us to play one-week on less popular films.) A multiplex in a big city may only open a NEW movie on each of their screens maybe every three or four weeks on the average. Their smallest screens may actually NEVER see a new print. So that multiples may actually generate LESS money PER SCREEN for the finance company than my single screen would. In other words, virtual print fees generated by my small theatre might pay off a single DC system quicker than a large multiplex might pay off 24 of them. So why aren't the finance companies tripping over themselves to digitize every small theatre that is willing to play movies on the break?  |  IP: Logged Rick Deleau Film Handler Posts: 13 From: Portage la Praire, MB, Canada Registered: Mar 2007 posted 03-14-2007 01:47 PM                     Has any independent gotten a price for a Digital Projector, and has the supplier mentioned a rebate from the film Co's for the virtual print cost. Or do we just keep paying (cause were used to it) (quote from Mike Blakesley) The film companies are paying a virtual print fee to the finance companies, which is how the equipment is paid for. And of course the theatre pays something as well, right? Can the independent buy a Digital Projector from these Finace Companies, and how do we get intouch with them? P.S. I realy don't want to go to the Digital Projectors but it seems like we are being forced to. I know there are advantages, but the cost is huge, and the equipment we have will be worthless.  |  IP: Logged

All times are Central (GMT -6:00)

This topic comprises 2 pages: 1  2

Printer-friendly view of this topic

Hop To: Select a Forum: Category: Operations -------------------- Digital Cinema Forum Film Handlers' Forum Large Format Forum Ground Level Feature Info, Trailer Attachments & REAL Credit Offsets Category: Community -------------------- Film-Yak Film Handlers' Movie Reviews The Afterlife Bob Maar's Joke-A-Thon Category: Classified -------------------- Equipment and Supplies Wanted/For Sale Help Wanted/Seeking Employment Category: System -------------------- Software Beta Testing Forum

The Film-Tech Forums are designed for various members related to the cinema industry to express their opinions, viewpoints and testimonials on various products, services and events based upon speculation, personal knowledge and factual information through use, therefore all views represented here allow no liability upon the publishers of this web site and the owners of said views assume no liability for any ill will resulting from these postings. The posts made here are for educational as well as entertainment purposes and as such anyone viewing this portion of the website must accept these views as statements of the author of that opinion and agrees to release the authors from any and all liability.