The Pros & Legalities Of Private Rent-Outs

Private rent-outs are a fantastic way for a theater to generate additional revenue. Renting out your venue for birthday parties, school trips, or even proposals can be a fun way to bring in more customers and offer an additional service to your community. Like any business venture, risk mitigation must be considered to protect yourself, your business, and your patrons. 

The price of renting your venue must cover all business expenses for the time the party is renting your space. When determining the rental price of your venue, you must consider the cost of film rental, labor, cleaning costs, insurance costs, and how consistently you are renting out your space to ensure that you are staying profitable. On the other hand, comparing your rental price with other theaters in your area will ensure that you remain competitive in your market.

Your business can be exposed to liability in many ways, including food poisoning. If guests bring in outside food and they contract food poisoning, your business could be held liable even if your staff did not handle the provided food. To mitigate this risk, you could ban outside food from your establishment. This would be beneficial to your business by increasing concession revenue as well as reducing cleaning costs, but it may be a deterrent for parties that would like to bring in pizza, birthday cakes, etc. Another option would be to write an outside food liability clause into your contract. This would clear your venue of any legal responsibility tied to food safety violations. You must specify to your staff that they are not allowed to handle the outside food in any way. If you allow the party to bring in outside food, we highly recommend charging an outside food fee to make up part of the revenue for the lost concession sales. 

Tech liability also must be addressed in your contract. Projectors are the center of your business and must be protected. If a rowdy partier decided to throw a drink in the booth and destroy your projector, your screen would be down until the projector was replaced or repaired. If one of your renters damaged your screen in any way, you would not be able to show a film until your screen is replaced. For single screens especially, this could be devastating for your business. For these reasons, the rental contract you put in place must have a tech liability clause.

While the vast majority of patrons and business owners mean well, you cannot rely on good faith alone to protect your interests when renting out your venue. Contracts are in place to protect both parties in the event of a disaster. While legal counsel is always the best option when creating a rental contract, reaching out to the knowledgeable staff at Clark Film Buying can provide great insight when starting your private rent-out journey.