The Historic Fox Theatre of Newton, Kansas

*** BUSINESS PLAN 2004 ***

Where We're Going...and
How We'll Get There

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History

The ancestry of the Fox Theatre can be traced back to BEFORE the beginning of the movie business. In 1914, a Great Fire devastated downtown Newton including the original building on the site of the present Fox Theatre.

As a result of that disaster, Mr. H.E. Herbert (owner of the Gem theatre, then at 621 Main) entered upon an agreement with Mr. T.H. McManus for the erection of what was then called "a first class theatre building" at 520 Main. Subsequently, the Royal Theatre was opened at the location in the winter of 1914-1915 - however, the Royal was not constructed for motion pictures - it was a state-of-the-art vaudeville stage!

In the six years of its history (1915-1921), the city outgrew The Royal. Consequently, it was closed in the fall of 1921 and extensive changes were made - enlarging and refitting - bringing it up to the standard of "the best in the land." The stage was reconstructed to accommodate large vaudeville attractions, the seating capacity increased to 750 and the lobby and foyer were changed and refurnished. Several feet were taken from the small shops in the front of the building and the building itself was extended to align with the alley, making it 165 feet deep. When finished, at a cost of approximately $20,000, the new theatre stood as "the most up-to-date and modern building of its kind."

That conformation persisted until later in the 1920's when a small screen was added to fit inside the stage's proscenium arch and silent movies began - a few years later a sound system was added and Newton had talkies! During that period of change, the theatre became known as The Regent. Then, in 1955 the big and final change occurred. Twentieth Century Fox, in a national campaign to buy "old" theatres and convert them, purchased The Regent and after extensive renovation turned it into the wide-screen, cinemascope motion picture theatre that stands to this day, almost 50 years later.

All was well until the 1990's when movie multi-plexes arrived on the scene nationally and then locally a few miles south of Newton. After a few struggling years, the economies of the multi-plexes killed the Fox and it was abandoned by its owners to the City of Newton in 1999.

There it sat empty and unused . . . until we discovered it and took on the adventure of bringing it back to life!

The Restoration and Rebirth Process

Theatre restoration is a process that seems highly romantic but, unfortunately, is steeped in grim financial reality. Even though few projects create such widespread local excitement as historic restoration, only creative financial management, and very cooperative relations with the community at large can ensure that such significant structures are reborn.

However, by following the recipe for success that follows, a recipe followed by historic theatres in cities large and small across North America, the Historic Fox Theatre will soon reclaim its place at the center of Newton.

The Recipe for Success

1. Newton's existing 5-county trade area (Harvey, Sedgwick, Reno, Butler, Marion) of approximately 620,000 residents (a quarter of the population of the entire state of Kansas) combined with its central location in the state and at the intersection of several major highways, including I-135, presents a more than sufficient potential audience base for the Fox to operate successfully as a performing arts center and meeting space.

2. The Fox is, within its market, sufficiently unique, appropriately sized and highly regarded as a facility to ensure a high level of community and event industry use after renovation.

3. The Fox is in a favorable competitive position within its immediate and extended market.

4. Ample opportunity exists for mutually beneficial programming and marketing efforts between the Fox and local organizations and venues.

5. Estimates of operation revenues and expenditures indicate the Fox's ability to achieve economic self-sufficiency in the first year of post-reconstruction activity (even excluding grants acquisition common to historic theatres and continuing charitable contributions).

6. Upon completion of the restoration phase, the Fox will have only the most minor competitive impact upon the local fundraising scene, with this impact being outweighed by its ability to serve as a tool for other groups' campaigns and as a vibrant cultural center for the entire town.

7. The Fox is well situated geographically to provide beneficial opportunities for block-booking of events with other presenting venues within the state.

8. The Fox's restoration and first five years of operation will create a positive economic impact upon the community estimated in excess of 1 million dollars per year as its successful presence serves as an economic and cultural catalyst for downtown Newton and nearby areas (see economic analysis sheet).

9. That plateau of achievement will start with a major fund-raising campaign to acquire the necessary $750,000 presently estimated as needed to bring the Fox back to its full, professional level status as a mainstage live theatre. It is estimated that this campaign will take two to three years to complete in full, however, reconstruction will prioritize those elements of the renovation, e.g. immediate upgrading of the heating and airconditioning system, that when repaired will allow the Fox to begin public presentations year-round and thus gather immediate income through ticket sales, rents, and concessions sales.

Facility Use

The Fox will operate primarily as a live, performing arts facility, presenting a diverse range of entertainment and community involvement centering on plays, dinner theatre, music, dance, celebrity appearances, lectures, educational events, business gatherings, religious services and other special events (see "Programming"). And at a future date, when the performing arts programs have been well established, the theatre will also host special film series.

Programming

To determine the appropriate programming for any theatre, specific markets must be identified from which customers may be drawn. In the Fox's case, four primary markets exist:

1- the immediate area (within a 30 minute drive),

2- the expanded area (within an hour's drive),

3 - the state (within a three hour's drive) and

4- the nation-wide visitor (the tourist, conventioneer and traveling businessperson).

Existing within each of those markets are cultural and racial demographics, e.g., Caucasian, African-American, Hispanic, Native American, Oriental, etc. There are a broad range of economic demographics - low, middle, upper income and affluent. There are lifestyle demographics such as student, married, married with children. And age groupings such as child, teen, young adult, middle age and senior … the sub and cross-groupings of the above are endless.

This means that the Fox, in order to maximize audience development, must program itself in a diverse manner while serving its four primary markets. There are no obvious impediments to the Fox establishing itself as a venue of statewide significance for everything from jazz to rock, comedy to classical music, Christian music to the blues, special film and lecture series, business meetings and religious events, theatrical plays, dinner theatre, and community events – in fact, since it’s rebirth as The Historical Fox Theatre of Newton, Kansas, this has already been proven. The combination of ticket, concession, and souvenir sales has already exceeded $40,000.00

Though every event is different, there are primarily three ways in which a theatre can secure an event. In a rental, an outside promoter pays a flat fee (or flat fee against a gross percentage) to use the theatre for an agreed upon period, during which he presents an act he has contracted to appear. In this case the promoter takes all of the risk by paying all event costs, and then either enjoys the resulting profit or loss from ticket sales. The theatre enjoys a small but guaranteed profit. It cannot lose.

In an in-house promotion, the theatre itself acts as the promoter, by booking the talent, executing the marketing, etc. As the promoter it reaps the benefit of the resulting profit or takes the loss, in this case according to ticket sales plus concession sales and corporate sponsorships. While a far riskier venture, the potential earnings are greater.

In a cooperative promotion, the outside promoter and the theatre share all profits and losses.

A combination of the three processes described above has been shown to be the most responsible path to follow.

Market Position

In determining a historic theatre's position within a competitive market, it must first be recognized as a multi-faceted "product" appealing to multiple demographic interests.

In this light the Fox product can primarily be identified as:

- A 400 seat venue for live entertainment and community events

- An historic tourist attraction

- A meeting facility

- An aggressively programmed and marketed event promoter

- A superior technical production stage house

In our immediate market (within a 30 minute drive of downtown Newton), only one other facility combines these five product identities and successfully exploits them - the Crown-Uptown theatre in Wichita. While other stages, spaces, attractions and promoters do and will continue to exist, there appears to be little chance of any other equally identified competitor coming into play in the foreseeable future. The McPherson Opera House is still under renovation.

The Fox's closest competitors, in accordance with the identifiers above, are Orpheum Performing Arts Center and Crown-Uptown Theatre in Wichita. The distinct advantage our Fox has over these theatres is that of Newton's small town, downtown charm -- with its classic, friendly 19th century Main Street -- and the opportunity for Wichitans to "get-away" to our much more idyllic, historic, and interesting setting.

Networking

The historic theatre industry is different from most in that competing facilities generally make every effort possible to cooperate and respect each other's markets, professional and funding relationships and programming needs. Unlike Pepsi VS. Coke or MacDonald's VS. Burger King, these theatres need their neighboring "grand old movie palaces" to survive, for all are members of an endangered species. As a historic theatre strives to keep the public aware of its unique historical importance and product, promoters aware of their quality services, artists aware of their special ambiance and government aware of their beneficial economic impact, one theatre's success reflects positively upon all. Cooperation wears many faces, whether it be through combined booking power, sharing of funding information, group purchase of supplies or shared technical expertise.

The Fox and the associated venues of the Kansas Historic Theatres Association (KHTA) are fortunate to be located at a central booking crossroad between Dallas, Denver and Kansas City. As most tours are booked first between major markets with secondary markets filled into open dates later, the KHTA's members will work closely to maximize our geographic advantages. This venue network also enhances our ability to secure name acts at more affordable fees. By block-booking with historic theatres "along the trail," performers that we would not otherwise afford to host will make their way to Newton. From the Paramount in Denver to the Folly in Kansas City to the country dance halls of Oklahoma City, Fox management will focus on researching, forging and maintaining these supportive relationships.

Audience Development and Marketing

Unless blessed with limitless financial resources, the only way a historic theatre can survive is if it successfully appeals to every demographic in the market within each performance season. In its first five years of operation the Fox will endeavor to find its most profitable market niches. Through careful audience tracking and cautious trial and error booking, management will be able to focus on those market interests which will best assure consistently strong levels of attendance. We know that music will sell in Newton, but specifically will the blues, rock and roll, country? Is there a market for big band music, gospel, jazz, barbershop, etc.? Will younger audiences support live alternative rock at the Fox? How often? Is there interest in folk music? String Quartets? Contemporary Christian music? Live theatre? Dinner Theatre?

Each genre of live entertainment carries with it an audience of very individual buying patterns. For example, while country audiences are extremely loyal and will buy tickets even though the act hasn't had a hit record in many years, a rock/pop audience is far more fickle, with this year's hot act often becoming next year's has-been. Country, blues and jazz fans will literally drive hours to see a favorite performer while classical fans seldom do, etc., etc. We are all aware that great dinner theatre presentations can last for years and years and make a remarkable direct profit to the venue and a strong indirect profit to nearly all the businesses close by.

Marketing campaigns will precede all major Fox events. According to the type of event and particular audience demographic being targeted, these campaigns will employ a customized mix of print (newspaper), broadcast (radio and cable TV), point-of-purchase (posters, flyers, retail promotions) and direct mail/email.

Audience tracking and response, as the years go by, will allow Fox management to forecast a particular event's chances for success.

Ancillary Revenue

Besides income from theatre operations and retail space rental, the Fox will generate revenue in a number of ways other than ticket sales and grants acquisition.

Concession Sales - The main lobby stand will sell a wide range of snacks and beverages from candy to popcorn to soda, juices and bottled waters. Depending on the event, these items will range from the commonly seen to the more upscale (gourmet, small brand chocolates, etc). Product lines will be chosen in light of profit margin, ease of clean-up, container noise during the performance, speed of handling and audience appeal. Though often overlooked, concession sales can turn a failed night at the box office into a profitable event.

Memberships - Under consideration -- for an annual fee, a maximum of 500 patrons will have continued access to VIP ticket services including early announcement of events, access to tickets prior to sale to the general public, priority seating, invitations to special events….and free popcorn. Such VIP clubs engender a loyal audience core and provide early word of mouth - sometimes selling most of the tickets available to an event before expenditure of marketing funds.

Souvenirs - A growing source of theatre revenue nationwide, the sale of quality gift items create a distinctive public image for the facility. Items such as coffee mugs, postcards, commemorative publications, limited edition posters and Fox t-shirts carry the Fox name beyond our doors and keep the community attuned to our activities.

Theatre Tours - While the most time consuming and least profitable of all revenue sources, regularly scheduled tours of the facility are a common public relations practice. Tours are sometimes given for a small flat fee, but sometimes yield greater reward if the patron is asked beforehand to give what they feel is appropriate.

Corporate Sponsorships - Under consideration: on a rotating basis, major corporations and retailers may be invited to attach their names to the marketing of special events or programming series.

Playbill Advertising - Revenues from display advertising in monthly or quarterly Fox publications and event calendars or on the Fox website.

Property Maintenance

A theatre as rich in history and age as the Fox is inherently fragile and must be monitored for wear, materials failure or customer abuse. While her stage house structure and fixtures will be extremely sturdy by comparison, they will also demand constant monitoring. It will be management's responsibility not just to market and operate the Fox but to protect it, especially in light of the considerable investment made by the community. Care of the property is a vital aspect of public relations, because if the patrons are expected to respect and value the site, they must feel that management does as well.

The history of the Fox demands that it at all times be treated by management with the highest degree of respect. That respect will in turn be reflected in the public's regard for her well being.

Rental Policy

The Fox will build a strong roster of regular event promoters who use the hall on a regular basis, and the care of these promoters will always be a central focus of operations. By recognizing in event negotiations the needs of both sides (the theatre and the promoter), and by structuring rental arrangements that are mutually beneficial, the Fox will strive to serve the tenant in an exemplary and ethical manner, supporting their current and future interests while protecting our own. This ethic is intended to create a long-term relationship with promoters based on trust and shared success, so that in the future, their first choice of venue will be the Fox. This has already been accomplished with several promoters and will continue.

This degree of service will be extended not just to major event promoters but to the smallest of community organizations utilizing the venue. Through reduced rental rates, consultation and assistance on all aspects of event production and cooperative ventures, Fox management will strive to empower up-and-coming producers of all sizes.

While each rental agreement is different and contains dozens of variable details, each will be held up to a set of basic criteria. The Fox will be available for booking as long as the event:

- Does not physically endanger the audience

- Does not endanger the theatre's interior spaces

- Does not blatantly offend community standards

- Does not violate existing local ordinances

- Does not immediately conflict with events scheduled at other local venues

- Does not endanger relations with allied theatres across the state

- Does not endanger our 501(c)3 status as a non-profit charitable enterprise As a non-profit organization utilizing public and private funds from the local community, the Fox must at all times see itself as the citizens' venue and make itself available for maximized use in a consistently responsible manner.

Educational Services

It is the legitimate responsibility of a historic theatre to address the interests of the area's youth, not just to provide cultural reward and stimulate their quest for knowledge, but to help develop a new generation of audiences. Besides being the right thing to do, service to young audiences is prudent business strategy. The experience of witnessing a concert or film in a historic theatre (as opposed to a modern auditorium) is unique and often magical. This experience imprints itself most intensely on the young (remember how important Shopper Shows were to you), and it is the young that will eventually determine the fate of the Fox. A comprehensive program of educational tie-ins will also positively position the Fox in the eyes of potential funding sources whose interest in historic theatres may otherwise be limited. Primary vehicles for interface with local educational departments can be:

- Sponsored discount and free ticket programs

- In-house and classroom Visiting Artist Programs

- In-house performing arts workshops

- Establishment of resident youth dance companies

Many such programs have been established across the country, and application of these models will become an essential aspect of the Fox's programming, funding and development vision.

Final Note

There's more to the Fox than the Fox.

Since its construction in 1914 as a response to the devastation of the Great Fire, the theatre has ALWAYS been a centerpiece of downtown Newton's commercial and cultural success … that was lost - and that injury to the downtown is emblematic of the commercial and cultural damage steadily inflicted on the community in recent decades.

Therefore, we believe and will do all we can to ensure, that the rebirth of the Fox will also be a catalyst for the rebirth and strengthening of downtown Newton and the entire community.

And that is our goal.

The Directors of The Historic Fox Theatre of Newton, Kansas