Guesstimate 3

Estimate the annual revenue of a multiplex

Interviewee Notes Case Facts and calculations

• Only cover the most
substantial revenue streams Average daily revenue/screen Revenue streams
• The footfall will depend on 1. Ticket Sales Revenue per day= (Average
whether it is a weekday or footfall per day)*(Average price per show)*(No of
weekend shows/day)
• Price can also be considered =200*250*4=Rs 2,00,000 Ticket sales Parking Food & Beverage Advertising
different for weekday and 2. Revenue from parking per week:
weekend, here although (Average footfall per show)*(% people using
parking)*No of shows/day)*
Average Digital
average price has been (Average ticket size)
Average Billboards
footfall price per No of Ads
taken 200*0.5*4*50=Rs 20,000
per show show shows/day
• Assume that the revenue
from advertising primarily 3. Advertising Revenue= Assuming it is 10%
comes from billboards and of the total revenue
4. Food & Beverage= (Average footfall per Weekdays Weekend (Fri-
digital ads between movies. (Mon-Thur) Sun)
show)*(% people buying)*No of shows/day)*
• This is average revenue per (Average ticket size)
screen, can be multiplied by 200*0.5*4*150=Rs 60,000
number of screens to obtain Weekdays Weekends
revenue of multiplex Average daily revenue/screen =Rs 4.2lac
Seating Capacity 300 300
Total Revenue = Average daily Average
60% 75%
revenue/screen*No of screens*No of days occupancy rate
=4.2*4*300 = 5040 lacs =50.4 Cr Average footfall 180 225
(Taking into account some days when the footfall
will be extremely low) Average footfall per day = (180*4+225*3)/7~200

Interview Summary
This is a guestimate case where the interviewee should quickly identify the most important revenue streams before laying down a structure and solving the case

Observations/Tips/Suggestions
• Should first create structure, then put numbers to it
• Make reasonable assumptions, clarify with interviewers at each stage
• Be prepared to justify your assumptions at each stage

(C) Consult Club, IIM Ahmedabad 2018-19 101