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Let’s Talk Money

Selling a Theater as a Complete Room Can Help Ease Sticker Shock “How much will this home theater cost, and what is included in this price?”

Selling a Theater as a Complete Room Can Help Ease Sticker Shock

“How much will this home theater cost, and what is included in this price?”

Anthony Grimani ([email protected]) is president of Performance Media Industries, with offices in Novato and San Anselmo, California.

These questions sound familiar, right? I deal with them every day, even though, in my work, we don’t handle the construction, equipment sales, integration, or programming. Fortunately, an approach that I have been using seems to work very well for answering the “price” question without triggering sticker shock.

It’s More Than Just the Gear
A home theater is not just equipment, the same way that a live theater isn’t just a stage and a movie theater isn’t just a projector and a screen. They are entire rooms that include walls, décor, seats, and of course equipment. By the same token, a home theater is a complete package of a room plus its equipment and should be represented as such to your clients. Get away from talking about just the gear, or just the install, or just the programming. Instead, talk to them like all the other contractors are talking; talk about complete solutions.

So just how do you figure out the complete solution, given that you aren’t the contractor that is building out the sound-isolated, noise-controlled, acoustically tuned shell for all your lovely gear? I can just hear a bunch of ESCs grumbling about taking on any discussions related to price tags that are outside their control. Fortunately, there’s a logical way to think about this dilemma.

Crunching the Numbers
Your client is paying a certain price per square foot for finished construction of his home, and an even higher one for fully furnished spaces. In California, for instance, furnished luxury footage easily reaches up above $1,250 per square foot. That means that a 30×20 great room is going to cost your customer around $750,000, and all they get for that is painted walls with some artwork, seating, coffee tables, and couches. Couches and dining room tables can cost upwards of $10,000, and drapes can fetch $5,000. Those prices would be for nice furniture, but you’re still talking about inanimate objects.

While $300,000 of equipment for a big screen with speakers might seem expensive to most clients, paying $750,000 for the entire experience space is fully acceptable in luxury residential environments like this CEDIA Electronic Lifestyles Award-winning theater from Vancouver’s La Scala.

The 30×20 theater in the basement of this same house should cost at least $750,000. If it’s less than that, then it’s out of step with the rest of the house’s quality.

So, start with a bare slab, add $750,000 in construction, gear, integration, and programming, and there you go. You have a high-quality, interactive, action-packed, entertainment environment that you can use any time in full privacy and security.

If you break down that $750,000, then you can usually count on about $450,000 in construction, with the remaining $300,000 for installed gear. Today, that’s a decent equipment budget that will allow you to put up a bright, 14-foot-wide picture with clean and loud 7.1-channel sound.

What Your Clients Get for Their Money
The $450,000 construction budget that you’ve just calculated goes to building reasonably sound isolated walls, a floating ceiling and floor system, a set of risers, a stretched fabric wall scheme, electrical, HVAC, painting, etc. Your $300,000 equipment budget covers a rack of source, switching, and processing gear, power amplifiers, the speaker system, the projector, the screen, the acoustical treatments, the theater seats, and the control system, along with installation, wiring, and programming of all the above.

Look at pricing of a home theater as the room’s square footage multiplied by the estimated per-foot furnished price of the residence. Once you get away from talking myopically about how much each piece of equipment costs, and instead start relating the room budget to match the balance of the home’s lifestyle price tag, your client will see the expense in a whole new light.

Face it, $300,000 of equipment for a big screen with speakers would seem crazy expensive to just about anyone out there, no matter what their monthly take-home is. On the other hand, $750,000 for the entire experience space is fully acceptable in luxury residential environments.