Welcome to Spling Movies

Welcome to Spling Movies

Custom Search
Banner
Banner
Ster-Kinekor Enters into Business Rescue


Ster-Kinekor holds the largest market share of any exhibitor in South Africa and has been in operation for over 50 years. Having survived the introduction of television to our country in 1976, they've been able to stave off changes in media consumption made possible through the Internet. Using their big screens and advances in cinema technology to stay a step ahead of the convenience of home entertainment theatres, they've managed to stay relevant to audiences. While streaming services have undercut them by way of cost and convenience, they've converted their offering to include VIP and technology-driven experiences at a higher ticket price.

Part of their success has been the cinema chain's clinical business approach to screening movies for the public. Slick, exciting and checking all the boxes for a typical movie night, their audiences have simply been numbers. While this may be good for business, it doesn't demonstrate an on-the-ground approach to customer service. The concept of movie-going is now seen as occasional rather than regular, downplaying its focus across media outlets. While escapist blockbuster franchises have spurred box office takings, attendance has been steadily dropping due to high prices and in-theatre niggles.

The Covid-19 pandemic has devastated many industries, including movie theatres, and it's amazing they've managed to survive almost a year given the drastic limitations of the new health and safety protocols. Major new releases have been delayed to the point that they're even at risk of a tepid response when they eventually land after months of ongoing coverage. The climate is uncertain and studios are holding back, making it incredibly challenging to anticipate what lies over the horizon.

For Ster-Kinekor going into business rescue is sensible if not a last resort. It's a chance to weather the next few months while still operating, giving them some breathing room to take stock and tackle the next few months ahead. Their strategy has basically been wait-and-see, which probably made sense in the first few weeks of the global response, considering previous viral fall out. Possibly taking cues from the roll out of forthcoming attractions, the capacity restrictions and hesitation from audiences has made them financially distressed and in need of business rescue mediation.

The cinema chain has tried some diversification by backing a drive-in format and introducing a subscription club but inaction, global trends and government regulation have left them in a stalemate. Not having a strong emotional connection with audiences, rolling with entertainment trends, attending to in-theatre disturbances or acknowledging the threat of disruptors could cost them dearly. It's not just Ster-Kinekor, one of the more successful commercial enterprises, it's the story of old school cinemas across the planet. Let's hope that enough loyal patrons can step up to help save the iconic Ster-Kinekor brand and other movie theatres, who are also struggling to keep their doors open. Perhaps this much-needed shake up will enable them to deconstruct their business and re-engineer it to last for the next 50 years.