Independent Local Business Vies for Movie Rentals with Corporate Giant Redbox

NORTH VANCOUVER, BC, October 31, 2012 (Press-News.org) Movie rental kiosks are filling the vacuum left behind by the closure of Blockbuster and other video stores in Lethbridge, Alberta.

The U.S. corporate giant Redbox is riding the wave of its tremendous U.S. success north into Canada. It has said it plans to launch as many as 2,500 kiosks in Canada by the end of 2013 and recently announced new partnerships with Shoppers Drug Mark and Loblaw Companies, which owns the Wholesale Club and Real Canadian Superstore in Lethbridge.

And then there's Coaldale resident Kirk Allison with his independent company called U Do It DVD Enterprises.

"We used to have the Movie Gallery, Blockbuster, and Rogers. They're all gone now," says Allison, who started his movie kiosk business in 2009 and has grown to four kiosks.

"I saw how well Redbox was doing in the States and thought there was an opportunity," he says, adding that he chose this business because the self-serve kiosks gave him free time to spend with his kids who were then 10 and 13. "I had a revelation in my life. Work is important but it's not number 1. My personal life is what really matters."

When Allison first started, business was a challenge because Lethbridge had never had DVD rental kiosks and people didn't know what to make of it. But he worked hard to win them over and gained a following.

Now Allison and Redbox are neck and neck in Lethbridge with three kiosks a piece. Allison has kiosks at Lethbridge College, the University of Lethbridge, and the Gas King convenience store in Southview on 16th Avenue. Redbox Canada has kiosks in Safeway stores in the neighbourhoods of Heritage Heights, Park Meadows and Fairmont.

Allison has another kiosk just outside Lethbridge in Coaldale at the Esso Stop N Go.

For Redbox and DVDNow customers like Allison, the closing of video stores has been good for business. Allison says he expects to add two kiosks by the end of the year.

In the U.S., Redbox is nearly everywhere with 38,500 kiosks. Redbox's parent company Coinstar (CSTR) was number 15 on this year's Fortune Magazine's 100 Fastest-Growing Companies List. The movie rental business has also been the driving force of Coinstar's profitability, with Redbox revenue surging 18 percent to $460 million in the third quarter of this year, compared to the same quarter of the previous year.

"Many people were disappointed when the video stores closed," says Scott McInnes, the CEO and Founder of DVDNow Kiosks, the company that supplies Allison with his machines. "Imagine if you'd invested in a high-quality home entertainment system with Blu-ray and large LCD or plasma TVs. You want to watch movies that take full advantage of your system and video streaming just doesn't compare."

A Redbox study done in January 2012 found that nearly half of Canadians rented a movie from a video store in the last half of 2011, while more than a quarter of Canadians were binge movie watchers, renting six to 10 movies over the last three months of the year in stores or online.
The Independent vs. Redbox

They're both red, and they both rent movies at convenient locations for less than $2. But due to Redbox's licensing agreements, Allison has access to major new release movies up to 28 days earlier from Warner Bros., Fox and Universal.

Allison acquires his machines from DVDNow Kiosks, a company based in North Vancouver that provides movie rental kiosks as a business opportunity to aspiring entrepreneurs.

The DVDNow kiosks are designed so owners like Allison can sell advertising on the kiosks, an opportunity that Allison takes full advantage of. Another advantage is that they are able to display movies in their original packaging.

But the best advantages for Allison come from the lifestyle his self-serve kiosk business provides. Before he started his DVDNow business, he worked in sales for Sysco Food Services spending long hours on the road, far away from his wife and two kids. Prior to that, he'd owned a fitness club for 10 years, which meant he worked most of the time.

Kirk's business can be managed remotely using DVDNow's Web-based software, so the time commitment is minimal. "I've really had a lot of flexibility to make time for myself and my two kids in the last few years."

DVDNow launched in June of 2006 and quickly became the leading provider of independently operated DVD rental kiosks. Today, with operations in over 16 countries, DVDNow has the largest independently operated DVD rental kiosk network in the world and is based in North Vancouver, BC.

Website: http://www.dvdnowkiosks.com