LUFKIN, Texas -- Brookshire Bros.' 49-cent-a-night rental program is drawing traffic in its video departments, SN found in a store visit. Traffic was heavy in a Humble, Texas, department, even though it was mid-afternoon Thursday. The offer, which applies to all rental titles, was well promoted with in-store signs.
While the low-ball pricing has not yet had an effect on other Houston retailers, it is a development the industry is watching carefully.
Distribution sources report that Brookshire's 49-cent program, and a similar program operated by Furr's, Albuquerque, N.M., are doing well in terms of store traffic and profitability. Furr's has been pricing its videos for 49 cents for three years, while Brookshire Bros. started last year. When contacted, an executive at Brookshire would not comment on the program. Traffic in the Brookshire department was about four times that of other Houston video departments. Retailers offering this type of pricing would have to quadruple the volume they would do operating a traditional program, said industry observers. Total inventory in the 1,000-square-foot live department was about 3,500 units. Despite the low pricing, Brookshire does not skimp on new release depth of copy. New movies were about 34% of the rental inventory in store.
For example, the store carried 12 copies of "Waterworld," "Die Hard With a Vengeance," 10 copies of "French Kiss" and eight copies of "Something to Talk About."
Retailers offering such low prices on new releases cannot acquire tapes from shared transaction fee programs like Supercomm, Dallas, and Rentrak Corp., Portland, Ore., because those companies have minimum per-rental charges.