Allan Reagan didn’t set out to be an exhibitor. The Texas-based entrepreneur was simply looking for an anchor tenant for his shopping center in Round Rock, Texas. The space, a former grocery store, was a perfect fit for a dine-in cinema, a concept Regan believed would be an ideal catalyst for foot traffic. But when the deal he was expecting didn’t come through, he took matters into his own hands. Already having a background in retail and hospitality, Reagan began putting the initial pieces together to launch an original new brand in the increasingly competitive dine-in cinema space. The challenge wasn’t only launching his own cinema, but doing so in a way that would set it apart from industry titans like Alamo Drafthouse and Studio Movie Grill that also call Texas their home. Reagan found his answer in an unlikely place: a bankruptcy auction. It was there that he purchased some brewing equipment, still stored in its shipping container. While he didn’t have any plans for it at first, he thought he might use it as a showpiece to decorate his new cinema.
But then he reconsidered—if it was operational, why not put it to good use? The first location of the microbrewery dine-in cinema concept, a six-screen complex, opened in that very shopping center, in that same former grocery store, in 2011. It might not have started with a radioactive spider, but it is essentially the origin story that has since become Flix Brewhouse corporate lore.
Reagan knew that in order for the concept to stand out in the competitive dine-in environment, the food and beverage component—particularly alcohol service—would have to exceed customer expectations. Flix therefore sought to curate its beer selection as selectively as its programming, including hiring brew masters who could expertly craft their own unique selection of signature beers. Every Flix location is equipped with a seven-barrel brewery on its premises. That means each location brews close to a thousand barrels each year, around two thousand kegs of beer for each site. For customers looking for something different, Flix also features an additional 30 guest taps from carefully curated craft breweries.
As business picked up at the new cinema, Reagan decided to take the show on the road and hired Matt Silvers (SVP of real estate and brand development) in the summer of 2012 to scout potential sites for expansion. With Texas pretty much saturated in terms of cinema dining, Flix began looking at options where cinema dining had yet to find a strong foothold. That’s how the Midwest emerged as a natural destination. “I don’t know if this still holds true—I think it does—but there are more dine-in cinemas in Texas than all of the other 49 states combined. So we asked ourselves, are we ready to slug it out with some of our friends that we are in competition with on the dine-in side, or are there other opportunities elsewhere?” says Flix Brewhouse’s director of marketing Greg Johnson. “Yeah, you’re going to have different challenges being remote, but you can also reeducate that market in what you believe dine-in cinema should be like.”
The momentum to expand came to an abrupt stop, however, when the circuit experienced its first major setback in the summer of 2013, with the unexpected passing of Walt Powell, its VP of operations. Powell had played an instrumental role in developing and launching Flix, and his untimely death at age 33 reverberated across the fledgling company. Today, a portrait of Powell hangs at every Flix Brewhouse location in the country, memorializing him and his contributions to the theater chain.
Flix now found itself having to fill a crucial vacancy during a transformative period in its early history. The circuit named Matthew Baizer as its senior vice president of operations and chief operating officer later that summer. “That really changed what Flix would eventually become,” says Johnson. “He is a restauranteur. Matthew has a really deep strength in technology as well as execution of service models.”
The Flix service model, according to Johnson, centers on speed and accuracy. “Those two components are the make-or-break of this business. Even though you might get a little bit of a grace period over traditional restaurants; you have something on the screen to pacify you while you’re waiting for your food or drink, the speed in which you can get an order out of the kitchen and in somebody’s hands is a really important thing,” he says. “The speed of drink service isn’t just because you can then serve another drink, but about people’s expectation. The faster you can get something out, the more delighted they will be. And then of course, accuracy. You’re in a dark auditorium. It’s really easy for something to get dropped off at the wrong place. It’s not just even at the wrong table, but if you’re there with your spouse and the orders are switched when you get them—these details make a big difference.”
To accomplish that level of service, Flix equips all its servers with tablets to allow them to input orders digitally in front of the customer instead of having to run to a point of sale afterward. For that to be feasible, however, each Flix location requires a significant upgrade in Wi-Fi access points throughout a complex—with a level of bandwidth that can keep up with demand.
As anyone who’s had a bad cinema-dining experience can attest, the margin for error should be small. Feeding an entire auditorium within a 90-minute window is difficult enough; doing so simultaneously for an entire multiplex, in the dark, is daunting. Any sort of delay in an order will have the patron focus on the food that hasn’t arrived instead of the film that’s on the screen. “One of the challenges of dine-in is that cinema is always supposed to be immersive,” says Johnson. “You’re supposed to shut off the outside world and become a part of the story on-screen. Inherently having service in an auditorium can be a detractor from that, if it’s not done right. You have to figure out how to solve this conundrum of serving your guests without pulling them out of that story. If you pull them out, you’ve lost.”
Another big point of emphasis for the circuit, particularly in its new builds, is theater design. “Retrofitting is a beast,” admits Johnson, who says Flix has learned a lot from its experience in its first location. “Every step your team members have to take, that’s labor money that’s going to cost you. It doesn’t sound like a lot, but it adds up when you’re doing ten thousand admits on a weekend. It’s one or two more people that you have to clock in just to be able to serve. Those weird walking-distance issues are things you never would’ve thought of, until all of a sudden you get into the weeds on a Saturday night and start wondering, Why is Billy taking so long to get back from theater nine?” New Flix locations are designed like skyscrapers, with a functional core (the kitchen) and auditoriums filling each outside edge. Every auditorium is equidistant from the kitchen, streamlining service across the complex.
The second Flix location opened in Des Moines, Iowa, in the winter of 2014. The company’s leadership identified the market as underserved when it came to dine-in cinema, and moved to stake a claim by making an impact with the community. “If you can deliver on a good experience, people will go,” says Johnson. “When somebody else enters the market, they’re always going to be compared against you. You’re the local one that was there first, you’re their theater, you become their de facto expectation—but only if you do it well. If you ask how dine-in is done to someone in Des Moines, I’m confident they would describe our approach to the concept,” he says. Today, the circuit operates 7 locations with 5 more under construction. There are plans for further expansion, with a target of growing the chain from 15 to 18 locations in the short term.
Flix isn’t alone in expanding the footprint of dine-in cinema across the United States. While saturation is a concern in certain markets, the circuit doesn’t see the competitive atmosphere as a threat to its model. It isn’t odd to see two restaurants or bars across the street from one another, as long as their concepts sufficiently differ. Johnson calls it a friendly competition among circuits specializing in cinema dining. “We have some very specific challenges facing us within the overall cinema industry, and we like to band together to push the whole idea forward for the betterment of the moviegoing community,” he says. “At the same time, we’re all fighting for mind and market share. It’s a lot of fun and we have a hell of a lot of respect for our cinema dining brethren. We’re one of the newcomers. We haven’t been doing this as long as some of these guys. It’s an exciting time to be in this business.”