I assume they have to pay loyalties, probably 25 cents or something. Blockbuster has One-monthly pass for $30 by which you can rent as many DVDs as you can. How can they make money?? Does anyone know in renting business??
Answers:
It's royalties, not loyalties. Each contract is negotiated separately. They make money because of the volume they deal in. Say they pay $20.00 for a DVD (because they purchased thousands of them) and $2.00 of that went to royalties. Now, they are going to rent that video hundreds of times, say it costs them $1.00 with overhead, store fronts, salaries, and the like.
That is how they make money.
No they don't pay anything after they buy the dvd but they buy so many that they only pay about $5.00 per DVD.
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