| Distributors
and Sales Agents
excerpt
from MAKE MONEY MAKING INDIE FILMS: An Independent Filmmaker's
Guide to Obtaining Worldwide Distribution and Raising Private Capital
by Michael Valverde
Just
like in any other industry, there are various sales channels through
which to sell various products. Some independent-film distributors
have theatrical-release capabilities (Lions Gate, Strand, IFC, etc.)
as well as foreign, while others specialize in foreign television
or certain genres such as family, horror, or action/ adventure.
The
key is to know what kinds of films and to which markets a distributor
is successfully supplying. When it comes to making a deal, all of
them will want to control the right to sell to as many markets as
they can, even if they don't work in all the markets, because they
can sell the rights to other sub-distributors who specialize in
those areas. The problem is, most of them don't exploit those opportunities
because it takes some effort, and both distributors end up with
less than their normal return from the deal.
When
negotiating with any distributor you must review their marketing
and sales plan in each market. If they cannot convince you with
proof that they can consummate sales in the domestic television
market, then parse out those rights from the contract and look for
a distributor who specializes in that area. The same goes for all
the different market rights. It will certainly make finding a distributor
more work, but believe me if you sign a deal with a distributor
who does nothing with your film in four out of five markets, you'll
be livid - not to mention trapped in a contract for five to seven
years.
Sales
agents can be a great asset. They are typically people who are connected
in a major way. They stand between you and distributors and take
a percentage for setting you up with a deal. The best ones are able
to increase the sale price of your property enough to more than
offset their fees, but some amount to just another hand in the pot.
It is difficult to know who can help you, so be sure to talk to
several references. If you find the right sales agent, you can reduce
your time to market and simplify the whole distribution process.
A Word
about Cost
We will discuss the distribution contract
in detail later, but distribution fees vary, typically ranging from
20-40%. Sales agents' fees also vary, but typically range from 5-15%
-- but remember, EVERYTHING IS NEGOTIABLE!
Finding
a Distributor
Knowing which distributor is right for your
film is step one. Even before you start your investment plan to
raise the money to make your film you should research your distribution
options, because if your film does not reach its target audience
there is no chance for success (make it your mantra, too).
Before
you dive in, it is important to realize that film distributors count
on people like you to make films for their survival. THEY NEED US
TO KEEP MAKING FILMS! Not even the major studios can create enough
products to fill their release slates, much less a smaller indie
distributor. The trick is to find the right one for your product.
In the hands of the right distributor and/or sales agent, your film's
value is exponentially increased; the converse is also true.
Where
to Look
Use the power of the Internet to
locate your distribution partner. Visit www.afma.com
or pick up a copy of the Hollywood Creative Directory for a list
of independent film distributors. Many of them will provide links
to their own web pages that list their current release slate. Review
the films listed and see if you can find films from the same genre
with a similar tone or target audience as yours (If you have some
indie favorites that compare to your film, read the box art or credits
and track down the distributor).
A word
about comparable films
This is not an artistic or story
comparison. It's more about how the film is packaged and marketed.
If you cannot find anything similar in genre, tone or presentation,
then your script is not appropriate for this approach. Not every
movie fits.
When
you find a distributor with a few comparable titles; look up the
independent producers of those films and contact them. Explain that
you are going to make a film and considering approaching their distributor.
Ask the producer how the distributor has performed for them. Be
careful not to present your film as a competitive product to theirs
and be careful when pressing for sales figures. Simply ask them
to relate their experience with the distributor. If you shut up
and listen, they will often tell you a lot more than you would dare
to ask.
Provided
you get positive feedback and intend to use the distributor, you
can also use this information to great advantage. Especially, when
you call and say that one of their current producers "referred"
you, it should at least get you through the front door.
Talking
with Distributors
Your posture with the distributor
is one of partnership. You are planning to produce a film and are
looking for a distribution partner to hold your hand through the
process. Tell them that you have optioned what you believe is a
solid script but want to verify its marketability before you go
any further. Explain that you also consider their guidance on casting
and production issues critical as you forge ahead. Be prepared to
pitch the material with a short concise synopsis. When appropriate,
borrow words and or phrases from the synopses of the pictures on
their slate, but don't be too obvious. This will help them see that
you and your picture are a fit for them.
If
all goes well, they will request a copy of the script, or at least
a written synopsis. Ask them for an appropriate time to follow up,
and then do so. It may take a month or more for you to get feedback
but be patient and call back when they tell you to and not before.
Many distributors use outside readers and/or script analysts who
can get backed up. If they get a positive review from their reader,
they will typically read it themselves before calling you. If they
get a negative review, they will typically pass along a few comments
and/or suggestions for changes.
Check
your Feelings at the Door
Your response to a distributor's
criticism of your script will be a major deciding factor in whether
they continue to work with you. Don't be defensive; ask for as much
input as they will give. Ask for a copy of the coverage, though
they may not give it to you. Unless they just don't get your script's
creative direction, let them know that you plan to implement their
advice (even if you can only see the merit in some of it). Tell
them you will get them an updated version as soon as you can, but
be realistic on the timeline (It usually takes 8-10 weeks to complete
a solid rewrite). A rushed rewrite that's not ready will only undermine
all of your efforts.
I
recommend following this path with three or four distributors simultaneously,
conserving time. You are not committed to any of them until you
get to the next phase. If one doesn't get your material or you feel
they're not right for you, move on to the next.
So They
Like It - What Now?
A distributor has warmed to your script --
whether draft six or eight, they can see their way clear to take
it to market if you make it according to their recommendations.
That usually means casting the actors they approve and following
their lead on the marketing materials. You haven't even raised the
money to make the movie yet -- in fact, you don't even have a solid
budget -- but you have a path to the market and some of the critical
figures for your value equation.
By
starting with the end in mind you have already mitigated the financial
risks for your investors and created some boundaries inside which
you can be wildly creative - not to mention the added peace of mind
in knowing an industry expert now supports your project. Your script
is becoming a product.
A word
about co-productions
Some distributors may offer to get more involved
in your film at this stage. They may suggest a formal partnership
that can take on many forms. Your film's budget range is typically
the deciding factor on whether this kind of arrangement is best
for you. If you have access to the budget, then by all means do
it yourself. If not, consider the distributor's offer very carefully
and be sure to have an entertainment attorney with direct experience
with co-production deals represent you in the negotiations. (If
your current counsel does not, ask them to work with someone who
does). Remember, your goal is to maximize your profits without sabotaging
the film.
Regardless
of whether you opt for a co-production or not, ask one of your distributor's
key personnel if you can list them as a member of your Advisory
Team in your business/investment plans. Also ask them for a "Letter
of Interest" to include in your plan. They are accustomed to
providing these, so it shouldn't be a big deal. We'll talk about
the specific elements to include in this section of your investment
offering later.
Budget
Suggestion
A word about your budget: It is always best
to spend as little as possible without compromising production values.
Simply put, the less you spend, the more you make. Your new distribution
partner is going to suggest certain cast elements that they believe
will sufficiently increase the value of your film. Your job is to
acquire their acting services for the best possible price. Casting
directors have access to information about actors' standard rates.
Find a casting director who likes your project and use them to determine
whom you can afford. Once you've narrowed your focus and you're
ready to make offers, have your entertainment attorney contact the
actors' agent to determine their interest and negotiate the deal.
Don't
fall into the trap of thinking you have to attach actors before
you go out to investors. Though it is often helpful, it is not necessary
to take the financial risk. If you can manage to garner solid interest
from actors without making a pay-or-play deal (this means they get
paid whether you get funded or not), then by all means get a letter
of interest or even a -- pinch me, I'm dreaming -- letter of intent.
Your goal is to be able to confidently tell investors that you have
certain name talent ready to do the film if they put up the money.
A word
of caution
Investors value trust and honest communication
very highly. If they feel as though you've spun a yarn, they will
remove their support faster than a dress on prom night. You MUST
NOT represent that you have commitments from people if you don't.
Don't forget investors want to be part of the team. They, like you,
enjoy solving problems -- that's probably at least part of the reason
they're wealthy enough to invest, so get them involved in finding
solutions. Keeping all of the proverbial balls in the air is what
makes getting an independent film made such a feat.
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