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TOPIC: Question on Film Rent Payments

Question on Film Rent Payments 22 Nov 2009 11:04 #32848

  • BWT
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With respect to film rent, is there any sort of pre-payment required on a per-film basis with studios?

(e.g. 'if you want Movie X, you will need to pay the studio distributing it Y% of its projected box as a deposit before you get the print)

Or do exhibitors normally cut a weekly check to the studios depending on how well a film has done at the end of its first/second/third week of release?

I'm trying to model my monthly cash flows and I wanted to make sure I'm getting all of the monthly outflows correct.

Thanks in advance for any help!
Last Edit: 22 Nov 2009 11:04 by BWT.
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Re:Question on Film Rent Payments 22 Nov 2009 11:21 #32849

  • rodeojack
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If you're a new operation, many studios will charge you an advance before you get your print. This is frequently based on a percentage of what they think you'll make in your first week or two.

An "advance" is an up-front charge, which will ultimately be applied against your actual gross income. If your percentage is more, you'll make up the difference. If it's less, you'll be credited toward your next film from that company. This works itself out on a weekly basis, so your cash flow projections are fairly easy to work out.

Once you've established a positive business history with the studios, they'll stop charging you the up-front payments. Then, it's up to you to maintain that relationship by paying promptly with checks that always clear the bank!

Regarding your question about which week your payments go toward: Generally, your checks will be covering the grosses you made 2 or 3 weeks back. The studios appreciate you holding onto their money for them, but they'd just as soon see you hand it over as soon as possible... starving actors & all! :woohoo:
Last Edit: 22 Nov 2009 11:27 by rodeojack.
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Re:Question on Film Rent Payments 22 Nov 2009 20:09 #32850

  • leeler
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don't know if this is overkill or not but I pay on Monday for the movie that ended on the previous Thursday every time.
"What a crazy business"
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Re:Question on Film Rent Payments 23 Nov 2009 09:46 #32853

  • dsschoenborn
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Some studio's may ask for a guarantee in advance too. That money you don't get back even if it more than the % you thought you would have to pay. Also you can play a movie and pay the up front terms but it can settle at higher terms at the end of its theatrical run. That means you can get hit with another % to pay several months later if you opened on the break and only kept the picture for 3 or 4 weeks.
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