Cost Savings Vs. Cost Shifting

An alternate poster for "Found In Time"

An unrelated alternate poster image for "Found In Time"

Sometimes you’re saving money, and sometimes you’re just moving the costs around. How do you tell the difference?

You’ve gone through the budgeting process and delivered a draft that’s over what the producer wants to bring the film in for. So you trim the fat first (an extra shoot day), then some of the muscle (smaller crew), and still you think there are some places to cut. But before you do that, think about whether you’re actually saving money, or just moving the costs somewhere else. Here are some specific examples.

If you can shoot the film in one less day, you’ll obviously save on everyone’s salary, plus equipment and location fees. However, you run the risk of going into overtime on at least one of your remaining days. Plus, you may have turnaround issues – you’ll have to push the call later the next day. I line produced a film a few years ago where the producer insisted on a fifteen-day schedule. The best-case schedule called for eighteen days. After talking with the director and DP about how they wanted to shoot the film, I told the producer that we would end up paying for the lost three days in overtime, but with worse results (since the actors and crew would not be performing at their peak after twelve hours). Lo and behold, when doing the final costs, the overtime (and extra location fees) came out to just one thousand less than if we’d simply had more days. Wow, we saved $1000, but we came out with a worse film.

On a shoot with three PAs who are each getting $100/day, the “Set PA” line item for an 18-day shoot will run about $8000, including pickup/return days (plus fringes, if you’re paying them). The producer will then ask, “why are we paying so much for PAs?” Firstly, free PAs are hard working but they can make mistakes, because they’re inexperienced, overeager, and haven’t slept. Secondly, they will grab paying jobs when they can so I’ll spend an inordinate amount of time finding replacements. If you’re making a $50,000 film, you may not have a choice. I didn’t when I made “Found In Time,” and I got very lucky with my PAs. But if you have any kind of budget above $50K, try to find a few bucks to pay at least one key PA.

If your plan is to pick up and drop off your gear every day, you’re either (a) insane or (b) shooting a documentary with no lights. As I’ve ranted in previous blog entries, your equipment will always take up more space than you think. Get a van or a truck and pay for parking.

The idea here is that you call the hair stylists, makeup artists, and cast in early so they can start working. This way the rest of the crew isn’t waiting around for the cast to get ready. A lot of producers are reluctant to do this because your cast and HMU folks may accrue meal penalties and overtime because they started earlier. Sometimes they’re right – having people start fifteen minutes or even 1/2-hour early isn’t going to make enough difference to justify the costs. But if you have all the cast members scheduled for the day, or have a scene with a lot of women in it, having a 1/2-hour or 1-hour precall can keep the rest of the crew from going into overtime.

One can go on and on, but the point is that you need to think through the process of budgeting, so you can be sure that you’re actually saving money rather than shifting costs around – or worse, creating the potential for unaccounted-for-costs.

A Good Preproduction Checklist

I realize I haven’t been blogging very much lately. The truth is that the actual work of putting the film together swallowed me up for a bit, which left precious little time left over for reflecting and writing on what I was doing.

June was a very busy month. A few of the things on the to-do list:

  • Two Location Scouts
  • Filing the Tax Incentive applications with the City and State of NY
  • Filing the Screen Actors’ Guild paperwork
  • Doing a new breakdown and schedule for the film
  • Calling locations and soundstages
  • Bidding on insurance
  • Prop shopping
  • Hiring the casting director and preparing for casting
  • Further script analysis
  • Setting up company credit cards, and the Quickbooks/filing system for the film

I’ve also been trying to study other low-budget fantasy films such as the recent Ink, The Science of Sleep, Cold Souls and Gabbeh (if you haven’t seen these, I recommend them all highly). Gabbeh, in particular, fascinates me. Without any kind of special effects, it manages to utterly convince you of the authenticity of the magical world it creates.

Anyway, one of the overriding lessons of June is the importance of being organized. There are many preproduction checklists out there. But most assume a very idealized schedule and that you’ll have a team of people working for you. Here I’m trying to condense it into a list that’s manageable and more realistic for the folks who are producing films literally on their own or with one or two other people. As such it’s organized more or less in priority order (of course, film preproduction is nonlinear and fluid).

Anything that involves should be taken care of as soon as you have a date set. This includes creating your production company, putting the legal paperwork together for your investors and partners, setting up your bank account and credit cards, getting a resale certificate, etc. This is time-consuming stuff and involves government entities, which move on a slow timetable. So don’t put it off.

You can never do too much of this. As a crew member, I used to hate it when the director seemed like the least prepared person on set. There’s a difference between being “fresh” (not getting sick of the material before walking on set) and being unprepared. Properly analyzing your script will never make you sick of the material, only lead you to a deeper understanding of the story you’re trying to tell. It will also give you the materials you’ll need to help you communicate with the cast and crew.

In my mind, script analysis includes the following:

  • Preparing a character breakdown for the casting director
  • Taking general notes
  • Looking at the script from the characters’/actors’ POV (see Judith Weston’s books on this)
  • Storyboarding
  • Shotlisting
  • Preparing a “vision statement” that uses other films, stills, artworks, music… anything that someone can grab and watch/listen to/read to get a sense of what you want to accomplish
  • Figuring out what sides you want to use for auditions
  • Rewriting the script based on the above

This should be happening throughout the preproduction process. It becomes harder to do as preproduction goes on, since it demands stretches of uninterrupted time. So start this as soon as you have a draft that you think could be shot. I also recommend “saving” everyone (including yourself) huge headaches by refraining from publishing new drafts until you’ve “ganged up” a few significant changes. Publishing new pages every couple of days is not going to endear you to anyone. On a really low budget film, you are GUARANTEED to get out of sync (with actors, crew, director and producer all showing up on set with different drafts).

This broad category includes breaking down the script, scheduling it, and budgeting it. This should start as soon as you have a workable draft and will (for better or worse) be an ongoing process. You should try to generate a budget, a location breakdown, and a cast list as soon as possible. I’ve written about this before, so I won’t go into too many details here.

Try to nail your locations, or at least start exploring possibilities, as soon as possible. I’ve written extensively on location scouting considerations, so I won’t go into it here. I want to add two things: be prepared to bribe people to turn off their radios, park somewhere else, etc. And have a backup plan. You don’t want to lose a day of shooting if a location gets scotched.

Use the best aspects of a location – even if it means bending the story a little bit. I once worked on a film where we had to find a country house for a corporate law firm partner. We found a beautiful, “rich-looking” house with two giant floor-to-ceiling, two story windows. But the scene was set at night, and we were shooting during the day. The DP and director wouldn’t budge, so we gelled the windows (which took forever), and shot away from them – blocking everything in front of an interesting but rather “non-opulent” wall. The issue of wealth (important to the characters and the film as a whole) was lost.

You should start thinking about this as soon as the script is done. Do you know a “name” actor (and I mean know in the sense of actually having met, talked, worked with, and NOT in the sense of having lots of posters of him/her in your room or that you’ve stalked them or followed them on “E”)? Do you know good “non-name” actors? Do you know a casting director?

The casting process is in many ways the hinge that the rest of the film swings on. If you cast well then many of your headaches will disappear on set (to be replaced by others, of course). Cast badly and you’ll be wasting a lot of money and time. Note that casting well doesn’t necessarily mean casting a name, or even someone with a lot of experience. But:

  • Do they bring the role to life?
  • Do they think of things you haven’t thought of?
  • Are they committed to the sometimes arduous nature of the process (they refuse to coast on indication and cliche)
  • Do they have chemistry with each other?
  • Will they show up on time?
  • Do they understand the hours and time commitment, or will you have to compete with their day jobs or significant others?

These last two sound funny, but they’re not. I’ve worked (as a production manager) with musicians cast as actors. They tend to be very good, but many don’t understand the concept of a seven-AM call time.

I’ve also worked with actors who told me on the day that they had to get to their catering jobs two hours before we were scheduled to wrap. My sympathy is limited – I’ve passed up day job money, sleep, sex, a few friendships, and a vacation or two to stay in this business. If you can’t walk the walk, don’t talk the talk.

On the other hand, if you’re working with an actor who’s got another ACTING commitment, then you have to respect that commitment and work around it. If you can’t, don’t cast that person, or wait until their commitment is over before you shoot.

Also, if your dates aren’t solid (they won’t slip by more than a few days), you can’t expect any actor, no matter their level of experience, to wait around for you.

Crewing up is both difficult and easy at the same time. It isn’t hard to find people who want to crew on films. The problem is finding people who are willing (see above) to stick with it during some tough times, and/or are also willing to take a pay cut to work on an indie film. Also, since everyone is a freelancer, you can’t ask someone in May what they’re schedule is going to be like in December. Unless the paycheck you’re offering is awesome AND your dates are solid, you’re going to have to settle for a “if nothing else comes up” commitment.

So start looking at reels and interviewing people, by all means, but don’t count on hiring people for sure until a couple of months before the shoot starts.

I like to create shopping lists of the props, set dressing, costumes, wigs, etc. that I’ll need to obtain for the shoot. In creating this list, I focus on the following:

  • What’s already at the location that I can use for free/cheap?
  • What do I own?
  • What can I borrow for free?
  • What can I rent for cheap?
  • What can I “buy and return?”
  • What do I have to fabricate or purchase?

This leads to a lot of dumpster-diving, making phone calls to friends, closet-raiding, and other activities. The good news is that you don’t have to do all this work at once. The bad news is that, like everything else on this list, you should start it as early as possible.

One thing I would caution against is assuming that actors can bring their own wardrobe. Depending on their financial situation, day jobs, and/or taste, you may not be able to find a three-piece suit or formal evening gown in their closets that you can use. And if you do, keep in mind that it’s your responsibility to make sure they show up with it on the day, that it’s cleaned regularly, and that a second rented/purchased, if possible. Actors sweat a LOT – the lights are hot, the AC has to be off for sound, and the work itself is nerve-wracking and physical – so make sure they can get into a clean version of their clothes the next day.

Similarly, locations are seldom perfect and may change between the scout and the shoot. You may have to live with the location as is (not always the worst thing in the world), or spend some time before the shoot crew arrives rearranging things. The key on a low budget is to be flexible.

There’s more to come, but I’ve got to get back to work here. Casting begins in a couple of weeks. I’ll let you know how that goes!

Video Pitch Online

We just finished and uploaded a video pitch for Found in Time. You can check it out on In it I try to describe the story, what we’re trying to do in making it, and how you can help us make it happen.

I want to take a moment and thank everyone for their donations of time, energy and money. The making of the video actually highlights another aspect of the DIWO (Do It With Others’) ethos. My friend, writer/director Rick Mowat, donated his video and sound gear. Several other friends and colleagues watched various early versions of the pitch and offered excellent constructive criticism. Bob Seigel, another long-time friend and the legal counsel for the film, made sure all my i’s were dotted and t’s crossed. And Vimeo, Indiegogo, Facebook, Blogger, and Contactology have made it possible to tell people about the pitch for little to no dough.

If you had to add up the real cost of that advice, service, gear, and hosting, it would be quite a bit. So thank you to all who’ve taken time out to help us in our quest to bring the film to fruition.

Some More Business News

As I said in one of my previous posts, the temptation is to just shoot the damn thing. But while you definitely need to have that energy and enthusiasm, you also need to cover your butt and do a few business-type things first. You’ll be happy you did in the long run, and while it will drain some of that enthusiasm away at first, later it will free you from various worries and let you make your film. So here’s an all-too-brief overview of the steps you should take to get your film on the rails.

1. Copyright the script with the U.S. Copyright office: For $35 you get your work protected (at least somewhat). Also, SAG will usually require a proof of registration of the script, so just do it.

2. Do a breakdown, schedule and budget for the script, so you know how much to ask for and about how long it will take to shoot. You can hire a line producer for this job (the cost will range from several hundred to a couple of thousand), or do it yourself.

There are definite pros to hiring a line producer. If they have any experience at all, they’ll find and show you the expensive elements in your script, and give you at least an ideal schedule. They also have a good sense of what things cost in the particular place you’re shooting (labor prices, as well as goods and services, vary from region to region).

But I recommend that you do it yourself instead and hire a line producer to check your work. Just don’t kid yourself about how much time it takes – you’ll need a month or more to do this step. But you’ll be learning a valuable skill, and you’ll get to know your script inside and out. It may even help you do a rewrite, both to make things cheaper and also better dramatically.

3. Decide if you’re going to need investors, or if you can get by with your own money plus lots of favors (probably all of them you ever had coming to you) plus a credit card, loan, grant, second mortgage, etc.

I STRONGLY advise you to consider the POSSIBILITY of having investors. It affects many business decisions you’ll make from this point on (see points 4 and 5). And yes, your mom or uncle or whoever who wants to give you money for the film – unless it’s under $1000 or an outright gift – should be considered an investor. Even if you go it alone, any bank down the road will want to see some kind of corporate structure in place before they give you a loan. And psychologically, I think that having to think of other people and their money while you’re making your film can be a good thing – it forces you to examine the film from an outsider’s perspective.

4. If you need investors, put together a business plan. This is a 30-50 page document (or a PowerPoint slideshow) that explains, in as simple terms as possible: what your story is, why it’s special, how it fits into the film marketplace, what your financial goals are with the film, and why anyone in their right minds would want to invest in it.

You can hire other people to do this for you (be prepared to pay a few grand) or learn how to do it yourself. The best book I’ve read on this subject is Louise Levison’s Business Plans for Independents. Again, I recommend you at least try to do it yourself. You may find it a STEEP learning curve, but it will force you to consider your story from yet another perspective.

5. Decide on Incorporation. You’ll need an entity separate from yourself to make the film, hold onto your investor(s)’ money, and deal with all the vendors and crew and SAG. There are several types of business entities, but the most common are:

Subchapter S Corporations: these are designed for small businesses. They offer a “pass-through” mechanism so that income from the corporation is allowed to pass through the corporate “veil” to the owners. S Corps are easy and cheap to form, don’t require a lot of maintenance from the IRS and state tax agency, and can have investors (they become shareholders). You can set up a mechanism whereby you will always own the majority of stock. This keeps you in the driver’s seat while allowing other people to put money into your project.

So what is the problem? Well, because of the “pass-through” regulation, S Corps do offer somewhat less protection from lawsuits which would see to pierce the corporate veil (ie, go after your personal assets). In most states, there’s an upper limit on the number of investors that one S corporation can have. And other corporations or entities can’t become investors.

C Corporations (C corps) offer a solution to all these problems, but aren’t really set up for small business owners. You have a MOUNTAIN more paperwork to file and track, and depending on your budget, you may have to file with the SEC. Trust me on this, you don’t want to create a C Corp.

Limited Liability Partnerships (LLPs) used to be the entity of choice for filmmakers. You become the managing partner; investors become limited partners. The company is structured to give you most of the creative and strategic control, while protecting the investors’ money and legal responsibility (the middle “L”) in case you screw up. But these are relatively clunky, and are treated by the IRS as partnerships, not corporations.

Limited Liability Companies (LLCs) combine elements of corporations and partnerships. You become the Managing Member; investors just become Members. An operating agreement defines the different roles. You’ll have to do a few things (the next few steps) to set up the company.

If you think you’ll have more investors than, say, your uncle, you’ll want to form an LLC. It offers the best combination of protection, paperwork hassle, and flexibility. It’s also “the devil you know” – any investors who are NOT your friends or family will be expecting you to have an LLC.

You don’t have to form an LLC right away, but should do it within the same year you go into production. You’ll need a few weeks to set it (and all your other stuff) up, so you should schedule accordingly.

6. File the incorporation paperwork. Here’s where I get lazy. You can file the paperwork with the state yourself, but I usually use Inc It Now‘s service for the initial filing. They charge a premium but can deliver the filing receipt and other paperwork faster than you’ll get it back from the state otherwise. Expect to pay about $450 or so. Most of this goes to the state filing agency, with the rest paying for postage, your “black beauty” (the big thick book containing your corporate seal and all your corporate documents), and Inc It Now’s service fee. For this you’ll get a filing receipt with the state you incorporated in, a black book with stock certificates and other paperwork, your corporate seal, and your initial articles of organization (a brief contract explaining how the LLC works).

I recommend you incorporate in the same state you’re doing business in. While you can incorporate in a different state, you’ll have to file additional paperwork within your own state to be treated as a “foreign corporation.” You may also have to pay some taxes. It’s more of a pain. Some people maintain that it’s worth it, however, because each state taxes corporations differently. That’s why you’ll see a lot of LLCs that were incorporated in Delaware but do business in New York.

A word of advice on Inc It Now’s services: they have several “packages” available. The best value for your money, however, is to just let them do the initial filing, and for you to handle the following steps (below) yourself.

7. Get an EIN. Once you get the black beauty and the filing certificate, go to the IRS website and file for an EIN. An EIN is the corporate equivalent of a social security number, and you’ll need it to do just about ANYTHING else. Their new online form is pretty good – it’s actually written in English, as opposed to IRS-ese – and you’ll get an EIN right away. Doing this yourself will save you some $$$ over letting Inc. It Now do it for you.

8. Get your filing receipt. A couple of days to a few weeks after you get your black beauty, you’ll also receive a copy of the filing receipt from the state, with a state seal stamped on it. You’ll need this later, so hold onto it.

9. Publish. Depending on what state you incorporated in, you may need to publish a notification of your company’s existence. Two newspapers or circulars publish a daily classified listing stating that your company exists. This is possibly the biggest pain in the ass in this whole ordeal, and apart from a payola scheme, I don’t really know what purpose it serves anymore. I recommend contacting Hudson Advertising if you live in New York (212-732-0337). They get paid by the publishers, so there’s no surcharge to you above the advertising fees (which range from $600 to $1800, depending on the state and, believe it or not, the county of your company’s address). The problem is that if you don’t do this step, the state government can simply declare your corporation invalid. Then you’ll have to start over again.

10. Open a bank account. Once you have your filing receipt and your black beauty, you should open up a checking account with a bank you can tolerate. If you have a budget big enough to justify an escrow account, you’ll want to set up an escrow/production account. This is really two accounts bolted together: an escrow account (where the investor money goes into), and a production account (where you write checks from). You can’t tap the escrow account until you’ve hit the break point (this is up to you to determine). The escrow account can be further set up to track individual investors’ monies, so the bank can send statements back to each investor.

If you’re doing a film for less than $100K, chances are you need whatever money comes in AS it comes in, so you’ll probably want to just set up a simple corporate bank account. You’ll need your EIN and usually the filing receipt or articles of organization (that’ll be in your black beauty), as well as your personal ID.

One important consideration: how many ATMs does this bank operate in the city/town you’ll be shooting in? During production, you’ll often find yourself in need of cash, and you don’t want to piss away money on ATM fees, do you?

11. Set up Your Online Merchant Account. Next (for now), you’ll want to set up an merchant account, and possibly a Paypal account so you can take donations online. These accounts link back to your bank account. Most crowdfunding sites require one or the other (Indiegogo requires an Amazon account).

There are a few more steps to take but you’re probably exhausted from reading this far, so we’ll cover the rest in the next post (I promise). While it all seems like a lot, and it can be somewhat intimidating, if you leave yourself enough time, you’ll be rewarded by (a) learning a lot of new things (which is never bad) and (b) preparing yourself to think like a business person, which you’ll need to do at the other end when you’re trying to sell your film. You’ll also get more acquainted with your script, and may see some things that need changing (it’s always cheaper to figure this out early).

Business First, Fun Later

Starting the moviemaking process is like arriving at the beach after a really long drive. You get out of the car, uncramp your legs, and look at the gorgeous, calming waves. You want to dive right in… but first you need to move all your stuff into the motel room, change into a bathing suit, put lots of suntan lotion on, and probably eat something.

All I want to do is shoot. But first, you have to take care of business. So that’s what I’ve been doing for the past few weeks.

First I broke down the script and put a rough schedule together. Then I created a budget for production and post. After crying over how expensive everything seems to be, I cut the budget down to my original target – $110K.

Now I’m setting up the Limited Liability Company (LLC) that will serve as the production entity for the film. Found In Time LLC will take donations and investments, write checks, rent equipment, obtain insurance, and ” do” all the film-related stuff.

Those of you who aren’t familiar with this end of the film business need to pay attention to this – you don’t want to make a feature film as a single individual. Incorporation protects you on several levels:

  • The company stands between you and any potential lawsuits that come up during production. Short of defrauding your investors or running off with the payroll, you as a private citizen can’t be sued, only your company.
  • The company signs with the Screen Actors Guild and whatever other guilds and unions you have to deal with. This means you can make your next film a non-union one if necessary. If you as a private person sign with SAG, however, any film you’re helming will have to be a SAG film – signatory status is for the life of the signer.
  • Taxes: corporate income is taxed far differently (and more favorably) from individual wage income. The reasons why are too complex to go into here, but trust me – this is why the rich incorporate
  • Structure: If you do have investors (even if – or maybe especially if – they’re you’re relatives), you’ll need some kind of recognized business structure to deal with the matters like their investment, profit participation, who’s in charge of the film’s future, etc.

There are a whole host of other reasons to incorporate, but those are the most prominent in my mind. It’s like putting suntan lotion on.

So that’s the big news this week. By next week, I should have a bank account and merchant account set up. This will enable me to start the crowdfunding process.

Also, in a couple of weeks I’ll be meeting with my DP, the awesome Ben Wolf to talk about the look of the film. Out of that should come some more concept art and scout photos.

Welcome to Found In Time

Found in Time is the latest indie film from writer/director Arthur Vincie. Over the next several months, I’ll post insights, rants, how-tos, and other thoughts about filmmaking as we approach the ultimate date: the start of production.

The point of filmmaking is to entertain, educate, and have fun while doing so. So I invite you to look into my brain for the next few months as I try to do just that. More technical and general posts will be on my other blog, at my company Chaotic Sequence, Inc..