Tag Archives: film budgets

How to Manage Your Film Budget

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Financing a movie requires a producer who understands the different production management tools.
Financing a movie requires a producer who understands the different production management tools. | Source

Checks and Balances of Budgeting a Film

As a filmmaker, it is essential to understand how to control money while making a film. Not everyone in the production is concerned about the money, but someone has to ensure the money is used correctly and supports the overall production. Sure, the line producer is watching the costs, but it is not just his responsibility. It is also your responsibility as the producer. Here are some key points to consider when taking control of the production money.

Above-the-Line

This article has touched on this area of budgeting, but a closer look would help gain a better understanding of the cost and should help the filmmaker. Above-the-line covers all costs associated with the writer, director, producers, cast, and stunts. The costs are controlled by competition, including other studios, production companies, and financiers. This aspect of the budget comes into play at the early stages of the project and rarely influences cost-control decisions once the film is in production. However, stunt performers often face unpredictable problems, and if a filmmaker can avoid using them, all the better. When a script calls for a character to be injured on camera, a stunt performer is required. The producer needs to control this production area because significant savings can be achieved by effectively managing stunts.

The casting budget is one of the trickiest costs to predict because so many variables come into play with on-screen talent. The Screen Actors Guild bargains for pay for actors in the industry. Some production companies agree only to hire SAG-AFTRA actors, who are signatory companies. But filmmakers should not be intimidated by working with only SAG actors. The guild is approachable and willing to work with independent producers because they want their actors to work; the production agreement changes based on the shooting location. For example, a scale actor in Los Angeles will earn $859.00 a day, with ten percent going to the agent on top of the day rate. Extra actors or general background performers, represented by SAG-AFTRA, earn $ 152 per day, plus all fringe benefits. These wages can vary.

Fringes

There are additional payments to governments and unions for every dollar spent on casting and stunt work. On average, it is approximately 32% on the fringes, similar to the payroll of any company. Such costs include state, local or federal-mandated requirements. Pension, health, and welfare payments for members of guilds and other fringe groups might also be considered, including employer-funded disability and medical programs. But fringes can’t be overlooked when a filmmaker looks at ways to cut costs.

The producer needs the agreement of the line producer to stick to the shooting schedule.
The producer needs the line producer’s agreement to stick to the shooting schedule. | Source

Shooting Timeline

The film’s shooting period influences the budget. Do the math. The longer it takes to shoot a movie, the more it will cost the filmmaker. An example of the cost of producing a film with a one-day small unit “pick up” shot is about $20,000. It includes the location and rates for above-the-line and below-the-line crew, excluding principal actors and background extras.

The shooting period encompasses everything related to the time spent filming, including the time required to wrap up production, which typically takes about two weeks after shooting is completed. The costs include labor for the entire crew, camera, grip, and electric equipment rentals, construction, wardrobe, transportation, and so forth. As mentioned earlier in this article, some producers refer to this section as part of the below-the-line. Below-the-line includes post-production costs as well.

Post-Production

After they complete the shooting period, the process is called post-production. This area of budgeting encompasses editing, visual effects, sound mixing, music, and other related expenses. If the film is in poor shape when it reaches post-production, the filmmaker, director, and producers do everything in their power to correct it. Everything could go well during the shooting period, but the climate might change once the project reaches post-production. There are endless stories about runaway productions happening in post. In their professional opinion, the studio and financiers want to create the best “look” possible. The film can look even better because technical experts can bring to life any image or idea the studio and financiers desire. If the filmmaker loses control at this point in the film’s budgeting, all the hard work is for nothing. The filmmaker must understand the importance of a tight, coordinated effort with all the key players, including producers, directors, editors, post-production supervisors, and financiers.

Other Costs

As a final point, they often overlook other costs when budgeting the project because they are not glamorous or creative. They include insurance, legal expenses, on-set publicity costs, and other related expenses. The financiers are familiar with this aspect of budgeting and typically know the different costs before agreeing to finance the production. Filmmakers should involve financiers, the studio, a bonding company, and the line producer when discussing additional expenses to protect themselves and gain insights from experienced opinions.

A filmmaker might come across a financier or studio head mentioning that an “overhead” account includes the contingency. Nowadays, it is hardly ever used. The key factor is securing financing, with the bonding company agreeing to provide a bond for the project. As a side note, there is no way to avoid a bonding company when a bank participates in the overall production. Obtaining a completion bond is not a bad idea because it guarantees investors or banks that the film, barring an Act of God, can be produced effectively and within the budgeted amount.

The Weekly Production Report keeps the executives and accounts updated.
The Weekly Production Report keeps executives and accounts up to date. | Source

Budget Points

All budget points can typically be found on the budget summary sheet. Once the filmmaker has the budget in place and approved, their attention needs to shift from budgeting to reporting expenses as they arise. The line producer and production accountant can help the filmmaker with the comparisons. The comparisons are traditionally referred to as the Weekly Cost Report. It is a progress report on the financial performance of production.

The Weekly Cost Report

The Weekly Cost Report brings a whole new meaning to being creative and is an adventure in discovering the many ways to bring cost reporting to life. The production accountant and line producer can be your allies when gathering expenses. Accounting can utilize a technicality that filmmakers need to know when reporting the Weekly Cost Report. It is all about how the filmmaker controls the money by learning how to direct the reporting process sufficiently and ethically, resulting in a decent yet dependable presentation of the production costs. The filmmaker is presenting the progress report to those backing the film production. Regardless, the report is provided to the studio executives, bonding company, and financiers every week.

Alternative Funding

Not having enough funds to finish a film is common among independent filmmakers and producers. The key is to keep going and find alternative sources of funding to see your production through to the end. Alternative funding campaigns offer a tremendous opportunity to leverage a financing route that involves the whole community from day one. As the producer or filmmaker, you must choose the best funding source for your production. It will take hard work and a dedicated team to pull it off. The hard work is doing your homework and learning how to do it successfully. The Internet is full of resources, and each funding platform offers directions and guidelines to achieve your funding.

Crowdfunding

Crowdfunding is a resource that has an excellent track record.

There are three reputable platforms: GoFundMe, Kickstarter and Indiegogo. As a filmmaker, you must study these platforms to learn how to get the best funds for your efforts. The key is to rally your team, from actors to production designers. Every individual who plays a role in your film should be involved in the crowdfunding project. The more players you have, the better the chance of reaching your funding goal.

Grants Help Funding

Funding a film production through grants is a resource that has been around for quite some time. They fill the Internet with endless resources for filmmakers to use in grant applications. They set most grants up for a particular quality or forte of the film being produced. For example, African Americans, Native Americans, or Women in Film are popular areas for grant applications. But one of the first things grant readers look for is “passion and connection to the project.” The readers view thousands of applications and know that the most essential ingredient in a proposal is the person’s passion for the project. It will still be there three years from now, as it may take too long to finish the film.

A resourceful producer or filmmaker will discover unique ways to fund their movie.
A resourceful producer or filmmaker will discover unique ways to fund their movie. | Source

Film Festivals

Film Festivals are another resource for funding a film production. The Sundance Film Festival and its institute are an excellent example of a film festival offering funding for filmmakers, from screenwriting to music. The institute’s website supports a dedicated page for its funding opportunities. Filmmakers can peruse the site and understand what they need to present to the institute to be considered a candidate. Filmmakers attending film festivals is another way to network and find funding.

Foundations Help Fund Film Productions

Foundations are another source of funding for a film production. These foundations offer grants, just like applying for one. Knowing who you are approaching is critical when applying for a grant. Who are the judges? What projects have you won before? Were they first-time filmmakers? Did they have a history of documentary films or feature films to win? Look at the prior winners to give you an idea of who you are applying to. Then you can direct your application to that person.

How to Develop a Film Production Budget

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Learn the ins and outs of creating a film budget. It leads to less stress and more success. This article shares key points for a successful film production budget.

Mastering a film production budget gives you the power to produce fantastic movies.
Source: RDNE Stock project

Budgeting is an integral part of becoming a successful filmmaker. Developing a budget for your film requires you to forecast the costs of producing the movie—the more complex the project, the more specific details you need to set within the budget. In a nutshell, the film’s budget is your guidebook. Your success is based on how well you can follow your budget and prevent production costs from escalating. The budget is simply a guidebook that controls costs and safeguards the money needed to produce and bring the film to the silver screen.

The budget is all about listing every expense involved in making the film before production. The filmmaker can create a complete and thorough budget after breaking down a script and organizing a production board. The filmmaker working with the line producer does the task, which saves the producers a lot of heartache.

The budget is based on the screenplay you choose to produce. A story with few characters and locations in your hometown is cheaper than one with many characters and locations worldwide. Developing a sound budget depends on how well the script is broken down in terms of cost.

Example of Budgeting a Film Script

For example, a screenplay may appear simple with only one, two or three characters, yet it may include a scene that describes:

53. EXT – FARM – NIGHT

Flashes of lightning cover the night sky. Three Horses race out of the barn as lightning strikes the giant oak tree. Helen comes out of the farmhouse to face the burning tree and watch the horses run off.

Even though the “flashes of lightning cover the night sky” and “Three Horses race out of the barn as lightning strikes the large oak tree” offer stimulating visuals, they could cost hundreds of thousands of dollars to create. Filmmakers may need to rewrite a dramatic scene to fit a smaller budget.

53. EXT – FARM – NIGHT

Flashes of lightning light up the farmhouse. Horses squeal and roar from the barn as Helen hears lightning strike the giant oak tree. Helen comes out of the farmhouse to face the burning tree. She crosses to the barn and sees the empty stalls. The horses have run off.

Going with the first attempt would have resulted in higher costs. The creation of lightning, horses racing out, and lightning strikes on the giant oak tree would have required additional crew, a special effects coordinator, and computer-generated imagery. The second attempt keeps the storyline with flashes of lightning on the house, not in the sky. The burning oak tree can easily be a prop in the dark. Hearing the horses and Helen seeing that they had run off doesn’t require horses. A creative filmmaker can keep the budget down as long as the storyline moves forward. In other words, more money spent on a film means more problems to solve.

Several Budget Top Sheet templates are available online. Find the one you’re most comfortable using.
Source: Fillm Proposals

Budget Top Sheet Organizes Expenses

Filmmakers work off a Budget Top Sheet. It provides a summary of how the money is allocated during the filmmaking process.

At the top of the top sheet is the general information used in forming the budget. The names of the producer and director are listed at the top because they are responsible for overseeing the overall budget. Other information given is the start date and completion date of the production. It is imperative to understand the top sheet, as any changes to it will affect the entire budget dynamic. The top sheet will inevitably change because the production stage of a film is the most liable aspect of the process. Unknown factors, such as location, weather, actors, stunt performers, and production issues, can cause liability.

Above-The-Line vs Below-The-Line Costs

Two distinct divisions separate the budget: above-the-line and below-the-line. Based on the early days of Hollywood, the positions above the line were the more important creative elements in the production, such as screenwriters, producers, directors, and actors. Any costs relating to these categories were above the line. The below-the-line division is subdivided into the production period, the editing period, and miscellaneous overhead expenses associated with the entire production process. Obviously, a production designer, an art director, a cinematographer, a sound designer, a composer, an editor, and a costume designer are all important creative forces. Still, their costs fall below the line. It is a wise filmmaker who recognizes that everyone working on the production is an innovative resource because filmmaking is a collaborative process.

Each production has unforeseen costs.
Source: Cottonbro Studio

Above-the-line production positions recognize the four guilds that classify certain creative personnel on a project: the Screen Actors Guild, the Directors Guild, the Producers Guild and the Writers Guild. We find all the rest of the union and federation members below the line.

Adding the above-the-line costs and the total below-the-line costs presents the direct cost for the whole production. Remember, this is not the final budget, as other unforeseen costs may arise. A contingency line is added to the top sheet for those unexpected elements. The contingency is predetermined as a percentage of the overall budget. Ideally, a 10 percent contingency fee should work. However, some productions have been as high as 30 – 40 percent. A contingency fee is the requirement for procuring a completion bond. Therefore, the direct cost, the contingency fee, and the completion bond make up the total cost for production. The top sheet of the budget also includes “other fees,” such as bank interest or other indirect costs that the filmmaker may not be aware of until after the budget is finalized.

What are Deferments in Film Production?

On the top sheet of the budget, you can include deferments. This is when the filmmaker determines that the available funds for the production are insufficient to cover the talent or services. The idea of deferred payment was introduced and developed in the 1970s. The advantage of deferred payment is that one doesn’t have the money or wherewithal to pay for the talent or services. As a result, they can pay them later. The disadvantage is that the talent or service can charge interest on the deferred payment, which will cost the production more money than if they had paid them upfront, and deferred payments are added to the negative cost. Then, the filmmaker will have a reputation for exceeding the production budget. Negative cost is the expense of producing a film. It excludes such costs as distribution and promotion. An example of a sound deferment is the Directors Guild allowing producers to hire its members based on the project’s budget. If the amount is less than $6 million, they pay 70 percent of the salary to the director, while the remaining 30 percent is deferred. In the bargain, they pay an additional 25 percent to the director for agreeing to the deferment.

The filmmaker should explore all options to keep the project within its budget while maintaining creativity. Yet, the producer pays attention to innovative suggestions that deviate from the original financial plan. It’s their job to help the project stay within its financial limits.

Although a budget is created for the overall production, it serves primarily as a guidebook for making decisions within the budget’s parameters. The budget must always stay within those parameters. If it does, the filmmaker must seek additional funding to complete the project.

As the project moves into production, it will take on a life of its own. You must safeguard your creative vision while avoiding getting lost in budget misfortunes. That is where the line producer comes in and manages the overall production flow.

The Indie Producers Handbook: Creative Producing from A to Z

The Indie Producers Handbook: Creative Producing from A to Z

This is my go-to book for film production. I recommend reading The “Indie Producer’s Handbook: Creative Producing from A to Z,” written by a film producer, Myrl A. Schreibman. It delivers a comprehensive and practical guide to running a film on a budget.