The Film production industry is an important industry that can never be toiled with especially in the US. While revenues from television production in the US were estimated at $30.8 billion in 2010, that of movie and video production in the US were estimated at $29.7 billion in the same year.
This is so because as the TV and film industries grew through the 1990s, so did concern over runaway productions, TV shows and films that are intended for a US audience but are filmed in other countries in order to reduce production costs. The issue of runaway productions gained further traction after Canada adopted a movie production incentive program in 1997.
Also in the 1990s, U.S. states saw the opportunity to launch their own production incentives as an effort to capture some of the perceived economic benefits of film and TV production. Louisiana was the first state to do so in 2001, and in 2002 passed legislation to further increase the scope its incentives.
Over the next three years Louisiana experienced an increase in film and television productions some of which were nominated for Emmy Awards. The perceived success of Louisiana’s incentive program did not go unnoticed by other states, and by 2009 the number of states which offered incentives was 44, up from 5 in 2002.
Though entertainment is big business in the United States; this is because it’s an industry that concerns all, and it is expected, that the sector as a whole will have generated 564 billion U.S. dollars in revenue by the end of 2014.
Further forecasts predict that the entertainment industry will grow to over 679 billion US dollars in value over the next four years, proving its worth in domestic markets and as a major U.S. export. Meanwhile the film industry which is considered a cornerstone of the industry is one of the biggest, in fact the biggest, player in the broader entertainment sector.
Many people are also encouraged to join the industry due to the opportunity it portends; there is quite a plethora of opportunities in this industry, which will continue to permeate it for many years to come. The film production industry is a lucrative one, and it will continue been patronized by many.
Starting a Film & Video Production Company – Market Research and Feasibility Studies
- Demographics and Psychographics
Just like in many industries, the demographic and psychographic composition of those who need the services of film production is indeed wide. This is basically due to the fact that been an entertainment company, a large group of people which cuts across the public sector, the organized private sector, households, communities and people of different class and from all walks of life.
Below is a list of the people and organizations that need the services of film production companies;
- The public sector (public facilities et al)
- Organized private sector (Corporate organizations)
- Businessmen and Businesswomen
- University Campuses and Schools
- Event Planners
- Estates and Communities
- Religious Centers
- Sport Organizations
List of Niche ideas Within the Film and Video Production Company That You Can Specialize in
Just like in many industries, there are a wide variety of niches that can be ventured in order to succeed as a film production company. This is due to the fact that, there are quite a lot of niches in the entertainment industry especially in the film production company, and these niches are critical to the growth and development of the industry.
Here are some niches / areas that a film production company can be specialized in;
- Art movie
- Music video production
- TV show production
- Documentaries production
- Script reading
- Film schedules planning
- Checking and approving of locations
- Participating and collaborating with marketing companies
- Film cash flow management
- Sales and distribution of films to target audience
The Level of Competition in the Film and Video Production Company Industry
Surviving in the business world is indeed a herculean task; in the entertainment industry it is even more competitive. The fact that there is competition in the film production industry cannot be over-emphasised, what thus matters for anyone delving into the industry is to network with key people that matters; decision makers that can ensure that a target audience is won at all costs.
Without mincing words, there are a lot of big time investors and brands in this industry but one thing is certain, there is room big enough to accommodate both the established ones and the upcoming ones to survive. Therefore, as a budding player in the industry it is important to choose a niche that matters, no matter how small it might look and then follow it to the latter. This will go a long way to assist you in achieving the desired results.
List of well – known brands in the Film and Video Production Company Industry
There are usually established brands in any industry. Brands that have made a mark and have successfully registered their names in history cannot be left out in the scheme of things. The film production industry is also populated with brands that have made their mark, and have been instrumental in the success of the industry till date.
Here are some of the leading film production companies in the United States of America;
- 3ality Digital
- 40 Acres and a Mule film works
- 606 films
- 2929 productions
- Allied Artists pictures corporation
- Amblin Entertainment
- American international pictures
- American zoetrope
- Artisan Entertainment
- Blue star studios
- Capitol films
- Castle rock
- Caravan pictures
- CBS Films
- Cinemation industries
Starting a film production from scratch involves a lot of sacrifices and other expense it is indeed a serious business hence critical economic analysis must be conducted to ensure that the risks and other threats associated with starting a business from the scratch or investing in a business idea are curtailed.
If you are considering starting a film production company in the United States, your concern should exceed beyond restricting yourself to just acquiring an office facility and equipping the facility or hiring the best hands in the industry, you should also be concerned on how to attract clients and secure mouth-watering film productions.
Averagely, setting up and starting a film production company is costly, as the financial attachments to it is really much, but with dedication, planning and the right mindset, the output is usually huge and baffling.
Is a Film and Video Production Company Worth Starting from Scratch or is Buying a Franchise Better?
Although there is the possibility of buying a franchise from a successful film production company or even partnering with a big company if you are considering owning an investment in the film industry.
One thing is certain, people are motivated to start a business based on various factors and incentives. If you are looking towards building a business that you intend controlling, a business brand that you hope to one day transfer ownership to your children and perhaps also sell franchise in future, then starting from the scratch should be your best bet.
But if you only interested in making money and multiplying your wealth, then you may as well buy the franchise of a successful film production company that is willing to sell its franchise.
Possible Threats and Challenges You Will Face When Starting Film and Video Production Company
Generally in the film industry, both the already established companies and start – up film production companies are subject to threat and challenges from government policies, global economic downturn which usually affects spending and unforeseen natural disasters (disasters that may cause setback).
Another threat that you are likely going to face when you start your own film production company is the arrival of a well – established film Production Company in the location where your business has strong presence.
Starting a Film & Video Production Company – Legal Matters
- Best legal entity to use for a Film and Video Production Company
No doubt starting a film production company is indeed a serious business. This is why meticulousness and seriousness must be the watchword especially as regards the legal entity you choose will go a long way to determine how big the business to can grow.
When it comes to choosing a legal entity for your film production company you have the option of choosing from a general partnership, a limited partnership, an LLC, a “C” corporation, or a “S” corporation. It is important to clearly state that these different forms of legal structure for business has its own advantages and disadvantages; which is why you must weigh your options properly before making your choice on the legal structure to build your film production outfit on.
These are some of the factors you should consider before choosing a legal entity for your film production company; limitation of personal liability, ease of transferability, admission of new owners and investors’ expectation and tax issues.
If you take your time to critically study the various legal entities to use for your film production company, then you will agree that limited liability company; an LLC is the most suitable. You can start your film production company as a limited liability company (LLC) and in future convert it to a ‘C’ corporation or even a ‘S’ corporations especially when you have the plans of going public.
Upgrading to a ‘C’ corporation or ‘S’ corporation will afford you the opportunity to grow your company so as to compete with major players in the film industry; you will be able to generate capital from venture capital firms, stock market, you will enjoy separate tax structure, and you can easily transfer ownership of the company; you will enjoy flexibility in ownership and in your management structures as well.
Catchy Business Name ideas Suitable for a Film and Video Production Company
When it comes to choosing a name for your film production company, it’s important you take your time to thoroughly choose one that represents the interests of your company. This is because many persons are motivated to get involved or even partner with your company due to the kind of name it is. While keeping it short and simple, you must make sure it’s appealing to the eyes and ears.
Here are some catchy business name ideas you can choose for your film production company;
- Film 360 Inc.
- J & J Films
- Twain Films Ltd.
- Revealed Productions
- Famz 24/7 LTD.
The Best Insurance Needed for a Film and Video Production Company
In the United States and of course in most countries of the world, you can’t operate a business without having some of the basic insurance policies that is required by the industry you want to operate from. Besides, the nature of the film industry requires that you have the proper insurance cover in place or else you will be forced out of business if anything goes wrong with your production.
So, it is important to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best insurance policies for your film production company; it is their duty to help you assess the risks involved in the type of film production business you intend running and then advice you accordingly.
Here are some of the basic insurance covers that you should consider purchasing if you want to start your own film production company in the United States of America;
- General insurance
- Health insurance
- Risk Insurance
- Payment protection insurance
- Liability insurance
- Workers compensation
- Overhead expense disability insurance
- Business owner’s policy group insurance
Intellectual Property Protection and Trademark
If you are considering starting your own film production company, it is necessary to have the required intellectual property protection and trademark. The fact that, film production and the processes involved in it are intellectually stimulating cannot be stressed enough.
This is why it is very much necessary to ensure that the intellectual property protection trademark is done, so as to protect your productions from those who have no other motive than to claim others intellectual work. When this is properly done, it will be easy to monitor and trace anyone who does anything contrary to this, and effectively prosecute them too.
Is Professional Certification Needed to Start a Film and Video Production Company?
The film industry is one of the industries that is highly regulated so as to prevent costly breaches that could endanger the peace and security of a country. It is for this reason that if you are looking towards beginning a film production company, then you should acquire international film certifications; it will give you edge amongst your competitors. And also make more people to participate actively and engage you the more.
For this industry, the most important certification is the Certificate in Film production, this is been anchored many higher institutions of learning, and can go a long way to boost the prestige of one as a professional, and the company as an entity.
List of Legal Documents You Need to Run a Film and Video Production Company
In The United States of America and of course all over the world, the film industry is amongst the industries that is highly regulated so as to avoid costly breaches in the country that could endanger lives and properties. If you are considering starting a film production company, then you are expected to meet the legal documents requirements as stipulated in the constitution of your country.
These are some of the basic legal document that you are expected to have in place if you want to start a film production company in the United States of America;
- Certificate of Incorporation
- Security Clearance Certificate
- Business License
- Business Plan
- Non – disclosure Agreement
- Memorandum of Understanding (MoU)
- Employment Agreement (offer letters)
- Operating Agreement
- Company Bylaws
- Operating Agreement for LLCs
- Insurance Policy
Writing a Business Plan for your Film and Video Production Company
If you are looking towards starting a film production company, then you must be concerned about your business plan, and this is why one of the first steps that you are expected to take is to consult experts to help you write a good and workable business plan. The truth is that, in order to successfully run a film production company, you would need to have a good business plan in place.
A Business plan is the blue print that is needed to successfully run a business; with a workable business plan in place, you will reduce the trial and error approach of doing business. You will be able to manage your business with purpose and perhaps precisions; you will know what to do per time and how to handle challenges, growth and expansion.
So if you want to start your own film production company, you are required to write a detailed business plan that can pass reality test when subjected to it; you should work with the facts, figures and other indices in the security industry as it applies to the country you intend starting the business.
The whole idea of writing a business plan is not just for the sake of having a business document in place; but a detail guide on how to effectively run your business from the scratch. Your business plan should outline and cover strategies on how you intend to manage and grow your film production company.
The basic thing that you should never neglect in writing a business plan is to try as much as possible to be realistic and never to over project when putting figures on income and profits et al. As a matter of fact, it is safer to underestimate when writing a business plan so that you won’t be so disappointed when reality sets in.
The major areas that are expected to be covered in the business plan are as follows;
Executive summary and Company’s descriptions: Here, you are expected to write about the concept of your business, descriptions of your company, your company’s vision statement, mission statement and where your company will be located and also if you intend selling out franchise or opening outlets in different cities in the United States of America and in other parts of the world.
Other key components that should not be missing in your business plan are products and services offering, SWOT analysis, competitive analysis, marketing and sales analysis / strategies, target market, market goals, pricing, costing and financial projection, publicity and advertising strategy, expansion and growth strategies, budget and start – up capital generation et al.
A Detailed Cost Analysis for Starting a Film Production Company
There are several expenses that you would have to make before successfully launching your own film production company. It is important to state that the location you choose to launch your business will definitely impact on the overall cost of starting the business which is why it is very important to have concluded and analyzed your feasibility studies and market survey before drawing up a budget and sourcing for funding for your business.
Here are some of the basic costs you must look towards fulfilling when starting a film production company in the United States of America;
- The Total Fee for incorporating the Business in United States of America – $750.
- The budget for Insurance, permits and license – $5,000
- The Amount needed to rent a suitable office facility with enough space in the United States of America (Re – Construction of the facility inclusive) – $50,000.
- The Cost for equipping the office (computers, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al) – $15,000
- The cost for acquiring relevant film production gadgets and equipment – $50,000
- The Cost of Launching an official Website – $700
- Additional Expenditure (Business cards, Signage, Adverts and Promotions et al) – $2,500
- Other miscellaneous – $1,000
Going by the report from our research and feasibility studies, we will need about $150,000 to set up a small scale film production company in the United States of America.
On the average, you would need over $250,000 US dollars to start a medium scale private security company in the United States of America. If you choose to start a large scale private security company, then you should look towards budgeting about 2.2 million US dollars and above. This money includes paying security experts that will be on your employee / payroll.
Financing Your Film Production Company
If you choose to start your film production company on a small scale, which is even quite difficult, you might not need loads of resources to launch the business, but if you decide to start on a large scale, you will sure need to raise the required start – up capital to launch the business.
When it comes to financing a business, one of the first thing and perhaps the major factors that you should consider is to write a good business plan. If you have a good and workable business plan in place, you may not have to labor yourself before convincing your bank, investors and your friends to invest in your business.
Here are some of the options you can explore when sourcing for start – up capital for your film production company;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Applying for loan from your bank / banks
- Pitching your business idea and applying for business grants and seed funding from donor organizations and angel investors
- Source for soft loans from your family members and your friends.
Choosing a Good Location for Your Film Production Company
Choosing a location for your business is not what you should do without due consultation. The truth is that if you get it wrong with the location where you have decided to pitch your business tent, you are more likely going to struggle to make headway with the business. One of the major reasons why businesses struggle, fail and eventual close shop is the fact that the owners decided to choose a wrong location for the business.
Thus as a newbie who is just starting out in the industry, it is important that you locate your business in an area with healthy business activities.
These are some of the factors that you should consider before choosing a location for your film production outfit;
- The demography of the location
- Accessibility of the location
- The numbers of private security companies in the location
- The local laws and regulations in the community / state
- Traffic, parking and security et al
Starting a Film & Video Production Company – Technical & Manpower Details
If you are about starting a film production business, then you should be ready to purchase effective film production gadgets, in fact these are some of the basic technical areas you are expected to spend part of your start up capital.
When it comes to choosing between renting and leasing an office space, the size of the private security firm you want to build, and your entire budget for the business should influence your choice. If you have enough capital to run a private security outfit, then you should consider the option of leasing a facility for your office; when you lease, you will be able to work with long – term planning.
Regarding the number of employees that you are expected to kick start the business with, you should consider your financial capacity before making the decision. But good enough, you don’t have to maintain a large workforce if you run a film production company; you can recruit and train employees when you have the need to.
Averagely, you would need a:
- Chief Executive Officer or President (you can occupy this role)
- An Admin and Human Resource Manager
- Security Consultants and Associates (Different areas of specializations as it applies to your business)
- Business Development Executive / marketing Executive
- Customer Service Officer or Front Desk Officer
You also need a large number of staff to start out effectively.
The Services Process Involved in the Film and Video Production Industry
The services process involved in the film industry depends on the niches of film production a company is into. On the average, the process starts with biding for a production, once the contract is won, then it is expected for the entire contract document to be signed and advance payment made as required.
Once this is done, the company will go ahead with production, and work meticulously to ensure that everything pans out well.
Starting a Film & Video Production Company – The Marketing Plan
- Marketing Ideas and Strategies for a Film and Video Production Company
This business is very competitive, and you must really be very careful in order to succeed therein. The truth is that if you have highly qualified, trustworthy and successful security professionals in your board and core management team, it will definitely give you leverage in the market place.
Here are some of the platforms you can utilize to market your film production company;
- Advertise your business in relevant business magazines, TV and radio station and also make yourself available for security related talk shows and interactive sessions on TV and Radios)
- List your business on local directories / yellow pages (both online and offline)
- Leverage on the internet to promote your business
- Join local chambers of commerce around you with the main aim of networking and marketing your private security company.
- Introduce your business by sending introductory letters alongside your brochure to all the corporate organizations, community leaders, schools, hospitals, hotels and government offices in your target area.
- Create different packages for different category of clients in order to work with their budgets.
- Engage in direct marketing, referral marketing and also email marketing.
Possible Competitive Strategies for Winning your Competitors in the Film and Video Production Industry
It might be challenging competing as a newbie in the film industry especially in a highly organized market like that of the United States of America, which is why you must be deliberate in choosing your board members and your core management team.
As a film production company, if you have the required expertise and equipment to carry out a security contract, then you are likely not going to struggle to compete in the industry. Hence, ensure that you put in your best whenever you have the opportunity to handle any production. Excellence, creativity and good service delivery must be your watchword at all times
Forming key partnership with major players in the Industry will also go a long way to aid your company.
Possible Ways to Increase Client Retention for your Film and Video Production Company
In every business no matter the industry you choose to pitch your tent in, one of the easiest ways to increase customers’ retention and perhaps to attract new customers is to satisfy your customers always. If your customers are satisfied with your services delivery, they can hardly source for alternative service provider or products.
Statistics has it that one of the major reasons why customer’s source for alternative service provider or product is when there is a drop in quality. Another reason is poor customer service. If you can continue to improve on the quality or your services and your customer service delivery, then you won’t struggle to maintain your loyal customers.
So you must ensure that your customers are always satisfied with your services, and always willing to collaborate with you. You must also put a mechanism in place to ensure that, feedbacks, enquiries and questions from them will be entertained.
Strategies to Boost your Brand Awareness and Create a Corporate identity for your Film and Video Production Company
When it comes to creating brand identity for a film production business, the calibre of clients you have worked for and the nature of productions you have handled is always a major brand booster.
It is pretty important to work with your consultants to help you map out publicity and advertising strategies that will help you walk your way into the heart of your target market. First and foremost, you should ensure that your brand is visible and well communicated which is why you should make provisions to work with different class of people in the society. All your publicity materials and jingles should be done by some of the best hands in the industry.
Below are the platforms you should leverage on to boost your brand awareness and create a corporate identity for your film production company;
- Introduce your business by sending introductory letters alongside your brochure to all the corporate organizations, community leaders, schools, hospitals, hotels and government offices in your target area.
- Advertise your business in relevant magazines and websites
- List your business on local directories / yellow pages (both online and offline)
- Promote your business on satellite TV stations and radio stations.
- Engage in direct email marketing
- Leverage on the internet (social media platforms and your official websites) to promote your business
- Ensures that your workers wear your branded shirts at all times during working hours and also make sure you brand all your company’s official vans, trucks and cars et al.
Creating a Suppliers / Distribution Network for a Film and Video Production Company
The nature of the film industry gives room for companies to network amongst themselves and also network with government own agencies. This is so because that is the nature of the industry, as there are always need for the exchange of manpower, technicalities, etc. to ensure a successful production.
It is important to state that there will always be room for a film production firm to form strategic alliance with one another which is why it is important to maintain a good network within the industry. This is necessary, as it is a well known fat in the industry, that no one person can successfully execute the task alone.
Tips for Running a Film and Video Production Company Successfully
The truth is that, irrespective of the kind of business you run, your ability to get all the members of your team on same page at all times is one of the keys you need to successfully run the organization.
As the chief executive officer or president of a film production company, it is you responsibility to give direction to the business. Part of what you need to do is to ensure that you create time for office meetings; a time where challenges, feedbacks, projections and relevant issues are discussed. The meetings could be daily, once in a week, twice a week or once in a month. The bottom line is that there should be consistent meetings in your organization.
Since the production company has to do mainly with people, it is necessary that you carry out appraisals on a regular basis and training your employees will help you run your organization effectively. Encourage your employees to pursue certifications in their various areas of specialization; it will help your organization’s profile and of course it will help the individuals. You can choose to fully or partially sponsor some of the certifications.
Lastly, you should keep your doors open for suggestions from members of your team and your clients. It is very important to reward excellent performance in your organization; it will go a long way to encourage healthy competition in your organization.
SOURCE: Profitable Venture