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Keeping a Studio Small...The Curse of Big Studios..

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Milton HockmanKeeping a Studio Small...The Curse of Big Studios..
by on Mar 19, 2010 at 7:51:36 pm

I was trolling through a lot of old posts and it seems to me that a lot of businesses posting on Cow are struggling.

Lots of people are talking about being undercut, slow or no business coming in, etc.

So, would you say the key to being successful in this business anymore is to stay small? The smaller you are, the cheaper your rates can be (less overhead and salaries to pay.) however, it limits the size of jobs you can accept.

Are Big Studios Cursed from now on do you think? Are 3-4 people shops the best way to go?

Freelancer Designer Virginia
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Arnie SchlisselRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 19, 2010 at 8:27:36 pm

Small studios can always take on bigger jobs by partnering with other shops. This keeps everyone's costs lower, and it allows you to keep to your area of expertise, and it allows for specialists from outside your company to do what you can't do.

Arnie

Post production is not an afterthought!
http://www.arniepix.com/


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Mike CohenRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 19, 2010 at 9:24:30 pm

Size matters not. Judge me by my size do you?

Your company is as lean as you make it. Whether you are 1 person or 100, you need to analyze your business operations so that you maximize your use of resources and stay in the black.

1 person can possibly charge less, but don't undersell your services, and always think of the big picture. Sure, a larger crew needs more money overall, but you need to know how much to charge to account for the big picture.

Part of maximizing resource usage is being diverse enough so that your crew has enough to do even when new work is sparse. Also, you need to have operating procedures and business practices so that you can stay afloat between new jobs.

There is no standard answer for a question like this.

Mike Cohen


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Bob ColeRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 19, 2010 at 9:41:23 pm

The Curse of Big Studios is no cause for celebration. (I assume we have a similar definition of "Big Studios." In my neck of the woods, a big studio may employ 20-50 people.)

What is really happening is that these "big" video studios are getting squeezed from both ends: large businesses who are trimming costs, and freelancers who are happily undercutting them for work. (BTW - in today's NY Times, David Brooks (of all people) writes about the ill effects of mega-corporations on small business.)

There are other factors in the demise of the "big" local studio: individual freelancers (and small partnerships) are being empowered by ever-more powerful hardware and software; and technical support no longer requires a tech staff -- just a connection to the Internet (thank you COW and Google). One or two freelancers can produce stuff that required many more people, and huge budgets, only 10-15 years ago. But while this added efficiency is great for people like me, I am sorry to see the larger local studios disappear. It is helping us small fry a little bit, but it is helping big business a lot more. One large organization in my neck of the woods has decided to outsource 100% of its work to an agency, which is essentially marshalling the freelance community for actual labor. I'm very concerned that good jobs with health insurance and other benefits are being replaced by freelance positions with none. A lot of my younger acquaintances don't carry insurance at all, and as for 401(k)'s, forget about it; they're just trying to get by.

(This reminds me of a friend who was trying to find out a business to go into where overhead would be minimal and the labor was essentially free. He realized that was a good description of a real estate brokerage, and opened up his own agency. Even though he had about 20 people working for him, he only had to pay the receptionist and the cleaning service; the rest were independent agents who only got paid when they sold something.)

I admit to having a brief feeling of schadenfreude when a couple of rather arrogant studios closed, even while I soldiered on. But on "mature reflection," the disappearance of those "big" local studios has me worried.

Bob C


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walter biscardiRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 19, 2010 at 10:03:27 pm

It's all about managing overhead and staying within your means.

I started my company in a bedroom of my house. Did that for 2 years, got too much work and needed a bigger space.

We've been in a 1,000 square foot space 6 years now. Started by using just one room and now have four edit suites running daily.

We're going to break ground on a new 6,000 (maybe 8,000) square foot facility very shortly. The overhead will be manageable by just running one edit suite full time.

I also know my rates are lower than many of the competitors, even those who work in one man band operations in their homes. At the very least they are the same rates in most cases. But when you come here you're getting some really good people to work with and pretty much any format in, any format out, everything from start to finish in Post Production.

I made a decision when I opened the company that I would charge an honest rate and would become profitable by volume over time. Even though I keep reinvesting into the company as needed, I hold my rates because those investments keep bringing more and more projects in. I would rather lose money on one or two projects to invest in equipment that will earn money for the next 500 projects.

That's one thing I really see lacking these days. People just buying the bare minimum at all times so every time they do a new job and a client asks for a particular whatever, they have to go out and find a free widget or tool. Just look on the various forums, "Can someone recommend such and such, preferably free." Just pay for the best tool the first time and you have it.





Walter Biscardi, Jr.
Editor, Colorist, Director, Writer, Consultant, Author, Chef.
HD Post and Production
Biscardi Creative Media

"Foul Water, Fiery Serpent" featuring Sigourney Weaver coming soon.

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Bob ColeRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 19, 2010 at 10:56:46 pm

[walter biscardi] "That's one thing I really see lacking these days. People just buying the bare minimum at all times"

You see that a lot with people who are still in business. You don't see the people who've overinvested, because a lot of them are out of business now.

I'm sincerely happy for people like Walter, who have charged competitive rates, invested heavily, have a lot of talent (and perhaps, perhaps some luck) and have prospered. More power to you!!!!

But for most people, the bigger problems are: charging too little, and investing too much.

Bob C


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walter biscardiRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 20, 2010 at 3:15:46 am

[Bob Cole] "But for most people, the bigger problems are: charging too little, and investing too much."

I've seen two problems with over-investing.

1 - buying stuff because you "think you need to have it to attract clients." I've seen people drop thousands, sometimes hundreds of thousands of dollars on very high end gear, really impressive facilities, etc... and then expect to get the high dollar accounts because now they have the "stuff they need."

Just buying the stuff doesn't get people to walk into the door. You build a clientele with as little as you can, and then as a project dictates the need, you invest.

2 - Purchasing a building or leasing a space because it's "cool and what will attract clients" regardless of the fact that it comes with a pretty high overhead. That puts you behind the 8 ball right off the bat.

Any space can be very cool and inviting to a client with some nice paint, a few toys and comfy chairs. You don't need that ultra chic Soho loft with the $1,000 chairs and all the fancy furniture trappings that come with it.

You need to find a space within your means, home for many people, and purchase equipment as a job requires it or if you see a very strong need arising in your company. "Build it and they will come" might be nice for a baseball movie, but in real life, it's better to have them coming and THEN build.

Walter Biscardi, Jr.
Editor, Colorist, Director, Writer, Consultant, Author, Chef.
HD Post and Production
Biscardi Creative Media

"Foul Water, Fiery Serpent" featuring Sigourney Weaver coming soon.

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Richard HerdRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 21, 2010 at 12:49:55 am

How do you manage the time between needing a gadget and the 6 weeks for shipping? That is, a client and project give you the green light for a new gadget, but the factory will take 6 weeks to ship it. Meaning, you can't serve the client for at least 6 weeks.

Thanks!


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Arnie SchlisselRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 21, 2010 at 1:48:30 am

[Richard Herd] "How do you manage the time between needing a gadget and the 6 weeks for shipping? That is, a client and project give you the green light for a new gadget, but the factory will take 6 weeks to ship it. Meaning, you can't serve the client for at least 6 weeks. "

Depending on the gadget, a rental house may already have one. If so, rent it for the job. Or another shop may have one, if so, farm it out. If not, well, that's when we need to be upfront with clients.

Arnie

Post production is not an afterthought!
http://www.arniepix.com/


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walter biscardiRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 21, 2010 at 12:27:31 pm

[Richard Herd] "How do you manage the time between needing a gadget and the 6 weeks for shipping? That is, a client and project give you the green light for a new gadget, but the factory will take 6 weeks to ship it. Meaning, you can't serve the client for at least 6 weeks."

You build a relationship with a really good VAR who gets you a demo product within a matter of days. We've done that on multiple occasions when we needed something quickly. They will demand a demo unit or used unit just so we can do the work and then the one we actually ordered gets here when it does.

I've used the same VAR for 95% of my purchases for the past 6 years or so now. They do whatever it takes to ensure we have the products we need when we need them.

Walter Biscardi, Jr.
Editor, Colorist, Director, Writer, Consultant, Author, Chef.
HD Post and Production
Biscardi Creative Media

"Foul Water, Fiery Serpent" featuring Sigourney Weaver coming soon.

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Alan LloydRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 21, 2010 at 5:58:12 pm

You build a relationship with a really good VAR who gets you a demo product within a matter of days. We've done that on multiple occasions when we needed something quickly. They will demand a demo unit or used unit just so we can do the work and then the one we actually ordered gets here when it does.


And that is a wonderful thing.

There are times when I simply have to deal with places like B&H. The savings can not be bypassed. Still, there are a couple local vendors I maintain good contact with for just that reason. If I order something and need it before it gets there, they'll help me out.

And when I can, I also send others their way for the same reason.


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walter biscardiRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 21, 2010 at 6:52:29 pm

[Alan Lloyd] "There are times when I simply have to deal with places like B&H. The savings can not be bypassed."

I do bypass the savings. Pretty much on every order. I would never get the personal service from B&H that I get from my VAR and on the couple of large orders I made with B&H I had problems. I am happy to pay a little extra on each order to keep up that relationship with my local VAR.

Especially when things go wrong, or the product doesn't work as expected, like my recent fiasco with the i7 27" iMac. My VAR dealt with Apple to get the full refund and order me a new Core Duo 2 iMac. All I did was hand him the box back, he is dealing with everything else and will bring the new iMac here when it's in.

If you want to really build a relationship with a VAR, you buy everything you can through them. I even order simple things like Apple DVI adapters from them.

Walter Biscardi, Jr.
Editor, Colorist, Director, Writer, Consultant, Author, Chef.
HD Post and Production
Biscardi Creative Media

"Foul Water, Fiery Serpent" featuring Sigourney Weaver coming soon.

Blog Twitter Facebook


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Richard HerdRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 23, 2010 at 6:01:39 pm

WOW! Thank you!

Can you plug your VAR? I also googled the term "value-added reseller."


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walter biscardiRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 24, 2010 at 2:53:54 pm

[Richard Herd] "

Can you plug your VAR? I also googled the term "value-added reseller.""


I deal with the WH Platts company and their Atlanta Rep, David Strupp. (pronounced Stroop)

whplatts.com

Walter Biscardi, Jr.
Editor, Colorist, Director, Writer, Consultant, Author, Chef.
HD Post and Production
Biscardi Creative Media

"Foul Water, Fiery Serpent" featuring Sigourney Weaver coming soon.

Blog Twitter Facebook


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grinner hesterRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 20, 2010 at 1:24:07 pm

The key to success has always been to bring in more than your expenses... enough to turn profit. That has less to do with what ya spend and more to do with what ya bring in. I stay small not because I don't wanna make more money, but because I don't wanna work more. We can kid ourselves inbto thinking we can deligate as we grow. We can to an extent but I'm hear to tell ya, the bigger the studio gets, the more work the owner will do, regardless of what that work is on any given day. Make it big enough to feel like a real job and, imo, it's easier to just get a real job and finance that pimp that calls himself my uncle.



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Rick TurnersRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 21, 2010 at 10:54:09 pm

whatever is bringing in the amazing clients that MPC, The Mill and places like Envy in London attract is the key..

So...

good sales reps?


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cowcowcowcowcow
grinner hesterRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 22, 2010 at 3:26:04 pm

reputation.



There is also what I call Neiman Marcus syndrome. Many like to go to the best, not because it's the best but because it is the most expensive. Those marking up by percentage can mark up more at these places and those with budgets they have to drain to get the same budget next year LOOOOVE to over spend.

About 20 years ago, I was making wedding videos. I noticed all the low balling and decided to go the other way. While other companies offered multiple packages for different prices, I went to one package at about three times the amount of anyone's lowest bare bones package. What happened? Bookings galore. Did I do anything different, video-wise than I did when charging a third? Not a thing. I simply attracted rich snobby country club mothers of brides that came to me not for a video, but for bragging rights.
You could say some think a product is better because it's more expensive. I think they just wanna tell folks how much they spent.



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Milton HockmanRe: Keeping a Studio Small...The Curse of Big Studios..
by on Mar 23, 2010 at 6:41:02 pm

can you share how you advertised to get these clients? be good to use in my freelance gigs (not wedding video market)

Freelancer Designer Virginia - StephenHockman.com
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