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Creative projects on a fixed budget?

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Nicholas GreeneCreative projects on a fixed budget?
by on Oct 18, 2013 at 4:06:17 pm

We're a video production company in Brooklyn and have been working with a client for almost a year, with a healthy relationship - but every time they bring us a project, they claim to have a fixed budget. The company is a worldwide branding and product design agency that works with Fortune 500 companies; the videos are used as internal selling tools to help forward a particular strategy.

I understand they need to know in advance exactly how much something will cost so they can budget with their client - and we don't over promise what we can deliver. Production is fine; but with the editing, as ever, there is back and forth and revisions and other "small changes" that eat into our time and make the project less viable by the end.

For the upcoming project they have a fixed budget of $5000 and want us to create and edit a 3-5 min video, shooting a consumer product testing workshop, with various interviews. The 'storyline' for the video needs to express their findings from the workshop and help support their broader recommendations. The shoot is simple, but there will be 4-5 hrs of material to edit. Since the video needs a specific argument based on what they learn at the workshop (i.e. after shooting), I've suggested they provide a specific outline before editing - which could reduce the creative pressure for us and hence the number of revisions. But this might be a challenge for them, so I would have to re-shape it all anyway.

My questions -
How do you put a cap on a project that, by nature, has a developing creative?
Given this is an agency relationship, what's the best way to tell them "your client needs to pay more" when the video is not essential to the overall project, and could be dropped.
How do you charge for small things (changing a lower third, swapping out shots etc) at the end of a project when the budget was fixed months before, without holding the project to ransom?

Any advice would be highly appreciated!

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Mark SuszkoRe: Creative projects on a fixed budget?
by on Oct 18, 2013 at 4:55:47 pm

I think if you try to charge a la carte type schedules for things like revising a lower third, you'll lose your mind. The beauty of the hourly rate is that it should mean equal access to "all the toys"- i.e. whatever you have in the shop that can contribute to the project, it's all available under the same rate.

Do you charge the same rate for logging/ loading into the system, as you do for the actual edit? Often, places will charge less on the logging, but for a project of this nature, the logging step is actually the first draft edit, because you have to look at everything and make decisions on which raw segments go in and which don't. Everything after this initial weeding-out-the-junk step is going to be refinements and re-arrangements of stuff chosen in the first raw "edit"/ intake session.

To put it another way, the first draft of just raw selects is an additive process, like building up a clay sculpture. The edit rounds to come after this will tend to be subtractive: shortening, tightening, carving away the unnecessary bits to leave a tight, narrative core. Does that subtractive process go slower than the first, additive one? For me, no; the first chunk is the slowest and hardest to do. Do you charge a lower hourly on tha first pass or not? The quality of the logging job you do on that intake step will have a huge effect on the efficiency of all that happens afterwards.

More to your point about "capping" the growth of the creative... breaking the thing into fixed progress points with a defined metric is what protects you. You'll often hear of jobs billed in thirds: a down payment to start, a progress payment at a stage like first rough draft, and a final payment after the revised master is approved. You *could* cut that up finer into more segments, more waypoints or milestones, whatever you want to call it. Then attach a percentage of the expected expense to each. This way everybody has a better sense as they go along, if the time is outstripping the available money, and the client can see for themself if there is room in the schedule to keep adding more "gold plating" or alternate versions or whatever.

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Mike SmithRe: Creative projects on a fixed budget?
by on Oct 19, 2013 at 9:26:51 am

Why would you want to add extras to a project you've agreed a fixed fee for? Is there a hint of having your cake and eating it here ...?

Surely your challenge is to manage the project to keep it within the parameters set in the budget, and to flag early and clearly to client if you think you can reasonably say you are being asked to go beyond what's agreed.

Working to a budget is nornal for a producer, and many clients are utterly reasonable about the point that we're reaching the boundaries of budget here, we need to contain the small things to stay within.

Sounds like you're lucky to have such a good client.

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