What the Client Owes The Producer 2
The Client Must Be Committed to Obtaining a Successful Finished Product
Premise: The client must be committed to obtaining a successful finished product. This involves honoring payment agreements as per terms of the agreement, written or verbal (I suggest written).
Money problems. Producers have them, and clients have them. But chances are the client's company has more money than the producer. Sometimes, a ton more.
Some people get rich running a production company, but most don't. It's a service business, and the biggest problem is always having jobs lined up to follow the one you're currently producing. Depending on the size of the company, this doesn't always happen. Sometimes, a job is so large and so important that it's all hands on deck.
So it's the client's job to keep the skids greased. They must provide information, props, product art, interview availabilities, and more in a timely matter. But that's for the next entry. Here, we're talking about money.
Most producers stage out their invoices in three parts: One third to begin, one third after completion of a significant production milestone (scripting or shooting), and one third at the successful conclusion of the project. The producer's terms may be 15 days, 30 days, or "Please Pay on Receipt". Sometimes they'll require a downpayment to start, and then allow net terms for the subsequent installments. The client company's terms, however, might be something entirely different.
There is the financial aspect of money-- funding the necessary activity to keep the project on track. But I think the more important aspect is the motivational aspect. Prompt payment is a sign of respect for the producer. It alleviates worrying about the next payroll, payroll taxes, subcontractor money demands, having to front the money for equipment, props, actors, and more. But most importantly, prompt payment pushes the client to the top of the list. You want to work harder, more creatively, and spend more late nights for a client that makes your financial life smooth.
Some companies are flexible about their own internal rules regarding payment terms; others are not. I remember one company (a major multinational) who insisted that suppliers (at least creative suppliers) plan on waiting 40 days for their money, including start-up billings. Was this simply to inflate the "cash on hand" on their balance sheet? I don't know; there was no explanation, and no exceptions.
However, a client at another large company that was a brand name in the consumer goods world would "walk the invoice through" and even offer to overnight the check if it was necessary. They understood the nature of creatives.
Early on, we had a client that had ridiculous deadlines on a series of videos for the education market. We did one a week for at least a dozen weeks. We worked late nights. We got the job done. They had negotiated a discount on our production fees since we were guaranteed 12 weeks of work in a row. But payment was slow. We were barely taking salaries in those days, and we already had people on the payroll. Attitudes soured as paychecks slowed. I remember late one night in my non-air-conditioned audio "suite" when for the first time I yelled the phrase, "If you love me, pay me!!!!"
Eventually, they did.
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