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Old August 10th, 2007, 08:39 AM   #1
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Promotional Video Contract

Hi!

I am getting into making promotional videos and I'm wondering what I should include in my contract with the client and perhaps some advice on wording.

Since I am just getting started my rate will be $700 per finished minute for a product 1-5 mins in length. 59 seconds or less will cost $1000 and over five minutes will cost $700/finished minute up to five minutes and $500 per finished minute beyond five minutes. This will include shooting and editing. The client will be charged for additional costs (such as large equipment rental, location rental, etc) but such costs will only be incurred with the consent of the client. DVD menu design will cost $15/hour and DVD label & case insert design will be $20/hour. The cost of the DVD duplication & printing, the insert printing, and the DVD cases will also be additional. So my formula for charging for a short promo video will be ($ per finish minute) + (Additional agreed upon production costs) + (DVD menu design) + (DVD duplication & printing, insert printing, and cases).

Does that sound reasonable? How do I say that in a contract? Also, I want to have the rights to use the footage in other projects. How should that be handled contractually?

Thanks a lot,

Dale
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Old August 10th, 2007, 01:09 PM   #2
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So if the client required multiple talent to be shot in multiple locations over the course of say a week, and it took you yet another couple of days to log and capture, color correct, edit and then revise a couple of times, for a 1 minute finished product, you would still only charge $700.00?
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Old August 11th, 2007, 01:11 PM   #3
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I can't comment on whether it's reasonable (though, if it is, I may be in the wrong business ;) ). At minimum, try and locate a form contract somewhere. Contract language needs to be accurate and complete. For example, there are rules of contractual construction that are applied uniformly in most jurisidictions. One of them is: "Any ambiguities in a contract will be construed against the draftor." That means that, if you wrote the contract and there is anything ambiguous in it, the court will read the ambiguity in such a way as to favor the person who didn't write the contract.

I don't like form contracts for a variety of reasons, not the least of which is that they are not specific to any one jurisdiction and, if you start changing, adding or deleting terms it may have unintended consequences. If this is going to be your livelihood, you might want to hire a lawyer on a one-time basis and have him draft a basic agreement you can use with all clients that will reflect your specific requirements.
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Old August 13th, 2007, 08:43 AM   #4
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I don't like per finished minute contracts. You have no idea how many hours it'll take you to finish a minute. You have no constraints on what the client demands to be done for each minute.

You need to see the client's complete scope of the job to begin to estimate the time needed. You can then give an estimate price or a budget ceiling to keep to. You need to consider approvals and possible changes/revisions or the job may never end. You need to consider a payment schedule also.

There are so many factors I wouldn't have time to list them all but, depending on the client, you could be walking into a situation that can cost you significant time, money, your business.
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Old August 14th, 2007, 08:13 AM   #5
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Thanks, guys. The only reason I was planning to charge per finished minute is because I heard that is how a few local guys do it. I am keeping the charge low for now because I have another job and I am developing my video business on the side. Hopefully it will be able to completely support me, but for now I am concentrating on getting experience and building up my equipment. However, maybe I'm going about it all wrong.

Dale
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Old August 14th, 2007, 08:57 AM   #6
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Better to estimate how long the shooting and post product will take including one round of revisions (make sure that's in the contract). You can then figure what you'd like to make per hour and come up with a dollar amount.

I know it's tough to make such an estimate if one doesn't have experience though. Even if you end up undercharging a bit for the learning experience you'll set a good precedent for using the formula (hopefully with better accuracy) in future contracts.

The alternative is to just charge hourly or a day rate but that may not give them a budget they need to work within.

Per finished minute sets a VERY BAD model since a given minute can range from very simple to extremely complex. You may then get people in the future asking why their per minute charges different than someone else's.

Running time is a meaningless comparison especially when a 30 second spot for one client can cost more than a 90 minute presentation for another.

If this is what your competitors do then let them sink and you be the survivor who picks up their business.
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Old August 14th, 2007, 09:07 AM   #7
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Thanks, Craig, that helps a lot. What is the procedure for revision? By "one round of revisions" are you saying that I should come up with a finished product, give it to the client, they ask for any changes that they need/want, and after that it is done - no more changes? Also, I know the importance of wording in a contract. Does anyone have example contracts I could base mine on or other suggestions for making my wording clear, simple, and effective?

Dale
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Old August 14th, 2007, 03:32 PM   #8
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The more I deal with professional contracts and agreements, the more I believe in what I'm about to write regarding competently drafted legal language ...

Legal language should be simple and clear. But if it's one, it's typically not going to be the other.


YMMV.
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Old August 15th, 2007, 09:20 AM   #9
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Dale, I usually include changes as part of the editing time in my contract. How you handle it may depend on the client.

I usually include approximate post production hours (like 40 hours). Of course client must trust your estimate. If post takes 30 hours they have 10 hours left to play with. This way a client can't hand you a "change" that'll take another week.

You can also limit changes to "superficial" content (time code numbers of included material - extending or cutting shots), or changes in text, changes in levels (audio mix for example) to prevent client from including new material.

Other changes can always be included but that involved a "change order" and additional billing.

Including cut off dates for requesting changes is also good as well as defining turnaround time for a change.

There are many ways to handle changes but you must protect yourself from loosing money/time on a job.

It is easy to limit changes to one round (whatever one defines as a "round") of changes though. If client feels the need they can come sit in on the changes and sign off on them. Any changes after that cost more.

My experience is that "changes" can easily equal the entire post production time so and are the biggest gaff in detailing in most contracts so this has to be expressed somewhere. Simply upon "final approval" is DEADLY since it allows for changes forever.

Remember you are a business and if you end up making less than what you need to survive, you'll go under, not your client. Therefore, for me, I toss up my biggest brick walls on changes. Clients had better know what the want.
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Old August 15th, 2007, 05:56 PM   #10
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Whenever I meet with a new client, I always stress to them how much pre-planning and a clear communication of their vision to me can save them money. I stress that changes after production begins can, and will, cost them more money than they budgeted for the project, but they can make the changes, if they are willing to pay for them.

Before I started working for myself in video, I was in sales for about 8 years. If I only learned one thing, it was to set a clear expectation of the product/service and what it will cost. Without a common expectation of the product/production/service you and your client are inevitably going to end up at two different places when it's all over. And that will only lead to you changing things for them, and them being upset that they have to pay for it (or you working for free to fix it, which is by far the worst).

Just my $.02... take a penny, leave a penny...

Kevin
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