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PokerMagic New user 66 Posts 
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Hi there,
I am looking for help as I have been approached with a different kind of contract. I am going to use general numbers here just to get my point across, any help would be appreciate as they are awaiting my proposal. They would like to do something with revenue sharing and a minimum guarantee. Here are some rough numbers I am working with: Essentially the average ticket price will be $13 and there is a capacity of 300 people. which equals a total sale of $3900. I was thinking of asking for a guarantee of at least $1200 and/or 70% of the ticket sales - whichever is greater, that is for the first show. For every additional show, it will be JUST a percentage split. It is not terribly far away, a few hours drive so expenses shouldn't be too high. For those who are going to ask - YES - I do have a full show ready to play in a theatre and have done quite a few shows in theatres, however not many with percentages. The reason I am open to percentage is because the theatre has a good reputation of filling seats, however because of a recent flood (which is true, I checked it out) they don't have much in there budget for the next 6 months, due to repairs; Does this make sense or will the theatre say that I am asking for WAY to much. Is 70% of the the sales reasonable? Any other ideas would be good, Thanks guys. |
Jim Snack Inner circle 1338 Posts
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CE123,
I don't have a problem with your idea, although the theater may not want to risk $1200 or give up 70% of the gross ticket sales before their expenses. It depends on their fixed costs. In an ideal win/win deal, the theater and the act would share equally in the profits from the joint venture. For a sold out show, the theater would get $1950, and the act would get $1950. Here's what I would do: First figure out what the break even point is for the theater. Ask the theater manager what it will cost the theater in terms of advertising, box office, front of house and technical staff costs to put on your show. Let's say the theater investment is $2000 for those costs. If your guarantee is $1200, then the total money at risk is $3200. Divided by $13 per tickets and the theater would have to sell 247 tickets (or 82% of the house) just to break even. That's too high. Theater managers like to have the break even point closer to 65% of the house - about 200 tickets in your case. Those numbers would naturally change depending upon the theater's fixed costs, but the deal is weighed in your favor. Like I said, I don't have a problem with that, but the theater manager may. If the theater's fixed costs are $1400, then your $1200 guarantee would not be a problem, since the break even point is now at 200 tickets sold. I like a deal that gives the act a guarantee small enough to cover its expenses, then a percentage split of the revenue over the break even point, and I suspect that's what the theater manager would like. Your expenses are covered, then the theater's expenses are covered, then you split the profits after that. It's hard to make a reasonable proposal without knowing how much the theater's fixed costs are. Before you submit your proposal, ask the manager what that number is and what it covers. Then come up with a deal that minimizes the risk to the theater and rewards you for the risk you take. Of course, if you float the $1200 or 70% of the gross box office and they are willing, then ink the deal. Then work you tail off to fill the house, because you don't want the theater losing money (unless their budget is heavily subsidized with grants or corporate support). Hope that helps. Jim |
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Bradacal Special user 591 Posts
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I think it really depends on the town that the show would be in, because if its a small town, expenses may be low for the theatre in terms of advertising - if its a big town, more might have to be done and thus there B.E.P. might be high.
Lets say for argument sakes its a smaller town, which by the sounds of it, it may very well be. If you are charging $1200 for a minimum guarantee, that would mean you would probably like to get double that if you were charging them a flat fee. Now, if the theatre was to book paying just your flat fee and it flopped they would be on the hook for quite a bit - BUT - if the theatre books you on percentage, and it flops, then it won't hurt them as much as I am sure they will sell some tickets to help with the cost. I would assume that the theatre might be doing more than 1 show, and hope to make more money off the second show; If so, I would offer a straight 50/50 split on a second show which might hook them in. Remember, the theatre is taking a risk by giving you a guarantee - BUT - you are taking a risk in working for free. Sure, your expenses will be paid, but you could end up with Zero in your pocket when its done. The theatre getting 30% isn't terrible for small theatres. Pitch them a 2nd show if you haven't and break it down to them like this: 30% of show 1 = max of $1170 for them. 50% of show 2 = max of $1950 for them. They could possible make over $3000 off you, with not much to risk. Now, it might not sell out both times, but you can bet of the 600 tickets between the two, the theatre should sell at least 400 tickets IF they are as reputable as you say. Jim, makes terrific and valid points, but I think it comes down to the theatre you are dealing with. Hope this helps. Michael |
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Bradacal Special user 591 Posts
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Another point I forgot to make is - using hypothetical numbers here BUT, lets say your flat fee is $2500. Well, if you were to do a 50/50% split with a min guarantee, that would mean the max you can make is $1950, which is less than what your asking price might be. Now, I have no idea what you asking price normally is, I am throwing out that number of $2500, simply because its double what you want for a minimum....but you are taking ALOT of risk to make less than your asking fee most likely - therefore I think 70% might make sense as you should be rewarded for your risk of a little bit more than what you are used too - if you sell the show out of coarse.
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Dannydoyle Eternal Order 21245 Posts
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The points they are making, and are dead on right, it is tough to answer spacifically without knowing what the theater has to put into it.
300 is not a big theater. $13 is not a big price for a ticket. They fill the theater? So they have costs for advertising and such. Once you find out those costs, then you can really nail down a formula that will work for each side.
Danny Doyle
<BR>Semper Occultus <BR>In a time of universal deceit, telling the truth is a revolutionary act....George Orwell |
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Jim Snack Inner circle 1338 Posts
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Bingo, Danny.
Jim |
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Big Daddy Cool Inner circle 1604 Posts
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This is my area. I do this every day. If the theater has a good reputation for high quality, and for consistently selling out shows, has free parking and is esy to get to then you could come away having done well.
You are talking about a two wall, which is my favorite way to produce a show. Never once have I seen a theater willing to do a minimum guarantee on a 2-wall. Granted I haven't played every theater in the country, but I've been in a LOT. Here's how to make it work. Ask for 70/30 of the GROSS in your favor. They will be far more likely to do this than make a gaurantee. Then you take the lead on marketing. Let them do their thing too, but you be even more agressive. If they are willing to give you a minimum guarantee then you should really negotiate a buy-out. if they agree to a minimum on a 2-wall I'll eat my shirt! If you sell 80% of the house at $13 (that's $9.10 to you per seat) you'll gross $2184.00. IF you sell out your gross will be $2730. Now, here's my concern. $13 is way too low for your show - unless that is what the average price of theater shows is there. If that is the case then I question the theater's reputation for quality. A quality theater ticket price is starting at $20 and goes up from there. We have an inferiority complex in magic and somehow believe the tickets have to be given away... This is such a deep subject, some one should write a book. Wait, I did! "How To Produce Your Own Theater Show" is available at theatricalmagic . net! |
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Big Daddy Cool Inner circle 1604 Posts
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Quote:
On 2008-09-16 14:31, Jim Snack wrote: Jim, A 70/30 split is not uncommon in the theatre world. A 60/40 is most common, and the really cheap places will try to negotiate 50/50. you probably don't want to play there anyway. Either way, bring your own tech crew, do your own marketing. For those interested in learning more, I've finally written "How To Produce Your Own Theater Show". Look at my sig line for more info... |
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Posted: Sep 16, 2008 05:48 pm 
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