Mind Your Business: The Sport of Negotiating

Sung to the tune of Jack Norworth’s and Albert Von Tilzer’s Take Me Out to the Ball Game, with apologies:

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Mark Simon trying to get a base hit in negotiations. [1]

Negotiating and bidding commercials doesn’t have to be such a hard thing. It just takes teamwork. Just like in baseball, if only one team is playing, the score can get run up.

Everyone wants a great job. Clients want to receive great work, and production companies want to provide great work. That’s why so many commercial negotiations begin with, “I want this spot to have Disney feature quality animation.” (Feel free to substitute the terms “Pixar” or “DreamWorks” for Disney) That is normally followed by the production company’s response, “O.K. Great. That normally costs between $1 to 1-1/2 million per minute of animation.” Which is then usually followed by a long silence and sometimes the sound of a body, or at least a jaw, hitting the ground.

Think about it. An 80-minute animated feature by the Disney studios costs on average around $120 million to produce. Simple math tells us that equals $1.5 million per minute ($120M/80). Plus, that doesn’t even count the amortization of overhead costs for four years.

The statement most often heard next is, “Well, we don’t really need to perfectly match the Disney quality.”

Of course, fantastic animation can be produced for much, much less, but large budgets are still a reality in the game of top-notch animation production with lots of effects.

In the second inning of negotiations, the client comes back and says they don’t have anywhere close to that kind of money. (Sounds familiar, doesn’t it?) You can keep throwing out numbers, but they won’t mean anything unless you and your client get together and go to the ballpark.

They need a ballpark figure from you as to the range an animation could cost, and you need a ballpark range from them to determine what needs to be designed into the production. So let’s get out of the dugout and get up to the plate. As the production company, just ask your client, “Are you in the $10K-$20K range, the $20K-$50K range or higher?” This saves time and helps you swing for the right production budget ball.

Of course, some clients will only have $500 for an animated spot, in which case you need to decide whether you feel charitable or not.

The production company and client have to trust each other somewhat during negotiations. There are so many elements in animation that affect budgets, that unless you know what budgetary game you’re playing in, you won’t know which elements to put in the game.

Which team is providing which players? More clients are providing their own music and sound effects. Which team is casting and bringing the voice talent? Are there live-action elements that you need to be a part of? Which team does the final compositing and editing?

If the clients have a lower budget and you see in the boards a cast of thousands, it’s time to get creative. You need to figure out a way to give them a look that works, and the client has to be willing to make creative adjustments to fit their budget.

Negotiating is more than just trying to get more money out of a project. It’s also determining the needs of the production. Higher budgets mean more options. Lower budgets mean tighter restrictions. Short deadlines mean sacrificing time-consuming effects, but sometimes adding overtime.

The more information a client gives you, the more accurately you can estimate your ticket prices. Don’t fall into the trap of “This is a simple project with just one easy character. How much will it cost for a 30-second spot?” Unless you have a script and boards, there is no way to estimate a cost. Spots are almost never as simple as clients lead us to believe. Once you give an estimate, clients don’t want to hear anything about higher rates regardless of what the final storyboards show. You also don’t want to give a ballpark figure so high, in order to cover all possibilities, that the clients think you are far too expensive to deal with.

The best game plan is to get on the practice field together and work out the storyboards together with a budget range in mind. That way, the production can be designed by the experts to fit the clients’ needs.

As you finalize the budget, make sure both teams know the rules, a.k.a., a list of assumptions. Clear dialogue is the best sportsmanship.

Negotiating is a sport where both teams can win. Then every home run counts for everyone.

Mark Simon is an award-winning animation producer and lecturer who is also the author of Facial Expressions, Producing Independent 2D Character Animation and Storyboards: Motion in Art. He can be found lurking around at www.FunnyToons.tv [2] and may be reached at Mark@FunnyToons.tv [3]. Mark’s books may be found and purchased at www.MarkSimonBooks.com [4].