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TIM RITTER'S PRODUCTION CORNER #11
DISTRIBUTION PART IIRather than go through the madness of self-distribution, I’d recommend finding a distributor for your movie. Chances are slim that you’re going to get an advance, but there’s a huge advantage to securing a distributor these days: you can have the best of both worlds.
What am I talking about? Well, it’s really quite simple. You can go through the process of self-distribution even if you’ve signed your movie with a small distributor and save yourself lots of aggravation, expense, and heartache.
Let me clarify what I mean: say you sign up with XYZ Distribution. You give them exclusive rights to your movie. There’s no advance money and the profits are split 50/50. What the distributor does is this: he comes up with an advertising campaign, he makes thousands of DVD copies of your movie to sell, and he tries to push it into the chain stores. What you have to understand about most distributors is that your movie is only going to be in the limelight as a “new release” for 4-8 weeks, at best. Even at the small indie levels, this is still based on a business where the customer comes into a store and asks, “what’s good and new that I haven’t seen before?” Trust me, I managed a video store for many years, and if I had a dollar for every time someone came in and asked this question, I’d be very rich. Same thing works at the retail level, for books and films, when you’re vying for a consumer to purchase your product. Everyone only gives a “new release” so much time in the forefront. So if your title doesn’t sell like McDonald’s flap jacks in the first month, well, it’ll probably get buried or moved to the side, or “lost in the shuffle,” as some call it. Does that mean that the distributor will stop pushing your title? No! What it means is that it didn’t connect with the public in a timely fashion, so everyone’s moving on to the next thing. It doesn’t mean that it won’t catch on as a “slow-selling cult movie” or that a chain won’t give it a second look after it goes through the long review processes, but this reality of the business does tear up a lot of filmmakers, making them “badmouth” their distributors or quit in frustration.
So what’s the answer? Well, in the same way that I outlined how to self-distribute your movie, team up with the distributor and help him out! No one is going to go out and promote you and your work at any level more than yourself. So here’s what you do: buy copies of your own movie from the distributor and sell them at conventions, through your website, at flea markets, and anywhere else you can think of. Hit the stores with ‘em. Mail review copies out. Do everything you would do just like you were self-distributing! You can do this at your own pace with a very small investment. The distributor has footed the biggest bills (duplication, replication, advertising) and now you’re giving things that extra zing! You can usually buy copies for wholesale (or less) from your distributor, and he’ll be more than happy to sell copies to you as long as he’s making a little profit for himself. You must keep the retail price of your tapes or DVDs at the same level as your distributor for this to work. You must work with your distributor a bit and make sure you’re not stepping on each other’s toes, but being proactive in the process can really benefit everyone involved. You will then see how hard it is to sell these titles and how much work it is to do. And if your movie bombs, you’ll know you did everything you could have to get it out there. If you’re lucky enough to get a buyer from a chain interested in your movie by sending them a copy and doing the legwork, it’s great to just turn it over to the distributor, who then steps in to seal the deal in a timely fashion. He has to worry about bar codes, taxes, shipping, return policies, and all the other things that come with the territory. You know that the deal is happening and how many units they want to purchase, so there’s nothing to do but wait for your split. I’ve seen this work many times in recent days and have done this myself a few times.
What’s so cool about this “proactive method” is that you don’t have to cough up thousands of more dollars to get your movie out there. You simply buy copies and help about as you see fit. You must tell the distributor you plan to work with him if you decide to do this. Don’t just spring it on him, talk about it in the stages before you sign a contract. If you do a lot of horror conventions and shows, this is a great way to make profit back on your title. People love to buy directly from the filmmaker, especially if you can autograph the item for them. And you don’t have thousands of dollars to make back. Just hundreds, depending on how many copies you purchase and what the price was. So I would highly recommend doing this method as opposed to complete self-distribution. It’s better to try and cover every base at once and this is the way to do it.
Finding a distributor can be difficult. That’s where your press kits, trailers, and reviews can come in handy. That’s why I suggest a few early showings at theaters or in film festivals no matter which route you plan to try. Then start talking to established filmmakers about deals they have gotten. Haunt video stores for recent releases of titles that are similar to yours. See who the company is that released said title. (There’s usually web addresses on the back of the boxes.) Look ‘em up on the Internet. Start mailing out your materials and screener copies. Connect with the “acquisitions person” at each prospect. See what they say. Here’s where your going to get an idea about how commercial your movie is. There will be criticisms. Some distributors will suggest changes, adding this or that. Taking this or that out. Re-editing. Don’t take offense to anything they say, take it with a grain of salt. Listen and learn. Decide for yourself what you want to do. If you didn’t “film-look” your movie, they might offer to do that for you. This is where pretty much anything can happen, when you’re shopping for a distributor. Expect long waits---remember, these guys are assaulted with hundreds of screeners a year, whether they’re big or small. Don’t expect overnight offers. As great as you might think your movie is, let's be realistic and humble. We need the distributor, he doesn’t need us. If he doesn’t get our movie, oh well, there’s a couple dozen others behind you that can be marketed in a similar fashion.
Advances are a rarity in this business. An advance means that you get money up front when you sign the contract and you have to wait until that amount is recouped by the distributor through sales of the movie before you “share” in the profits. If you get an advance, that’s probably all the money you will ever see from the distributor, EVER. So make sure the advance pays your budget back if you’re lucky enough to get one.
Some distributors offer an “advance” and then pull the rug out from underneath you. The “advance” is money you actually never see! Basically, they say “we’re gonna put $10,000.00 up front into fixing up your movie, filmlooking it, fixing the sound, etc.” Don’t fall for this---it’s a con job and a way to never give you a penny for your movie. They usually have all the equipment in-house and pony up phony “receipts” and “bills” that make sure they keep every dime that your title earns. I do know a few filmmakers who have gotten advances that cover their movie’s budget, so it does happen. If you have a recognizable name actor or actress in your movie, this can get you a small advance. Not always, but sometimes. Usually video advances are $3,000.00-$5,000.00. So if that covers your budget, well, you’re in good shape!
Negative pickups are rare. They can happen, though. A negative pickup is simply where a distributor buys your movie outright for “X” amount of dollars and they own it for an agreed upon timeframe. Usually, the filmmaker doesn’t share in any of the money that the movie generates. Occasionally, you might be able to negotiate 10% of the profits after the pickup fee is recouped by the distributor, but don’t expect to see any additional funds. Once a distributor gives you money, count your blessings and move on! Especially if you’re lucky enough to get a deal like this.
Another advantage of going with an established distributor and working with them is the foreign sales market potential. It’s nearly an impossibility for a filmmaker to make these kinds of connections without attending all the various film markets. And again, do you want to make movies or spend years trying to distribute? So by signing up with a distributor that has these kinds of connections already in place, there’s the potential to make more money. One decent foreign deal can reap you more profit than years of self-distributing or even getting your movie through a chain superstore! That’s why it was so important during the editing stage to make Master tapes of your movie with the music and effects track only, cutting out all the English dialogue. Some foreign markets will want that tape converted to a different format (usually SECAM) so they can add a foreign language on the dialogue track. You will also have to supply a dialogue sheet (with every improvised word that an actor speaks!) to the distributor, but think about it. One video tape and some dialogue and you can get thousands of dollars back. The foreign markets go in cycles. There’s no guarantees on this and usually buyers are very picky regarding quality and content. But a distributor who’s a good salesman with good contacts will be able to do something for you. Decent markets include Germany, United Kingdom, France, Italy, Japan, Korea, Spain, and Canada. Again, you can never predict if there’s potential for this, but all of my movies, over the years, have ended up in foreign territories. Sometimes, once your movie builds a following in the U.S., foreign interest will start. This can sometimes take many years. Other times, your movie might really catch on in the foreign markets and then slowly catch on in the United States. But always keep this in mind, even if foreign sales for shot-on-video movies are as shaky and unpredictable as the stock market. The potential is there.
You can sign your movie up with one distributor for U.S. sales and another distributor (or foreign “agent”) for overseas sales. Sometimes this works, usually it doesn’t. I’ve found over the years that it’s best to find one good distributor to handle worldwide sales. Otherwise, they might feel that you don’t believe in them and do a poor job of selling your movie. I’ve seen this happen on quite a few occasions. Filmlooking your video movie is usually a prerequisite for getting any foreign sales, although I did have two video movies that sold quite well overseas just as they were.
New markets are always coming and going for all movies, even video productions. As the digital quality gets better and better (along with the affordability of purchasing or renting equipment), there will continue to be new possibilities. There are websites that carry your movie for consumers to download and view on their computers for a fee. This is becoming more and more popular, although I don’t see any huge financial prospects for this until everyone has their modems digitally connected. Still, it remains another possible outlet. Here’s where your trailer will come in handy again, as most of these web movie sites let consumers download a free “preview” or “trailer” before purchasing a view.
Pay-per-view, especially satellite, is another possibility. As prosumer equipment improves, I think this will become a bigger possibility for decent revenue for distributors and filmmakers. Still, you need a certain quality here. Rarely does a Hi-8 or Digital 8 movie make it into these type of outlets. It’s mainly for movies that are shot with DV cameras that record with a “film-like” process of 24 frames per second. We’re talking digital beta cameras (or dockable units) which run $60,000.00 a piece or more. Renting these type of cameras is an option for the indie filmmaker. Sometimes you can find a production company that does commercials or an independent videographer that has one of these babies and make a deal where they shoot your movie on deferment, so keep that in mind. Also, depending on how well you keep up the quality of your production (lighting, sound, clear picture, etc.), Pay Per View is always an option because TV channels are starving for new product. Especially stuff with a good story and good suspense. Not extreme gore epics.
Once you find a distributor that you’re interested in, find out everything you can about them while you’re waiting to hear back from them. Contact other filmmakers that have had movies sold through them. Asking for specific figures is generally regarded as pretty rude and obtrusive (not to mention most filmmakers are likely to lie about what they made), so keep your questions reasonable. Was the filmmaker happy with the job the distributor did in promoting and marketing his movie? Were royalty payments made in a timely fashion? Did they keep in touch with the filmmaker throughout the process, or did they “disappear” after the contract was signed and become “too busy” to talk to him? Is the distributor receptive to the filmmaker buying copies of the movie and helping to get it sold? How many years does the distributor want exclusive rights to the movie? What kind of promotion does the distributor do for the movie---over the Web, in magazines, advertising, etc.? Does the distributor have an ongoing relationship with buyers at video chains? And the list can go on forever, but these are the basics. If the answers you get from the distributor (and filmmaker references) seem good to you, then the next step is to enter into an agreement, or “contract,” with the distributor, if they want exclusive rights to sell your movie.
My first piece of advice is to be very clear with things that you want in the contract. Hash out everything you expect from the distributor and put it in writing. That way everyone will be happy with the deal and there will be no misunderstandings down the line. Also, have a lawyer look at what your signing, no matter what. I wouldn’t sign anything without at least having a reputable attorney look at it and give you some feedback. He may see something you didn’t. It’s worth the money spent (usually about $150.00) just to ease your mind, especially if you’ve put a lot of blood, sweat, and tears into your project.
Every distribution contract is different, so I’m not going to show a copy of a sample form. Some are very reasonable in length, only three or four pages. Some are only one page. The more tightly written and shorter the contract, the better the deal. There’s simply less to hide. I have dealt with distributors that have thirty, forty, and fifty page contracts, and all I can say is, it’s always turned out to be a bum deal. There’s too many “loopholes” and “ands, ifs, and buts” hidden in there for my taste, so use extreme caution when someone offers you a contract that’s thicker than the phone book. Get an attorney involved from day one.
There are, however, some basic things that most contracts cover. I’ll go through those now and offer my insight on what’s worked best for me over the years. The first thing is the title of the movie. Usually the distributor reserves the right to change the title if they desire to do so. Up to you on this, if you’re in love with your title, you better spell that out in the clause. Sometimes a title’s already been used and patented by someone else (or registered through the Motion Picture Association Of America, the only way to legally protect a title, since a title cannot be copyrighted. It takes a hefty yearly fee to keep the title registered, too). So have an open mind with this clause, I’d say.
Next up would be the “time period” that the distributor expects to have the full rights to sell your movie to various markets. It used to be seven years was the rule of thumb. Nowadays, it’s not uncommon for a distributor to want your movie for ten years...twenty years…or forever. That’s right, many distributors want to pick up the right to sell your movie as long as they are in business.
Bad thing or good thing? At first glance, you might say, “horrible, I’d never do that.” But let’s look at that a little closer. How many companies have distributed a title like, say, Night Of The Living Dead when the rights expire for a certain distributor? Suddenly, it’s “public domain” (yet the filmmakers still have the original copyright!) and everyone is selling it…and the filmmakers and original investors aren’t receiving a dime. I purchased Night on no less than five separate video labels over the years and the same thing has happened with the movie on DVD. It’s very costly to hire a lawyer to go in and make all these companies stop selling your movie---and it happens to smaller films, too, not just cult classics like Night.
As I mentioned, once you relinquish a Master tape to a distributor, you rarely get it back. They might fold, sell out to another company, or just give your Master to someone else after the contract expires. Then that party might start selling copies of your movie, illegally. It’s happened to me MANY times. Especially when you sign a five or seven year contract.
Let’s backtrack a bit. Once you sign the contract, how long does it take for your movie to come out? Is it immediate? No. Usually it can take six months to a year before your movie even comes out! That’s right, it takes a lot of time to get the publicity wheels turning, to get the movie hyped, to get the movie reviewed, to create an ad campaign, to get it listed in catalogs, brochures, and other places. Then there’s the expense of making dubs on all the various formats and sending out screeners and the whole nine yards. There’s also a four month leeway period that most magazines require for publicity. So you have to understand, just because you sign a deal doesn’t mean the movie is coming out immediately. Works the same way in the publishing industry. It takes about a year to get a book published and out into the market after you’ve signed the contract. That doesn’t count the time you spent trying to find a home for your material!
So my advice here would be to get a clause put into the “time period” section of the contract that the movie must be released within a year of signing the contract, otherwise it will be automatically voided and all rights revert back to you, the filmmaker, with no monies owed to the distributor (in case he claims he was getting ready to release the movie and had spent dough on flyers, this, and that). The bottom line is this: some disreputable distributors will sign your movie up and SHELF IT, that’s right, NEVER releasing it because they see it as competition for something THEY MADE. They just want to tie up your movie in a contract for many years while they release their own stuff. I’ve seen this happen many times and I’ve talked with distraught filmmakers that have had just such a thing happen. So if a distributor is really going to release your movie, it should be within six months to a year, and they shouldn’t balk at a little clause that says it’ll be on the market within a year. After all, they’re asking for some timeframes, so why shouldn’t you?
Now the issue of how long should they keep the rights comes up. If you decide to give them the rights forever, the word “forever” should be defined. What would be the definition? To me, as long as the distributor is doing business. If they sell their company, that’s one thing. The right to sell your movie should be part of the package. However, if they go out of business, again, the rights should automatically revert back to the filmmaker and that should be stipulated in the contract. No one stays in business “forever,” especially these days. There are distributors that have been in business for many years 20, 40, whatever. That’s fine, they’re stable. But it still doesn’t make them invincible. Their line might be disconnected tomorrow. Cover yourself.
If you’re leery of signing your movie over to one company forever, give them at least ten years. As I said, it takes a long time to get the ball rolling, up to a year. Give them time to make deals, to sell your product. Everyone is operating on a budget, so be realistic. Don’t expect billboards to be up on Interstate Highways touting your movie. Give the distributor time to do their job. It’s a rough market. Sales are hard to make. Competition is fierce. Work with them on sales and do what you can to assist, as I mentioned earlier. There’s nothing more annoying than a pushy, whiny filmmaker that thinks they’re the next Spielberg with a video camera. Having this type of attitude will get you nowhere. So get your timeframe in the contract and let the distributor and his people work their magic. In the meantime, you can be talking up your movie, continuing to hype the upcoming release. Positive word-of-mouth is one way to help sales when the movie is finally released. Give an update on things every month on your website.
Regarding the timeframe…if you get good references from other people who have dealt with the company, the right to sell the movie “forever” doesn’t seem that bad to me. One of my early movies went through the “rights expiring” thing with one company and I made deals with other companies at the appropriate time and it became a real nightmare!. Suddenly three or four companies were selling my movie with different boxes! It’s hard to legally fight this, because your original distributor (who no longer has the rights) will simply say “these copies were made before our contract had expired. We’re just selling overstock.” Even if you KNOW they are lying…uh, proving it and going to court in another state to rectify things isn’t as easy as it sounds. The expense involved is astronomical and even if you win, you’re out a bootle of cash. You can hire a lawyer to send the offending company a “cease and desist” order and this will sometimes work…but more often it does not. The company will just change names, open up as a “wholesaler” (claiming they bought the items from someone else) and it’s almost impossible to prove. To annoy you further, they’ll give the Master to other “lowball distributors” and they’ll do their thing with it. So here’s where it might be a good idea to put in the contract that your Master tape should be returned when the contract is over---but that still won’t stop anyone from making sub-masters and doing the same thing. Is it really that bad? Yes. At this level, the FBI and the MPAA do not give much help to independent filmmakers who can’t even afford to get a rating in the first place (which is how the MPAA stays in business). There’s all kinds of rules on what is considered “piracy” too---specific numbers for renting and selling and you need documented evidence and who wants to deal with all this anyway? So that’s why, in one way, the longer the timeframe you give the distributor, the better off it is, in some cases. Especially if they’re a decent and honorable company. Good distributors have lawyers on staff who will protect your little movie from the cannibals who do this kind of thing and if they know they have your movie in their library forever (or 10 or 20 years), they’re not going to let someone steal it. That’s one of the benefits of going with a distributor as opposed to doing things yourself and then signing on with a distributor later.
So think about it. A lot of companies (even Blockbuster!) are getting movies that they want to keep in their libraries for twenty years or more. And I’ve seen firsthand why---if everyone is selling the movie without the right to do so, all at the same time, how much money do you think YOU’RE going to get out of all this? Just what you think: NOTHING. Look at it this way, if it can happen to George Romero, it can happen to anyone. It happened to me, and it was (and still is) a real disappointment.
One thing you can put in your contract is that the distributor has the “exclusive” rights to sell your movie for so many years, and after that time period, they still have the right to sell your movie forever but you can also make new deals with other companies. That is being done all the time now, although, to me, it kind of defeats the purpose of having one company focused on selling your movie. Why do you want to compete with yourself? Unless it’s a short film that you made (maybe part of an anthology) that you may want to put on a future DVD release as an extra, I can’t see why you’d want to do this with a feature movie.
After seven or ten years, unless you have some sort of cult hit on your hands, there’s not much sales life left for your movie anyway. Sure, new formats come up (I’ve seen Beta, VHS, 8mm, two laserdisc formats, and two DVD formats in the last 18 years alone!) but unless you’ve made something that stands the test of time (a true rarity in the shot-on-video world), ten years ends and your title is pretty much history, especially if you’re trying to find a new company to do something with it. Granted, a lot of older horror titles are emerging through new companies that are acquiring the rights for DVD, but no one is getting rich off of all this and most of them were shot on film. If you’re already WITH a good company that is looking to make deals for your movies and seize opportunities with new formats, you’re much better off, in my opinion. (Look at Tempe Video, for example, and what they’re doing with all their old shot-on-video titles.) In my experience, switching distribution companies too many times can be more harmful than helpful. It’s not ALWAYS the case, but it is USUALLY the case. So think about that when deciding how long to tie up your movie with one distributor. There are pros and cons.
Although you probably won’t get an advance payment for your movie, the next area of concern in a contract would be the way you get money back. The distributor will usually split what’s called the “net profits” with the filmmaker. Rarely does anyone split “gross profits” with the filmmaker because there are expenses that the distributor must cover that should be taken right off the top. For instance, the packaging, artwork, duplication, replication, and shipping fees. Usually this is taken off of each unit sold. In other words, if a DVD sells for $20, the distributor takes off a certain amount of that sale for his manufacturing costs, usually anywhere from $3.00-$6.00. This is fair. Then they’ll split the net profit with the filmmaker, which would be $14.00-$17.00. Standard agreements are a 50/50 split, and since I’ve already outlined the expenses and overhead that a distributor has, this is more than reasonable. As a matter of fact, it’s rare to get any other type of deal these days. With the rising costs of shipping, phone bills, health insurance, payrolls, artwork, and mastering tapes, you can see why the distributor SHOULD take 50%. He’s not getting rich off of your work, he’s simply taking an honest amount for his hard work. You can make sure that a cap is put on how much a distributor takes off for his expenses, that would be a good idea. But don’t say that the distributor is “robbing you” for taking a certain amount for manufacturing and half of the profits. If you’ve ever tried to self-distribute, you’ll know exactly what I mean.
The next order of business might be the payment schedule of your royalties. Usually, payouts are made to the filmmaker quarterly (every three months) or bi-annually (that’s twice a year). Distributors are usually late when making quarterly payments, anywhere from a week to a month. Don’t panic when this happens and don’t threaten to sue them. This is actually reasonable because as I mentioned before, they are set up with things called “revolving accounts” and many times, they are waiting for a wholesaler or a retailer to pay them so they can pay you. As long as the distributor keeps you updated on what’s going on, BE PATIENT. Yes, you signed an agreement, but you can’t squeeze blood out of a turnip, as they say. If the terms for payment from a rackjobber were 180 days (6 months!), you might have to wait a LONG TIME to get your money. The rackjobber has to calculate sales, ask for credit on items being returned (if your title didn’t sell) and then cut the distributor a check. That money has the clear and then the distributor can cut you a check. Once you see how this works, maybe you’ll be a little more understanding in why payments take so long or get held up. A good distributor will keep you posted on what’s going on and should even send you a statement of moneys “pending” to come in from deals like this, but don’t be too pushy. It’s a slow market, it’s business, and that’s the way the cookie crumbles. You should also put a clause in the payment schedule that states you have the right to hire an independent auditor to check the distributor’s books after a certain time if you feel that you’re being ripped off. You want to cover yourself, but you don’t want to be unrealistic, either. Most distributors should be fine with this. And although you might sleep better knowing this clause is there, you have the right to do this anyway, whether it’s in the contract or not. I might add that this audit process is an extremely time-consuming and expensive venture to undertake, so unless you suspect the distributor is hoarding huge amounts of cash, well, it basically isn’t worth it.
Another myth is that when your movie ends up in one of the big chains, the filmmaker has hit the “big time” and is rich. The reality of it is, the more units you sell to a chain, the lower they pay for each tape or disc. Some DVDs (without extras) are retailing for $6.00, so you can bet the chains are only paying $3.00 or less per unit. Most chains only have 500-3,000 stores total, so quickly do the math. At best, it’s a $9.000.00 gross, minus expenses and shipping, so the filmmaker might be getting $3,000.00-$4,000.00 TOTAL for a national rollout of 3,000 units. And that’s a BIG sale, the average chain commits to maybe 1,000 copies, making your profit margin even smaller. Still, it’s not bad if you kept your budget down. And that’s just one chain, there’s more stores and foreign deals and all that jazz, plus all the other avenues I’ve mentioned. If you can make your budget back from a chain, you’re doing well. I won’t argue that the exposure is great and it’s a super accomplishment to get your movie out there in the “big league” and competing with Hollywood titles. Just don’t think everyone’s “getting rich” because a title is “visible” in stores. The returns policy I spoke of can also hurt profits.
Rounding out the rest of the distribution “biggies” in a contract would be the “legal action” and “materials” clauses. Basically, the “legal action” clause is just one that makes you, the filmmaker, responsible for any litigation that occurs from something that happened during production. In other words, here’s where you better make sure you have all your location releases, music releases, actor releases and anything else pertaining to the movie you’ve made. Some distributors will ask for copies of every single contract you have entered into to make your movie, and this is not unreasonable. They just want copies on file for their records. In a sue-happy world, be prepared to provide all of this. Even if the distributor doesn’t ask for this material, the filmmaker is still accountable for everything in the movie when this clause is in the agreement. This liability clause also sometimes asks for an “errors and omissions insurance agreement,” but that’s basically for bigger movies with a budget. It’s pretty much the same thing I mentioned above, but if you have a budget, you hire an agency to check out every aspect of your movie to make sure that everything is signed and there’s very little chance of being sued. They double-check and second-guess every aspect of your production, from character names (making sure that no real person has a name close to your fictional characters and can sue for improper implications!) to the title of the movie, it’s all checked and then backed up with an insurance policy that will cover any legal expenses that come up if any lawsuits arise regarding content of the movie. Again, most no-budget movies don’t go to this extreme. This policy alone usually costs way more than a $4,000.00 video movie.
The “materials” clause just states what items you are expected to deliver to the distributor upon signing the contract. It should include the format for the edited video masters, an edit with just music and effects, screener submasters, trailer(s), photographs, press kit or material to create press kits, a synopsis of the movie, and whatever else you have that the distributor might be able to utilize in selling your movie.
Something else to think about when signing a contract with a distributor is to keep certain things for yourself. Keep the right to make a sequel or a remake of the movie exclusively to yourself. Make sure you keep the right to use the characters again. Keep T-shirt and other ancillary markets open. You never know what might happen with your movie or if a big-budget remake might become possible, so spell these rights out and hang onto them. You can give your current distributor a “first-look” offer on a sequel, but don’t give everything away until you see how the movie does. Look at the success of Evil Dead, with all the lunchboxes, action hero dolls, models, toys, posters and everything else that were spawned from the original release. A distributor should be compensated for their work, but you shouldn’t give away the store, either.
Again, keep in mind that even the best of distributors can’t force viewers to want to watch your movie. It’s a long road and frankly, it can take anywhere from four to ten years for even a small project to break even on its original budget in some cases. I’m talking about a small budget here, too, under $5,000.00. No matter what, you have to prepare to deal with your movie for at least a decade and keep pushing, keep helping the distributor any way you can, as long as it’s not counterproductive to what they’re trying to do. Don’t blame the distributor if you’re movie doesn’t catch on. If everyone tried their best and the whole project sinks, well, hopefully you haven’t bet the farm (or mortgaged the house) on its success and you can take a break and eventually get back on the horse to try again. No one can force consumers to buy or rent your movie. Making a creative connection with an audience---especially at the underground level---is very difficult to do. If there was some secret formula in a bottle to ensure a Blair Witch type success, everyone would have it and would be using it. Be realistic in what you expect. The goal is to get your project out there, get your foot in the door, make a little bit of money (hopefully your budget back), and move on to the next thing---hopefully something at a higher level with a bigger budget. Use your movie as a stepping stone to the next project.
The things to remember are: research your market, research the distributors, and contact people that have dealt with any distributor you are considering. Get more than one opinion on the distributor. Weigh all the information in your mind. Make your choice. Keep it in mind that the distributor is actually becoming an “investor” in your movie. Many times, they spend as much (or more) than you did making the movie in order to get it out. Be selective but don’t take TOO long, there’s always someone that has a movie that could replace yours. Competition is nipping at your heels. Happy hunting and good luck!