Stay calm and shoot. Forecasting where the final production cost of a film project will land needn’t be a hair-raising experience. Production service companies (PSCs) have built-in safeguards to manage budgets. These can amount to cost savings that make physical production a smooth ride for foreign producers. There are no such guardrails for producers who choose to rely exclusively on an individual fixer or local line producer in a foreign country.
Mutual Investment Wins The Job
“They expect you to do things for free nowadays,” notes the Head of TV & Film at PSN Spain & Portugal, Yousaf Bohkari. And only PSCs are positioned to dedicate their in-house resources to select projects before payment. “Foreign producers are not always prepared to start spending money when they seek our support. So we’re often asked to prepare a location deck, a shoot schedule, or even a budget at no charge,” continues Bohkari. “A production service company has the muscle to take the risk for projects that show promise.”
“Producers would wind up spending more money by hiring an individual rather than a company,” elaborates EP Owner and PSN UAE & Saudi Arabia Partner, Shane Martin. “In order to service it right away, a line producer would have to employ freelancers working at freelance rates. I’m not going to charge them producer daily rates for 15 days quoting. I’ll absorb much of those costs in order to win the job.”
Added Value Between Line Items
Our PSN Turkey Partner approaches long-term projects with flexibility. “If a foreign producer flags the line producer wage plus company fee as too expensive, we might offer to absorb the line producer salary in our company fee,” says EP Chad Ozturk. “In the end we can find a model that works for both parties.”
Foreign producers reaching an agreement with a PSC have the added comfort of knowing the success of their filming rests on the broader shoulders of a company. “Our core members have been together for 20 odd years. We are hand-in-glove in terms of how we operate,” shares EP Viv Esterhuyse at PSN South Africa. “If somebody is ill, for example, someone can step in for a couple days seamlessly. I would venture that it is definitely beneficial to be engaging with a company with that kind of cohesion.”
“You always get added value because once we’ve agreed on the budget, I’m making sure that we’re delivering a great service,” elaborates Johnny Dabeet, EP and PSN Jordan Partner. “I own the production office, but there’s also an equipment warehouse and a life support warehouse where we have tents, chairs, everything you need on set in the desert. So even if I charge a little for my warehouse, I bring most everything anyway.”
Work Like A Local With Vendors
PSN production service company Partners from Thailand to Ireland caution foreign producers from trying to contract local suppliers directly.
“Its quite shortsighted to come here and try to forge your own relationship with vendors,” says PSN Thailand Partner and EP, Fred Turchetti. “They don’t really realize that people on the ground here have long-term relationships which go back in some cases 20 years.”
There’s a tight-knit community at the heart of most international film hubs. “We’re very used to being able to deal directly with people. It’s a system,” reveals EP Dara McClatchie, the PSN Ireland Partner. “A lot of commercial companies will try and get a fixer to do stuff on the ground here. I don’t touch it, I just stay away from it. And I end up getting a call from Panavision saying, ‘We’ve had this fixer on about this job. I’m just letting you know we’re not going to do it because we don’t know them. We know the fixer, but we don’t know their client company.'”
Where trust secures equipment rentals, volume lands discounts an individual line producer can’t compete with, says PSN Canada Partner and EP, Mathieu Dumont. “We have one of the best discounts in town. That’s because we spend way more than what an individual line producer can spend by himself in any given year. So the vendors are more willing to discuss rates with us. We enjoy a relationship that a line producer can’t match.”
Those relationships can translate into added value on an epic scale that fills the screen. “Not every job is a favor job,” notes Esterhuyse in Cape Town. “When you’re an established production service company bringing a lot of work through the door, whether it’s for equipment suppliers or casting agents, it just makes it that much easier when you do need to ask for a favor or a squeeze or an extra mile. The relationship helps immeasurably.”
Look no further than what the team at PSN Czech Republic achieved for Jo Jo Rabbit. “It looks like it could’ve cost $50M,” says EP Owner, Kevan van Thompson. “But our company tapped into Prague’s vast and deep pool of vendors to craft deals that slashed local production costs to under $15M.”
Cash Flow Is Fundamental
“Nothing happens out here without paying for it so a line producer would need to be cashed up big time to even begin to be operative,” emphasizes PSN UAE Partner, Martin, in Dubai. “For instance, locations have to be paid in advance, and they can be big money if you want somewhere iconic like The Burj Tower we secured up front for Mountain Dew. They also want insurance certificates. They want to know that you’re covered if something goes wrong.”
“If you want to book equipment rental, or do casting sessions, all of these things require good relationships with the suppliers and also liquidity,” affirms Martin. “They expect quick payment.”
Dumont at PSN Canada agrees that most of the productions his company supports need the backing of the service company just to be able to start the projects. There are expenses to cash flow before the foreign producer’s first payment reaches his bank account.
“We’re real financial partners,” states Dumont. “I can start things up for my client without waiting. That really helps avoid lost time while contracts are being signed.” While the producers of commercial projects know his company fee is more than worth the cost, Dumont is keen for film and television producers to realize the production service company’s overall advantage over a local line producer in Canada.
“The American studios usually create their own Canadian company with a Canadian bank account. They normally hire a Canadian line producer to manage the project. By working with us, they’ll find that structure already in place. The accounts are already open, and the insurance is secured. This can only fast track the launch of the project.”
Digging into the details reveals unexpected efficiencies and savings when working in accordance with local laws. “If you respect everything you’re going to spend a lot of time creating your corporate structure. And this has a cost. It’s not true that it doesn’t cost anything to create a company,” flags Dumont. “It’s time you’re going to pay people to create that infrastructure for your project. Your line producer will also have to hire and pay a percentage to a payroll company to manage wages and worker compensation. So are you really saving down the line?”
PSN Uruguay Partner and EP, Nico Aznárez, concurs that PSCs streamline and expedite the process. “We’re not waiting to receive up front payments to kick off a production. The line producer would need cash in hand for direct payments,” he notes. “That’s nothing to say of the eventual need to wire money to more than a hundred different people in a foreign country, ensuring financial procedures and paperwork are in place for each one. Working with the PSC, the foreign producer’s company simply wires the money to us. We’ll prepare the wrap so all is accounted for.”
Transparent cost control is a central topic of our next instalment of this series. Look for helpful revelations about local taxes and film incentives you can bank on.
More insights on the advantages of working with a trusted production service company (PSC) are at your fingertips in articles already published in this series.
Access Is Everyting In Foreign Film Destinations
Trusting A Local Partner In The Production Trenches
PSCs Cut The Friction When Filming Abroad
Line Producer or PSC – A Rethink (from the UK perspective)
