Creating a Business Plan

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A business plan is different than a specific film proposal targeted to investors, although it can be used in such cases to demonstrate the solidity and goals of your company. Following are items that are useful to include in a business plan:

Mission statement (what is the purpose of your company) Company structure and operations (who is running the show and how)

Company goals and objectives (how many projects you intend to complete, how much revenue you expect to gain, etc.) Description of planned films or other projects Budgets and schedules for proposed films/projects Projection of potential income and funding sources Marketing and distribution strategies for proposed films/projects

So how do you put all of this information together? Many people start with a mission statement, which defines the vision of the company.

Mission statements are intended to provide a sense of purpose and long-term direction in daily activity. Typically, a mission statement defines a company by describing what it does. Disney's simple mission statement, for example, is "to make people happy." Frey Hoffman of Freydesign Productions has a clear mission.

"My mission is to work with not-for-profit public interest groups. It's not exclusive but for me those groups represent an enduring value to the community at large, which is what I want to contribute toward."

Filmmakers often become so intent on the minutiae of a particular project that they neglect to look at the big picture of where they are headed as a company. Sometimes they don't think they need business tools as they are in a creative field where such things shouldn't apply. But whether you are making steel beams or independent shorts, a focused company mission will help you stay focused on your goals.

Here is another example of a mission statement. The Australian International Documentary Conference (AIDC) provides a market place for documentaries for national and international buyers and distributors, showcases the work of Australian and international documentary makers, and creates a forum to discuss content, craft, technology, and future directions. Their mission statement reads:

"To stage a recurrent international documentary event that is both an inspirational conference and successful marketplace, promoting and furthering the interests of Australian documentary and its makers."

Once you have created a mission statement, the next step is to develop specific goals that support your mission. For example, two of AIDC's goals are to:

. foster professional development for documentary content creators by providing access to critical debate, analysis, and an energetic forum for the discussion of important issues facing the documentary community;

. foster industry development by providing a networking and deal-making forum to develop markets for documentary in conventional and emerging technologies.

As you can see in the above example, the mission statement describes the overall purpose of the organization, while the goals are much more specific about the actual functions. As a film production company owner, your mission statement will probably entail a description of the type of film projects you want to produce or clients you hope to solicit. A mission statement should not be created for marketing purposes but to reflect your personal vision of the company. If you create a mission statement that seems generic, it might be an indicator that you have not spent enough time thinking about what makes your company unique.

Following are some questions that will help you define your mission statement:

. Why are you creating a film production company?

. Who is your audience or client base?

. What image do you want your company to convey?

. What media services (if appropriate) do you provide?

. How does your company differ from others already in existence?

. How is modern technology (if appropriate) going to help support your client base?

. What philosophies or values does your company uphold?

Again, your company goals should specifically describe the actual products or services you plan to provide. For example, to:

. produce three 30-minute documentaries a year on topics that enhance people's understanding of serious environmental concerns, or

. provide high-quality, low-cost post-production services to nonprofit organizations and educational clients.

One of the toughest challenges of putting together a business plan is the budgeting aspect. How can you possibly predict your potential revenue when just starting out? If your company is client oriented, it is obviously easier as you can use your rate card, calculate the approximate (and realistic) jobs you hope to secure, and draw numbers from that. While it is easy to estimate expenses, it is much harder to anticipate earnings for "creative" projects, especially as it can take years to reap any revenue, if ever. Anticipated revenue sources for these budgets have to include investors, sponsors, grants, and "outside" income from other sources of business, like commercial work. Chances are (and I know from experience) that you won't be completely on the mark with your budget in the first year or two, but as your business grows you will begin to understand realistic expectations and be able to budget accordingly. Regardless, the budget you create will give you concrete financial goals to aim for, as well as an understanding of what is going to disappear from your account.

There are a number of good books on developing business plans and film proposals, such as Filmmaking & Finance: Business Plans for Independents, by Louise Levison. However you form your business plan, it is important to review and update it as your company grows and changes. Focused and realistic goals will help keep you from getting sidetracked. Some filmmakers even post their company goals by their desks so as not to lose sight of the "big picture."

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Business Brains

Business Brains

To Build Your Business It Is Crucial That You Have The Correct Info And Tools And Learn How To Build A Correct Business Plan! This is one area you must pay attention to… There are many areas of a business plan that you may not know about but need to know about. For instance... you may have no idea about an executive summary.

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