There are two major components to an indie film budget: above the line and below the line. Above the line typically includes the fees paid to the writer, director, producer and cast. Below the line is everything else you need to buy or rent to make your production run, including post-production.
The largest expense on most indie productions is payroll for cast and crew. In addition to the rate you negotiate for each person, you’ll need to include fringes, which typically include taxes, workers compensation insurance, payroll fees and union expenses.
Most indie projects need “named talent” to raise money, which means you’ll be employing SAG (Screen Actors Guild) actors. SAG has multiple contracts with different rates depending on your budget level.
In addition to the rates defined in the contract, you’ll need to add fringes. I estimate about 47% in fringes, which breaks down to about 30% for taxes, workers comp, and payroll fees, in addition to the Pension and Health (P&H) dues of 16.8% for SAG. What that means is, for every $1 dollar you pay an actor, you’ll have about 47 cents in fringes. There are other fees that SAG charges a production as well, such as travel expenses, wardrobe fees, meal penalties and overnight penalties. Make sure you discuss these fees with your rep at SAG so you’re not surprised with extra expenses at the end of the production.
In regards to non-union crew, I typically estimate about 30% in fringes, which includes taxes, worker comp and payroll fees. Here’s an example:
If you budget $150 per day for a production assistant (PA), it will actually cost $195 per day, calculated as follows:
$150 PA day rate x 30% fringes = $45 fringe expenses
$150 PA day rate + $45 fringe expense = $195 total PA rate per day
An additional $45 per day might not see like much, but a typical indie production runs about 25 total days. So, you would be adding over $1,125 for run of show for one PA ($45 per day x 25 days = $1,125 total additional cost).
In addition to cast and crew expenses, there are many other costs associated with production. Each expense in the budget gets a “line item” that is tracked and “actualized” at the end of the production to see how well you did.
Here’s a list of below-the-line expenses:
- Production Staff: unit production manager, assistant directors, PAs
- Camera: director of photography, assistant camera people, camera rentals, tripods
- G&E: gaffer, grips, lighting rentals, extension cords, stands
- Locations: set rental, holding rental, restoration expenses
- Production Design: production designer, props person, art supplies, props
- Hair and Makeup: hair and makeup staff, kit rentals, wigs, SFX makeup
- Wardrobe: costume designer, dressers, clothes, handbags, jewelry
- Sound: sound mixer, boom person, microphones, mixer, headphones, batteries
- Production: tables, chairs, office, paper/ink/toner for scripts/sides, catering
- Transportation: truck rentals, gas, tolls, parking, repairs, taxi
- Insurance: production insurance, workers comp, stunt insurance
- Editorial: editor, hard drives, studio rental, music, color correction, sound mix
- Contingency: Typically a percentage of estimated overage
To get a more detailed list, check out Film and Video Budgets, Fifth Edition by Deke Simon. You can also review Simon’s free budget templates, which are really useful for first-time producers.
You’re now ready to assemble your budget. The best way to begin is to find out how much the producer wants to spend on the production. Your budget must total this amount, not a penny over.
In the indie world, a producer can’t afford to go over the budgeted amount because the investor is an actual person (e.g., a family member, local business person, arts lover) and not a studio. So to honor a budgetary number is equivalent to honoring your word.
To start out, get quotes from at least three different vendors and compare their offerings line by line. Another way to keep prices low is to hire crew that has their own gear. You can negotiate a flat price with them, and crew usually has a good handle on what is needed to complete a film successfully.
Keeping the vision of the story, staying organization, and communicating concerns are essential to keeping the production on time and under budget.
(Edited on May 6, 2014, at 6:41 pm to include the Editors’ Note.)