The Martini Shot: The balancing act of negotiation
by Bobby Amm. One of the important activities of industry associations is to facilitate negotiations between their respective members. This is especially relevant in an industry which comprises thousands of freelancers, is subject to the pressures of supply and demand, and requires detailed and accurate quotes to be sent to clients at short notice.
Talent rate guideline
The Commercial Producers Association of South Africa (CPA) recently reached an agreement with the National Association of Model Agents (NAMA) and the South African Performing Artists Managers Association (SAPAMA) on a guideline to change the way the service industry pays day rates and usage fees to talent —an important step in ensuring the sustainability of the industry, as international clients have long complained that SA’s talent rates make the country uncompetitive. NAMA and SAPAMA were very responsive to this concern and, with invaluable input from the casting directors, came up with the new proposal.
After some tweaking, the guideline, which essentially increases day rates while simultaneously reducing usage fees, has been welcomed by the industry and, so far, the feedback from production companies and clients has been very positive indeed. Although artists may be losing out on higher usage fees, the increased day rates (and hopefully greater number of international jobs incentivised to come to SA as a result of this deal) should act as a strong incentive to artists looking for a more-consistent income. It is hoped that this will also help to attract newcomers to the industry, thereby growing the talent pool.
Negotiations between industry associations are notoriously challenging, and require give and take on both sides; however, there is a certain satisfaction in finding a solution that works for everyone and, most importantly, is good for the business. Negotiations do, though, come with a natural expectation that everyone concerned should abide by the outcome, which is impractical in SA’s free-market system that outlaws price fixing and market manipulation.
While guidelines assist production companies to pitch and quote confidently and crew and talent to expect rates that are market-related and fair, the CPA’s position is that everything must remain negotiable and robust competition between competitors is essential for the promotion of a healthy and sustainable industry. From a legal perspective, competition law dictates that an agreement between parties in a vertical relationship (clients and suppliers) is prohibited if it has the effect of substantially preventing or lessening competition in a market.
For this reason, it is important for industry associations involved in negotiations between vertical supply chains to make it very clear to all concerned that their recommendations are in no way binding and that negotiation on costs is strongly encouraged in all circumstances. Associations and their members must also be able to show that their relationship is beneficial to the economy and that there are gains that outweigh any anti-competitive effects, as the onus will be on them to prove this, should accusations of impropriety arise.
SA’s growing legislative framework places more pressure on our industry to do things by the book; however, it’s encouraging that associations are still in a position to engage in constructive discussion on how to move forward in the collective best interest of the industry and in good faith. It’s something we hope to see more of in the future.
Bobby Amm is chief executive of the Commercial Producers Association of South Africa (CPA), the trade association of production companies that produce television, cinema and internet commercials for the local and international market. After a brief stint in journalism, she began her career in the industry at the Consultative Committee for the Entertainment Industry in the early 1990s. She first joined the CPA in 1997 but left three years later to join a production company. After finding that she missed the big-picture perspective of the CPA and the interesting issues which continuously perplex the production industry, Bobby returned to the CPA in 2003. She contributes “The Martini Shot” column monthly, covering developments, trends and insights into the commercial production and film services industries in South Africa, to MarkLives.
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