Video Production Services: Advice for Startups

Mark Bosko
January 1996

If you've decided to take your video production services to the next level and actually turn your talent into a business, good for you. But before you get started, be aware that there are plenty of snags out there that have been the end of many a new video production services business.

What follows are some rules, tips and hints that will help you steer your fledgling operation away from potentially dangerous waters.

Rule number one: Don't mix your business and personal finances.

This is an extremely important point. When starting up a new video production services company, many people figure it's not worth the hassle to open a separate checking account for business purchases and deposits. Fact is, it's worth the hassle and more.

One of the first problems that arises from not having separate accounts is the eventual "loan" that will take place. It may come from business proceeds to finance personal pleasures, or vice versa, but it'll happen.

As a purveyor of this practice, I found myself in a jam when I tried to write a check for a cable client's airtime. The client had written me a check two months prior that included both his production costs and the spot's airtime charge. I, in a serious lapse of judgment, had used the extra cash to finance a weekend trip with some friends

. When the check bounced, the cable company bumped his ad. The commercial promoted a sale the client was running. By the time the spot got back on the air, the sale was over. The client demanded a refund. My image and wallet were both bruised.

Video Production Services Rule two: Balance your checkbook.

We're not all mathematicians, but balancing a checkbook must be in your repertoire if you want to run a successful business. In addition to risking bounced checks, service charges and irate clients (see above), an unbalanced checkbook indicates mismanagement. You must organize your time and activities.

Video Production Services Rule three: Keep records.

All those annoying receipts that clutter your car ashtray and pockets must be filed and retained for bookkeeping purposes. The information from any transaction within your business, be it income or an expense, is vital to the final accounting for that year. All balance sheets, tax returns, income statements and profit/loss analysis comes from this data.

And while we're on the subject: if you don't know bookkeeping, hire an accountant. I unsuccessfully tried to "keep the books" for my first year in business. When tax time rolled around, the CPA I hired to file my refund just laughed at my record-keeping system. The additional charges incurred to straighten out this mess certainly cost more than if I would have had a part-time accountant go over my books once a month.

At the very least, hire someone to get you set up. Or try one of the many computer-assisted software programs available. But approach this task in a knowledgeable manner by reading everything on the subject and asking others for advice.

Don't buy what you don't need.

In my case, some trusting benefactors invested a sizable chunk of cash in my business to get me started. Let's just say my ambitions were higher than my experience level.

To make a long story short, I was, and am now the proud owner of several pieces of equipment whose technological glory has never seen the light of day.

Before making any equipment decisions, do your homework. Keep in mind actual needs. For example, if most of your shooting will take place outdoors, don't invest in a state-of-the-art lighting set. It might be nice to have a light or two, but you really don't need a professional-level kit.

Maybe deposition taping is your gig. These tapes usually need minimal editing with no effects. An A/B-roll editing system with 3-D transitions is overkill. Equipment is an investment to earn money. If a piece sits around for months untouched, you're losing money on the investment.

Before buying anything, check out trade magazines for used gear. Often, you can get nearly-new demo pieces for a fair percentage off their original costs. Ask if a new equipment warranty is included. For jobs that are very intermittent, consider renting the needed equipment or sub-contracting the job to another production house. It'll save you a capital investment and more if the job is a one-time deal.

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