Exhibitors Herald (Dec 1924-Mar 1925)

28 EXHIBITORS HERALD February 7, 1925 Express Company Plan for Distributing Motion Pictures By MARTIN J. QUIGLEY {Continued from page 25) The larger companies now have a huge sum of money invested in exchange locations and exchange equipment. The saving which the proposed system of centralized distribution would yield them would, over a period, offset the financial investment but it would also cause them to lose strategic advantages which they now enjoy and this latter feature will make them hesitant and apprehensive about the plan of centralized distribution. It appears to us that if the proposed system is to depend upon getting immediate support from the three or four companies now doing the largest volume of domestic business that it will fail. It will encounter a let-well-enough-alone that will be hard to circumvent. « * * The arrangement that appears to be the most promising would be one in which several of the lesser organizations would join. Among these are many subsfantial, sound and progressive concerns and the volume of their business, together with that of several small companies that might be admitted, would approximate the gross revenue of the few very big companies which are not likely to show much immediate enthusiasm for the proposition. In inside office discussion it will be pointed out that under this system of centralized distribution, provided that any responsible individual or company would be permitted to use its service, anyone with a picture — without investment in distribution and without many other obligations that the established companies have been compelled to assume — could go out and compete practically on equal terms. An independent producer could come in and out of the market as freely as he chose and while out of the market he would be under no expense whatsoever. With a picture ready for distribution all he would have to do would be to hire a selling force, or avail himself of independent selling forces that would exist, and commence accepting col be the nominees of the producers distributing through the company.” In a draft of the plan, the company points out nine advantages which will accrue to the producers, declaring that the greater number availing themselves of the service the greater the saving. Following is a summary of the benefits which the company says will be derived : The producers gain the saving brought about by the use and services of the com lections from the express company. It is well enough to say that the biggest companies should have a “let live” policy in practice as well as in theory. But that is not the rule of business in the picture trade or elsewhere. It may be said of the Railway Express Film Transport Company that it appears most promising in every essential respect. The moving spirit is Mr. Irwin who is well-known in the industry, yet completely divorced from it for many years. He is a man of integrity and has had a sufficiently long and general experience with film matters to know definitely the problems of the industry and how they may be approached with hope of success. In interesting the express company in the film transport project he has made the best and probably the only logical connection. The project doubtlessly is well-financed and its financial dependability may be readily assumed on the basis of the officer and directorate personnel and its relationship to the express company. We expect to see the influence of exhibitors lined up solidly behind the plan of centralized distribution. Theatremen are very directly concerned, from the standpoints both of the small matters of service and also from the larger policy issues involved. Under the proposed arrangement, the exhibitor would be dealing with a single central branch office. He would encounter uniform practices and would receive uniform treatment. The plan offers great hope for improvement in promptness and regularity of shipment and better and more uniform inspection. The transport company would not be likely to be influenced by the size or location of the account and a high order of service, uniform to all, might be expected. And in the larger issues concerned with the maintenance of free and open competition the exhibitor will find much which should win his approval and support to the plan for centralized distribution. mon medium “for this saving goes where it belongs — to the producers.” The company will handle the distribution duties which now constitute about 70 per cent of the present cost of distributing and selling. Each producer will continue to employ his own sales force. The new plan will relieve sajfs managers (now termed branch managers) of executive duties, permitting them to concentrate 100 per cent on sales. These sales man agers, the company says, will not be as high salaried as the present branch managers. The company will have its own managers in charge of each exchange. To Employ Expert in Shipping The company will employ a man thoroughly acquainted with the shipping business to supervise shipments either by express or parcel post. C. O. D.’s for rentals and for accessories will be remitted to the exchange by wire, the cost of such telegraphic remittance to be added to the amount of the C. O. D. Under the new plan it is said that it will become possible for a producer to suspend production for a period “whereas under the present conditions the percentage of cost increases by leaps and bounds” if such a policy is adopted. This is made possible under the new plan because the producer pays only for prints shipped, thus eliminating the present cost of distribution. Producers who are compelled to stop production and liquidate would be in a position to continue selling, whereas under present conditions the cost of maintaining a distributing organization would be too great to permit that. The company claims that this new plan would permit producers who have not been in a position to pay dividends to do so “and get an occasional breathing spell.” Another claim is made that in offering a plan which will permit the producers to close their studios for a period “the much talked of evil of the fabulous salaries of stars and directors” will be corrected. Outline Financial Phase Article 5 of the uniform contract to be signed by producer and distributor gives a definite explanation of the operating phase. It reads: “By the service to be rendered by the distributor to the producer, including the operation of said exchange facilities, is meant : “(a) Storage of positive prints in vaults constructed for the purpose. “(b) Conduct of inspection of films department, including proper repair usually performed by existing film exchanges, the keeping of records showing the title of the subject inspected, the number by which the print is designated, the number of its reels, the footage cut out, whether it needs new titles or scenes and such other information as is desirable, and whenever a print is in a damaged condition, the prompt rendering of a report by the exchange making the inspection to producer’s sales manager for the territory in which such exchange operates, stating the nature and extent of such damage. “(c) Conduct of shipping department. “(d) Conduct of booking department; all bookings to be entered as per copy of contract between producer and exhibitor or as per other memorandum furnished by producer, the form of which shall be agreed upon between producer and distributor. “(e) Conduct of bookkeeping department, including the billing and the collecting and depositing of all moneys. “(f) Conduct of the poster and other advertising accessories department, including adequate shelving and other facilities for the care and handling of such accessories in reasonable quantities. “(g) Conduct of any and all other details of a film exchange, except the selling and the keeping of sales records, such as cut-off sheets, necessary for the promotion of sales, and the obtaining of permits or licenses from censorship authorities.” Each producer will share proportionately in “the entire cost of operation and maintenance of the distributor” on the following basis: “ . . . that the share of such cost of (Continued an page 3S)