Harrison's Reports (1951)

Entered as second-class matter January 4, 1921, at the post office at New York, New York, under the act of March 3, 1879. Harrison’s Reports Yearly Subscription Rates: United States $15.00 U. S. Insular Possessions. 16.50 Canada 16.50 Mexico, Cuba, Spain 16.50 Great Britain 17.50 Australia, New Zealand, India, Europe, Asia .... 17.50 35c a Copy 1270 SIXTH AVENUE New York 20, N. Y. Published Weekly by Harrison’s Reports, Inc., Publisher A Motion Picture Reviewing Service Devoted Chiefly to the Interests of the Exhibitors P. S. HARRISON, Editor Established July 1, 1919 Its Editorial Policy: No Problem Too Big for Its Editorial Columns, if It is to Benefit the Exhibitor. Circle 7-4622 A REVIEWING SERVICE FREE FROM THE INFLUENCE OF FILM ADVERTISING Vol. XXXIII SATURDAY, OCTOBER 20, 1951 No. 42 AN EFFECTIVE ANSWER Speaking before the joint convention of Allied of the Mid-South and Tri-States, T.O.A., held in Memphis this week, Abram F. Myers, National Allied’s general counsel and board chairman, had an effective answer for those who claim that the problem of film rentals is a personal one, for personal solution between the individual exhibitor and distributor, and that it does not properly come within the scope of an exhibitor organization’s activities. This is what he had to say: “Sometimes I am asked, why is all this organization and expense necessary to the conduct of the theatre business? Has not Allied projected itself into private matters which are none of its business? The quick answer to this is that Allied must rely on its members for its support and if they are not satisfied with its activities they can quickly bring them to a halt. But let us consider very briefly just one phase of these activities — film buying — which is most often commented upon by our critics. “In this connection, we must never forget that exhibition not only is an integral part of the motion picture industry, but from the standpoint of investment and numbers employed, it is by far the most important part. Equally, we must not overlook the fact whereas production and distribution are controlled by a comparatively few corporations, with home offices centered in New York, and have a long record of close cooperation through their own trade associations, the exhibition branch consists of thousands of companies, firms and individuals, scattered throughout the United States and belonging to a variety of organizations, some of which have absolutely nothing to do with the others. “Now if the film companies did not hold annual and sometimes semi-annual sales conventions at which the salesmen are filled with grandiose ideas concerning the pictures to be sold, and drilled in all the new selling policies and gimmicks designed to extract the last dollar from the unsuspecting exhibitor, I might agree that our critics are right. But until those sales meetings are discontinued and the salesmen are relieved of the burdensome quotas and strict home office supervision, I shall argue for the right to the exhibitor associations to supply their members with the information and advice concerning market conditions necessary to neutralize the film salesman’s advantage by matching his knowledge. “If it is proper that the film salesman be bombarded with home office propaganda urging him to get higher film rentals, more percentage engagements, more preferred playing time, etc., it seems to me proper and necessary that the exhibitor associations should lay down a counter barrage. “Of course, there are some large circuits with enough buying power and skilled personnel who do not feel the need for extraneous aid in matters of every day theatre operation. We have some of these in Allied. I rejoice that they have achieved this happy state, and so long as they do not exert their power to the injury of their competitors and fellow-members, we are happy to have them. “They attend the film clinics and the meetings, they share their trade information and operating methods with their fellow-members and make copious notes of the information divulged by others. They know that their welfare is bound up with that of their competitors. They recognize the importance of the little fellow in legislative campaigns. And they are painfully aware that when even the smallest competitor goes haywire in his film buying, he sets precedents which will plague all exhibitors . . .” Mr. Myers’ arguments for the right of an exhibitor organization to deal with film buying are sound. His most important argument is that Allied, in dealing with the prob* lem, is following the mandate of its members. And that is how it should be, for the problem of excessive film rentals is first in the minds of all exhibitors. Too often an exhibitor has found out that he has been made to pay prices and accept terms much more burdensome than those obtained by exhibitors in comparative situations. To combat this condition, the Allied leaders long ago determined that the exhibitors should do as the distributors do with other distributors — exchange useful information with other exhibitors. Hence, it has for many years offered to its members the Allied Caravan, a reliable and confidential film buying information service, which enables an exhibitor to arm himself with accurate and authentic information about rental terms in situations similar to his own. This information enables the exhibitor to present a powerful argument when an enterprising film salesman tries to exact from him rentals that are far in excess of a picture’s worth. Through the Caravan, as well as the film clinics conducted at the national and regional conventions. Allied has done much to offset the continuing distributor drive for higher rentals. That its accomplishments are recognized is evidenced by the fact that, at the recent TOA convention, when the smaller exhibitor members revolted against TOA’s inaction with regard to trade practices, particularly film rentals, a number of them cited the fine work done by Allied for the protection of its members. PENALTY SELLING Another who made an effective talk before the joint convention of Mid-South Allied and Tri-States was Trueman T. Rembusch, National Allied’s president, who had this to say on the subject of percentage pictures: “There is a way that the distributors could straighten out a lot of the intra-industry friction and also increase their film revenue. That way is for them to abadon penalty selling — that is selling where the more business the exhibitor does the less the exhibitor keeps for himself, and by adopting incentive selling policies as are used in many other industries . . . Recently Benny Berger of North Central Allied told of a small exhibitor who purchased an A picture flat for $100.00 film rental. The exhibitor went to work, exploited the picture and increased the gross on the picture 60% above normal and after paying additional advertising costs pocketed a neat profit for his efforts. On the other hand another company refused to sell a comparable A picture to this same exhibitor at $100.00 flat, insisting on percentage, and the exhibitor finally yielded to the company’s demands. The picture terms were of a penalty nature which prevented the exhibitor expending additional monies for advertising so he just ran the picture. The film company recived as its share of the receipts percentage earnings amounting to $89.30. It paid out for a checker $30.00 and ended up with a net film rental of $59.30. Another case of a film company so shortsighted as to want percentage rather than money. Is it any wonder there is no enthusiasm in our business? “However, the most regrettable result of the distributor policy of percentage, rather than money, are the millions of lost customers, lost because the exhibitors lacked the incentive to go out and make a sale. Penalty selling of motion pictures is the cancer that has eaten away at exhibition these many years and today is responsible for 90% of the boxoffice lethargy. With incentive selling of motion pictures a new and rejuvenated motion picture industry would be bom.”