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396 HARVARD BUSINESS REPORTS
that an opportunity to cancel them would present itself. Sometimes the exhibitor had contracted for too many pictures and had not had time to exhibit all of them.
When a distributor's salesmen called at the beginning of the selling season to sell the pictures to be released during the ensuing year, an exhibitor frequently took advantage of the desire of the salesman to make sales by attempting to force cancellation of some of the pictures on his previous year's contract. If the exhibitor was in a particularly strong bargaining position, such as that of being the only exhibitor in his zone, he often was able to cancel several of the pictures included in a previous contract before agreeing to purchase any of the new pictures. If he was competing with other exhibitors in the same territory for the pictures of a distributor, he found it more difficult to secure cancellations than if he operated the only theater in the territory.
Most distributors, if they were able to sell an exhibitor pictures to occupy as much of his playing time during the new year as they had during the previous season, did not look upon such cancellations as a loss of business, except for accounting purposes. They knew that the exhibitor had only so many days in a year in which to show pictures and that if all that time was taken up, the mere substitution of new pictures for old pictures was not a real loss of business. Neither the number of sales made during the year nor the number of cancellations had any influence upon the number of pictures to be made, which was determined by other factors.
Overbuying on the part of exhibitors was believed to be one of the causes of the demand for cancellations. Overbuying resulted in part from sales pressure exerted by the distributor's salesmen. It frequently, however, was the result of a deliberate attempt on the part of the exhibitor to overbuy. He did this to protect himself against nondelivery by the distributor. Many times a distributor, after announcing a program and selling to the exhibitors a specified number of pictures, would decide not to make some of the pictures sold and would cancel them from his program and from the contracts he had made with exhibitors.2 As a result
2 The Standard Exhibition Contract, used by all distributors that were members of the Motion Picture Producers and Distributors of America, Incorporated, provided :
"In case the Distributor shall be delayed in or prevented from the performance of this contract with respect to any of the photoplays herein specified by reason of