Harvard business reports (1930)

640 HARVARD BUSINESS REPORTS committee conducted the negotiations with the two distributors, it negotiated individually for each separate theater, set prices individually, and signed a separate contract for each theater. This action had been necessitated by the attitude taken by many members. Several members refused to buy or use the pictures of these two distributors upon which most of the other members had agreed. Most of the members did not entirely trust the methods of the committee and preferred to pay for their pictures in terms of an exact price set for each theater rather than in proportion to such percentage of the general contract as would be determined by the committee. Many members listed on their requisitions for the pictures of these two distributors prices below those at which they themselves normally could buy. Such action, of course, made the negotiations with the distributors more difficult, and forced the committee to negotiate with the two distributors theater by theater. The distributors themselves preferred to conduct negotiations with each theater as a unit. Contracts, however, were satisfactorily completed. A comparison with the contracts of the previous year proved that the prices for every theater were the same or lower than in 192 7-1 9 28. In no case were they higher. A number of the theaters secured better runs than they had been able to get in 192 7-1928. After several months of activity it became apparent that the association would be unable to continue because of lack of earnest support on the part of members of the association.3 A meeting was held on September 21, 1928, at which it was decided to disband on December 1 and relieve members from their obligations under the operating agreement. Commentary: Two particular issues arise in this case, the first relating to the adequacy and the use of the information requested by the Independent Motion Picture Exhibitors' Association, the second relating to the causes of the failure of the experiment. It may be noted that the association had final jurisdiction in all matters relating to the buying of the pictures. This was wise. The association also proceeded properly in its attempt to analyze the film contracts for previous years. It showed, too, excellent judgment in its attempt to obtain a report on other conditions which affected each particular theater. It may be noted, however, that full confidence 3 See Independent Motion Picture Exhibitors' Association, Incorporated, page 616.