What is bidding?

[Guest Chad MacKenzie]

I'm still learning all aspects of Production. In this book I'm currently reading about commercials, it says on some projects that the producers bid for them?

 

What exactly is bidding, I don't understand it!

 

 

Thanks

[Alfeo Dixon]

Bidding is the actual process of estimating the cost of doing the job. A budget is set forth to the production company based on the treatment/script submitted.

 

Pretty cut and dry...

[Brian Dzyak]

I'm still learning all aspects of Production. In this book I'm currently reading about commercials, it says on some projects that the producers bid for them?

 

What exactly is bidding, I don't understand it!

 

 

Thanks

 

 

Just to add to that, as in any competition, the lower price usually wins. The client will generally want a specific product (the commercial to look the way they'd like it to) and various ad agencies will compete for the job. Each company must figure out how they would approach the logistics of accomplishing the goal and then arrive at the lowest dollar amount they feel they can do it with and still make a profit.

 

So there are "real" costs (what the hard numbers are that really can't be negotiated, like film stock, equipment, and crew) and then the profit margin added to that. If a Producer wants to maintain his profit but get the budget lower, he will go to those hard costs and try to negotiate lower prices from vendors and individual crew members. What that really means is that people will be earning less money for their work... everyone except the Producer.

 

Anyway, each competing agency works up their own estimates and submits the bid. The client may not go for the lowest price automatically if they feel that a higher priced agency/Producer can provide a better end result even if it does cost a little more. Sometimes art does triumph over money, but everyone is still out to spend as little as possible at all levels in order to earn more profit overall.