The Business of Theatrical Design, Second Edition
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The Business of Theatrical Design, Second Edition

James Moody

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eBook - ePub

The Business of Theatrical Design, Second Edition

James Moody

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About This Book

Written by a leading design consultant and carefully updated with the latest information on the industry, this is the essential guide to earning a living, marketing skills, furthering a design career, and operating a business. With more than thirty years of backstage and behind-the-scenes experience in theater, film, television, concerts, and special events, James Moody shares his success secrets for the benefit of design students and working designers. Topics include:

  • Finding and landing dream assignments
  • Negotiating fees
  • Setting up ideal working spaces
  • Building the perfect staff
  • Overcoming fears of accounting and record-keeping
  • Choosing the right insurance
  • Joining the right unions and professional organizations
  • And more

In addition to revealing how to get the great design jobs in traditional entertainment venues, the author shows designers how to think outside the box and seize creative, lucrative opportunities—such as those in theme parks, in concert halls, and with architectural firms. Providing the keys for passionate, talented designers to become successful businesspeople, The Business of Theatrical Design is a must-read for novices and established professionals alike.

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Chapter 1

What Kind of Business Am I?

When the business world defines “doing business,” it usually means that two or more parties, individuals, or companies have created a relationship in which one party does something the other party wants in exchange for the second party doing something for the first party. All this is memorialized in a contract, which is a legal document, verbal or written, that defines the relationship between two parties. In layman’s terms, a contract essentially means, I will give (or do) something if you do something for me. Furthermore, the way two parties arrive at this end game is that somehow they become aware of each other and learn what each could do for the benefit of the other. That phase of business is called marketing.
When a theatrical designer says that he is not a businessperson but a creative person, I have to control a laugh. The simple interaction of two people, each of whom has something and is willing to exchange it for something needed, is basic to human survival. Once humans decided to divide the tasks of food gathering and preparation, we entered into a “business relationship” with another person or group. I have two birds and you need a bird. I am willing to give you one of my birds if you are willing to keep my fire going until I return from hunting. How is that different from what we do every day to survive? We take money, after we earn it or are given it, and trade it for a bird. We can then look at and listen to it sing or put it in a pot and cook it!
Our services as designers that are given to another individual, such as a show producer, fit this simple analogy. I have chosen to try and earn money by being a theatrical designer. Who wants my theatrical design services? What will you pay me for that service so I can buy food and shelter? All of these, admittedly highly simplistic, examples do not take away from the fact that we are conducting business almost every hour of every day of our lives. So why does it come as such a shock to newly minted designers that they must use business models and tactics to obtain gainful employment?
There are many books to guide you through the start-up steps, including Start Your Own Business, Fifth Edition: The Only Start-Up Book You’ll Ever Need by Peter Shaw (Entrepreneur Media, Inc., 2010) and Small Business for Dummies by Eric Tyson and Jim Schell, Fourth Edition (Wiley and Sons, Inc., 2012).
The advantages of forming a business of your own include:
• Being your own boss
• Controlling your own finances
• Earning more than as an employee (possibly)
• Tax benefits
• Business deductions
The joy, or fear, of being able to control which project you pursue is a key element in all of this. If you don’t care what you work on, then perhaps you should move on to being an employee. In that case, you better hope the company keeps you on for thirty-plus years and then hands you a gold watch. But let’s be realistic: That is not going to happen, even when we have given years of loyal service. It is just not in the master plan of employers in these economic times.
You will earn between 20 and 40 percent more as an independent contracting designer because the employer saves on employee taxes, insurance, and retirement plan benefits. But this larger (some would say inflated) fee should not be viewed as “free money.”
Some things that you may consider to be drawbacks of forming your own business are:
• No steady income
• No employer-provided benefits
• Risk of not being paid
• Liability for business debts
• More complex tax filings
I believe, on balance, that the first list is far superior, and I trust that the rest of this book will support my premise.

Service Businesses

Now let us move on to the question posed by the title of this chapter. What kind of business am I? As theatrical designers, we are in what is broadly defined as a “service business.” Service people include retail salespersons, waiters, accountants, architects, house painters, dry cleaners, doctors, police officers, fire fighters, lawyers, and others. Although a few may look down on some of these “service” jobs, we cannot deny that they are skilled, trained members of the workforce. Are we, as theatrical designers, not highly skilled and trained too? I trust we all agree on the answer.
Some of the above categories of service people are termed “professionals” and others are called “trades.” In general, the distinction is derived from the level of education necessary to gain entry into the field. Where do we, as theatrical design professionals, fit in this hierarchy? Most theatrical designers have attended high school and at least a four-year college program. Many have gone on for a two-or, most likely today, a three-year postgraduate M.F.A. program at a university. A few will bypass the formal classroom for on-the-job training. In either case, most will put in time assisting an established designer before being truly called a professional. On the whole, we are on a par with accountants and architects in terms of level of education. Thus we can truly say we are service professionals.
It has been estimated by Fortune 500 Magazine that 80 percent of the workforce is employed in nonmanufacturing jobs. If you don’t manufacture or build something, then the only other broad category of work is the “selling” of a service, product, or skill. As people with creative skills, we should market those skills to as wide a market as we can. That places us in the category of “service” businesses. By admitting that we are in a service business, we have the right to sell those services to the highest bidder or the one willing to pay our (or the union’s, which serves as the collective bargaining agent for many areas of theatrical work) fees and salaries.
As service providers, we are marketing an intangible. When we shake hands with the person who has just hired us to design something, we don’t hand him a box containing nice new shiny widgets. What we are selling is the perceived belief on the part of the buyer that we can deliver the contractual service at some later point in time. To get to this point takes research, marketing, salesmanship, and business knowledge.
The fact that we must conduct the work we do in a businesslike manner is a revelation for many people within academic circles and for their students as they leave those hallowed halls. But this state of affairs is changing, even if we only admit intellectually that theatrical designers do not create work in a vacuum. Many designers, however, find it very difficult to actually say that theatrical design is a business.
Does this mean that you must run out and rent a store, hang a sign, hire employees, place newspaper ads, and sponsor little league teams? Maybe! But before you close this book right now, consider that when we admit that what we do makes us a business, we are 65 percent of the way to becoming a true professional, because business is largely based on perceived worth. It follows, then, that the remaining 35 percent of the journey is split between the physical property (desk, computer, etc.) and legal obligations (licenses, tax filings, etc.) that must be amassed and created due to our status as a business.

Profit-Making Business

Are we a profit or not-for-profit business? This seems like an easy question to answer. We are all aware of charities such as the Red Cross or our church that qualify as not-for-profit businesses, but what does that mean? It means that they may not show a profit at the end of the year for tax purposes. Does that mean that the employees are not paid? Does that mean that they cannot own expensive equipment and property? The answer is “no” to both questions. So who draws the line and makes the determination as to which businesses qualify for nonprofit status? The Internal Revenue Service makes that determination based on the forms you or your CPA or tax attorney file with the state or city for your business license or the Articles of Incorporation that establish the business (see chapter 6). The IRS then determines the sections of the tax code applicable to the type of business, and reviews your filings based on those criteria.
Well, since I think of myself as doing a community service by designing for a not-for-profit theatre or dance company, why aren’t I able to take advantage of their status? Because the laws and regulations are designed to encourage profit and thus create revenue to run governmental agencies. A charity avoids many taxation issues. But since the government needs revenue to pay for its agencies and services, it makes every attempt to bring in as much tax revenue as possible and thus restricts those who wish to avoid paying their fair share.
When you get into chapter 6, a picture of how this works should emerge. Right now, understand that as a for-profit business you can seek protection from some taxes or mitigate the amount due by taking legal advantage of tax breaks in the codes via allowable deductions to your business, many of which are not available to the private citizen.
Lastly, I want to make it very clear that you must personally verify the advice and statements I pass along when legal obligations are discussed. Not only am I not a trained, licensed attorney, but the laws and regulations change so quickly that you must always have the most up-to-date information at hand to make a sound business decision. I intend to base some parts of this book on personal experiences from forty years of being a professional theatrical designer. I strongly hold the belief that sound business practices must be a factor in our design careers. Throughout this book I hope to give you reasons to join me in bringing a more professional status to our crafts.

Chapter 2

Office, Home, or Studio

A physical location with an address is necessary to begin a business. The IRS uses the term “principal place of business,” which we will discuss later. Now that address may be as simple as a post office box that could cost $25 a month, or it can be at your residential address where you are already paying rent or living free off your parents. But for most people an office implies at least a single room in a commercial building. Office space can go for between $0.75 and $10.00 or more per square foot. A small 8 x 10 office is not terribly expensive, and there are businesses that specialize in catering to the small start-up business that needs a short-term rental. They do get a premium for being flexible, but often the offices, at least here in Los Angeles, come with some furnishings, Internet lines, and occasionally provide a conference room that you can schedule and pay for by the hour. Often a business service center is located in the building to provide copying, faxing, parcel pick-up services, presentation graphics design, and other services for additional charges. This method of renting or leasing office space does have great advantages: a short-term commitment, business services already on site, and a businesslike environment. A standard office with a long-term lease of three to five years is less expensive per square foot because the owner is willing to offer a discount to secure a longer relationship. Every time an owner must advertise space for rent, a few months rent is lost, which cuts into profits. But either way, the reality is that most offices are at least two rooms and average $750 to $1,500 a month.
You’re right if you guessed that office rent is the largest single monthly expense that a designer can face. Therefore, you will want to come up with some creative ways to maximize your space both for designing and for storing catalogs, show files, research, and the business records you need for taxes. No matter where the space is, it needs to be quiet enough to work and at least offer the ability to control your environment to make private calls, keep your records secure, and store materials.
Oddly enough, where your office is geographically doesn’t always seem to matter. There are highly successful designers living in small towns away from urban centers who do very, very well. And there are designers living in high-priced, very small apartments in New York who barely making ends meet. Why choose one over the other? How do you decide what is best for your career?

Geographic Location

First, you should establish what needs your surroundings must satisfy. Do you have a family and need to find a home that is in a neighborhood with good schools? Does your spouse or partner also work, and does his or her job dictate the general area? Do you need to be physically in the same town as or live close to your primary client? In other words, if you are targeting a specific area of entertainment such as film, your location choices will be limited, because film companies tend to cluster around the studios—although they are no longer in Hollywood alone; studio facilities have sprung up in San Francisco, Phoenix, Chicago, Orlando, New York, New Jersey, Toronto, and many other places. Themed or location-based entertainment producers tend to be clustered around Los Angeles, New York, and Orlando. Are you going to teach, in which case the position you land will dictate your primary residence? Are you addicted to a sport such as sailing, horseback riding, or skiing that beckons you to a certain geographical area of the country?
Selecting your location can be a major factor in the direction of your career. But it is not an absolute determinant. Many people have chosen unconventional living over ease of access to clients. I drive seventy-five miles to and from my office and farther when I see clients at the studios. But I choose to live in a secluded area up the coast from Los Angeles with my wife, who hates Los Angeles. We also take three to four trips to my condo in the little town of Telluride, Colorado, each year. I work with a television technical director who lives in Northern California and commutes to Los Angeles several days each week. Other coworkers, including camera people, directors, and theatre people, live in Las Vegas and commute to Los Angeles. Certainly such arrangements are nothing new to New Yorkers, who often choose to live upstate or in Vermont or Connecticut.
My point is that we need to make these choices for ourselves, not to please some producer we hope to work with eventually. Living close to our work location is not as necessary as it was for the last generation. It is rare for all the members of a family to occupy the same house as their grandparents anymore. We live where we choose (a choice made by most working professionals), or we follow the work—and there’s nothing different about that for designers. But somehow I don’t think many of us really understand why we live where we do. It sort of happens by accident, and then one day we wake up and say, why am I living here? So make it a conscious choice.

Balance in Your Life

Something I have grown to feel very strongly about is that our lives outside our work must be discussed early on in the process of determining where we live. My family said I was a workaholic in my early years, so I have been seeking some balance between my professional career and my outside interests for the past twenty years. In 1980 I moved aboard a sailboat up the coast from Los Angeles toward Santa Barbara, California to get away from the 24/7 life of the business. This balance is not easily achieved, and I admit I didn’t always follow my plan. Then one day you can wake up and a year has gone by during which you didn’t do something you pledged to do. Psychologists and family counselors tell us that it is more important than ever that we create a social balance that isn’t involved with our careers. With the pressure of business and the insecurity we all feel from time to time, family, friends, and hobbies may be the things that keep us from falling apart.
I am heartened by the way my own son has limited his travel and work schedule to ensure time with his four young children, something I did not do for him and his sister. I now regret that I missed the joy, laughter, and tears of their young lives. But when I was starting out all I could see was the cloud that hid the peak I was clawing my way towards. It cost me my marriage, a lot of money in child support, and 50 percent of my business (that’s California law). So what I worked so hard to earn was taken away from me, as was my family. Is it worth it?
Someone is bound to say that that’s easy for me to say now that I’ve got an established career. And yes, the early years of s...

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