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All Purchased Plans
Are Updated for 2017

Film Production Company SWOT Analysis

 

Strengths

 

Once a film is produced, and assuming it is popular, media production companies are able to generate substantial revenues from theatrical releases, DVD media, and digital downloads. After the theatrical release has ended, film production companies are able to generate highly predictable streams of revenue from licensing of their content to third parties. The barriers for entry for film production companies is extremely high given the large capital requirement needs to produce a feature length film. These types of businesses have startup costs ranging from as little as $250,000 to well over $10,000,000. The large startup costs related to these businesses is due to the fact that these companies need to have a large amount of capital available in order to produce films, short movies, and videos. From an economic standpoint, film production companies are usually able to remain profitable during times of recession given that that seeing a movie is considered a low cost form of entertainment.

 

Weaknesses

 

The operating costs for a film production company are extremely high. Almost everyone involved with the production of a film is a union employee. The marketing costs (not only for the film itself, but also for raising capital) are extremely high. This is usually the biggest expense for these businesses. Competitive issues are always a concern when a new film is released given that people only go and see one movie at a time.

 

Opportunities

 

For film production businesses, the continual development of new films and related productions is the way that these companies expand their operations. Most film companies also maintain ongoing relationships with investors that they can call upon to acquire rounds of capital in order to produce new films. It is imperative that these businesses have continued access to new capital even after they are initially funded.

 

Threats

 

The biggest threat that a film production company faces are ongoing competitive issues from other companies releasing movies at the same time. This is something that needs to be well planned in order to make sure that similar films are not in genre-competition with each other. Digital piracy of films is also and continued threat to film production companies and movie producers. Many film production studios use extensive technologies to ensure that these issues are kept to a minimum. Digital rights management technology has improved greatly over the past ten years.


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