REDUCE COSTS
Here is the sloppy breakdown again and below that we’ll show you a more granular detail at multiple payroll levels:
This change will likely see a 4-6% reduction in payroll processing fees and fringe costs. That might seem trivial, but across a $5M budget (60% of which is probably labor) that’s $120,000 to $180,000 per show that can be put to licensing software and on the screen.
In contrast, the generic payroll providers charge $2-$6 per month – more than 20 times less than the Entertainment Payroll Services get (based on a 1.75% of gross compensation fee). And the generic services never skim additional profit off fringe caps, nor do they charge excessive workers’ comp fees.
So that’s the sloppy breakdown. The chart below provides some detail across four different crew labor budget levels ($1MM, 2MM, 5MM & 8MM). It compares the cost to add the FAST Platform with ADP & Xero to complete the FAST Full-Stack.
The Differences are stark. You can see the difference on the bottom row in red:
To be clear, there will be wide variation in your saving because of workers’ comp and SaaS/storage operating costs that will reduce or increase that number, but these costs will be fixed and calculated at the start of prep. You will be in control of how to spend that money and how to calculate your costs as your budgeting.
A quick story about why I started looking for an alternative – it had nothing to do with cost. That was a side benefit.
In my case and in the case of my clients, we made the change for speed, efficiency, eliminating the cost of long-term paper storage and streamlining complexity. Honestly, I started looking at making the change when our Payroll Service, after 20 years of exclusivity and almost 200 projects, pushed me into their new policy change around leaving a big deposit (150 grand) for a $75K, 5-step, writer fee – paid over about 8 months. They told me I had to leave that deposit until the payments were complete. We had processed writers, for over 20 years, by swapping cash (through wire) for payroll. No money, no payroll – seems fair. The change did not seem like they were operating in the interest of their client (the producer).
So I started looking around at the crap service I was getting and the terrible software that everyone complained about. I also looked at the systems that corporate America has been using for decades. They are smart, efficient, mostly digital and available to any business that is willing to work on their platforms. You just have to learn how to make them work for your use case. The issue, as described, is that we have very specific demands in production finance and Full Force Financial needed to build a suite of software to make the generic platforms work for production. In making the change, I have seen a clear difference in efficiency and cost.
