How a Movie Declared Hit or Flop at Box Office | Indian Film Business Analysis

Indian Film Business Analysis: Nowadays Indian films became popular day by day, they have millions of fans worldwide. A lot of movie lovers curious to know about a film box office collection and they are researching it on the internet. Sometimes you have seen a 200 Cr budget film earn 250 Cr worldwide but the film declared a flop at the box office.

Here a lot of key factors working behind the film business. In this article, I am sharing with you how a movie declared hit or flop at the box office and a complete Indian films business analysis.

Indian Film Business Analysis

Indian Film Business Analysis

Thousands of Indian movie fans curious to know about the film business process. Sometimes you see a film collected 50 Cr and became a disaster at the box office, and another side a film collected 10 Cr and declared Hit at the box office.

So we are sharing with you how film analysts gave the verdict to films like Hit, Flop, Blockbuster, All Time Blockbuster, Disaster, and Average. What are the key factors of Indian films and how films are making money?

Let’s starts with how is the box office system running?

You have to know various roles behind filmmaking, like what is producers, distributors, sub-distributers and what is the gross, nett, and share collection of films.

How a Movie Declared Hit or Flop at The Box Office

What is a Producer:

A producer is a person who gave money for the entire production cost of films. Sometimes many films produced by joint ventures like various production companies. The producer hires the director, actors, writers, and other staff.

What are Distributors:

If a film ready for theatrical release producer sells the theatrical rights to the distributors. Distributors are the people who have halls in different areas in their hands, It could be a contract with the owner of many halls.

Pre-Business System of Films:

Earlier to the release of any movie, satellite rights (broadcasting rights), music rights, dubbing rights (any language), TV rights, remake rights, etc. were added to any movie. In other words, apart from being released, all the income from these factors goes into the producer’s pocket. This called pre-business for the film. 

What is Theatrical Rights:

we have discussed Distributors before, producers sell the theatrical right of the film, the price is called Theatrical Rights. Its mean Producer sells all kind of rights prior to the release of any film.

Distributors buy the right to run the movie in their halls at a price or contract to 50-50 shares with the Producer. Again, many deals happen with the producer’s money back or money giving type. This means that if there is a loss, the producer will back the money to the distributors. And if there is more profit, the distributors will give some of the profit to the producer. But this happens in very rare cases.

It looks like prior to the release of any film, the box office does not affect the producers in most cases. The box office verdict matter for the person who bought the hall permission from the producer (the distributors) in the halls who are running the business.

What is Gross, Share, and Nett Gross Collection

Gross Collection: Total income from the box office.

Distribution Share: Gross Figure-Tax-Halls Owner Share-Other Spending Figure

Nett Collection: Gross Figure-Tax

Footfalls: The total amount of ticket sales of the film is called Footfalls.

Bollywood Box Office Verdict System

Before we are starting with the Bollywood Box Office Verdict System we have to know about some other factors. So let us start

Break-Even Point of Film: “Break Even” is the amount of money that a movie has to earn in that particular area to recover the theatrical rights price. It means the amount of target that will make a profit after crossing the figure amount that is called Break-Even. 

Let’s come now the Bollywood Hit or Flop Verdict System-

Return Of Investment Method System

In this method the budget of the film directly involved with the box office verdict.

(Earning mean the share collection of the Distributors)

Average: If the film recovers the budget from the theatres then the verdict will be Average.

Semi-Hit: This verdict would have come if the film had come close to doubling his income as compared to the budget.

Hit: If the film recovers 200% of the budget then the verdict will be Hit.

Super Hit: If a film collected 300% of the budget then the verdict had come to Super-Hit.

Blockbuster: To get Blockbuster Tag at the box office a film needs to earn more than 400% of the budget.

This tradition is very old, now there are box office verdicts that will give in a new tradition that is called Mixed Analysis Method.

Mixed Analysis Method System

This tradition is linked by Domestic Market Share Collection from compared with Theatrical Rights of the film. In this method, box office verdict gave by to calculate with Break-Even Point.

Hit: If a film recovers 100%-119% of Break-Even Point the verdict will be Hit.

Super Hit: 120%-129% recovery of Break-Even Point.

Blockbuster: 130%-150% recovery of Break-Even Point.

All-Time Blockbuster: To get All Time Blockbuster tag at the box office a film needs to recover 200% of the Break-Even Point.

In this new tradition If anyone brings a 4 crore shares collection of any Bollywood movie with a budget of 2 crores, then the films do not get the Blockbuster tag. Because in that case, it was seen that all small budget films became blockbusters at the box office. There is a huge difference between a 2 Cr budget & 4 Cr share collection film and a 100 Cr budget & 200 Cr share collection film.

That’s why the verdict gave compared the budget, footfalls range, and some other important key factors. There is the various process working in this tradition that’s why it is called Mixed Analysis Method.

We have seen many reports of the previous period of Bollywood Films’ box office verdict on the internet. Mainly the verdict had given by the Return of Investment (ROI) method. The blockbuster of the previous period films has made more income than many all-time blockbusters of today films.

South Indian Movies Box Office Verdict System

South Indian films Hit or Flop Verdict system

In the South Indian industry, A film is Hit when if a Film “Break Even” is passed through Distributors Share Collection. 

   Profit Percentage  Verdict 
1%-20%Hit
21%-30%Super-Hit
Above 30%Blockbuster
Loss PercentageVerdict
Above 30%Disaster
25%-30%Flop
20%-24%Below Average
Less Than 20%Average
5%Semi Hit
Less Than 10%Above Average

Here profit or loss means the distribution share collection for the film.

Hope this article sort helps you to know the Indian films business system. We discussed Bollywood and South Industry verdict systems and Indian Film Business Analysis with proper information. If you have any questions regarding this kindly contact us through  Contact Us page.

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