- Home
- Cinema glossary
- Minimum Guarantee
Minimum guarantee in film booking
A minimum guarantee is a floor on what a cinema pays the distributor for a booking. If the percentage terms would produce less, the cinema pays the guarantee anyway.
Also written: MG · MG · guarantee · minimum
How it works
Most film rental is a percentage of box office. A minimum guarantee puts a floor under that percentage: the cinema promises the distributor at least a fixed sum for the booking, and pays whichever is greater — the percentage, or the guarantee.
On a film that performs, the guarantee is irrelevant because the percentage clears it easily. On a film that does not, the guarantee turns into a fixed cost, and every empty seat is now costing the cinema money rather than just failing to earn it.
The term also turns up in a different sense further up the chain: a distributor pays a producer or sales agent a minimum guarantee for the rights to a film. For a cinema, the one that matters is the booking floor.
What a guarantee does to the rental rate
Effective share of takings paid to the distributor under 50% terms with a 500 guarantee. Below 1,000 in takings the guarantee is the real price.
Show the data as a table
| Takings | Effective rental |
|---|---|
| 400 | 125% |
| 600 | 83.3% |
| 800 | 62.5% |
| 1,000 | 50% |
| 1,200 | 50% |
| 1,400 | 50% |
| 1,600 | 50% |
| 1,800 | 50% |
| 2,000 | 50% |
| 2,200 | 50% |
A worked example
| Scenario | Outcome |
|---|---|
| Terms | 50% of box office, with a 500 minimum guarantee for the week |
| Film takes 2,000 | 50% is 1,000 — above the guarantee, so the cinema pays 1,000 |
| Film takes 600 | 50% is 300 — below the guarantee, so the cinema pays 500, which is 83% of what it took |
Figures are illustrative and in no particular currency. The point is the shape: a guarantee makes a weak week disproportionately expensive.
When to accept one, and how to push back
Guarantees are most common on flat-fee and specialised bookings, on event titles, and where a distributor is taking a risk on a small venue. They are reasonable when you are confident of the audience; they are dangerous on a title you are booking speculatively.
The levers are the size of the guarantee, the number of screenings it assumes, and whether it applies per week or per booking. A guarantee spread across a full week of shows is far safer than the same figure attached to a single screening.
Frequently asked questions
What is a minimum guarantee in film distribution?
For a cinema, it is the least it will pay the distributor for a booking. If the agreed percentage of box office comes to less than the guarantee, the cinema pays the guarantee.
Is a minimum guarantee negotiable?
Usually, especially with independent distributors. The amount, the period it covers and the number of screenings it assumes can all be negotiated.
What is the difference between a flat fee and a minimum guarantee?
A flat fee is a fixed price regardless of takings. A minimum guarantee is a floor under a percentage deal — the cinema pays the percentage when it is higher and the guarantee when it is not.
Keep reading
Film Rental
Film rental is the share of box office paid to the distributor — usually a percentage that starts high in the opening…
Distribution and bookingHouse Nut
The house nut is an agreed weekly figure for a cinema's operating costs, deducted from box office before the…
Distribution and bookingFilm Booking
Film booking is the process of securing titles from distributors and agreeing the terms they play on — the commercial…
Distribution and bookingFilm Distributor
A film distributor holds the right to release a film in a territory. For a cinema it is the counterparty for…
Distribution and bookingCinema Certificate
A certificate is the age classification a film carries in a given territory — and enforcing it at the door is the…
Distribution and bookingClearance
Clearance is a distributor's grant of exclusivity on a title within a geographic zone — one cinema plays it, and a…
Distribution and bookingDay-and-Date
A day-and-date release opens in cinemas and at home simultaneously, with no exclusive theatrical period at all.
Distribution and bookingFilm Programming
Film programming is the weekly decision about which films a cinema plays, on which screens, at which times — balancing…