Key Takeaways
- Standard Indian event production payment: 40% at signature, 40% at load-in, 20% within 7 days of event close
- A production company requiring 70%+ before load-in from a new client is signalling a cash flow constraint — understand why before accepting
- Retention (the final 20%) should be paid within 7 days of event close, not held as leverage — production companies have supplier settlement obligations that depend on prompt final payment
- Change orders (scope additions post-contract) should be invoiced and paid on the same schedule as the original contract — not deferred to the final payment
- Currency risk for overseas events: agree payment currency at contract stage — either invoice in INR at a defined exchange rate or invoice in foreign currency and accept FX risk
The 40/40/20 structure
The 40/40/20 payment structure is the Indian event production market standard for a reason: it balances the production company's need to commit supplier payments early with the client's need to retain final payment until the event is delivered. The first 40% (at contract signature) allows the production company to begin venue blocking, supplier booking, and crew commitment — all of which require advance payment from the production company to their own suppliers. The second 40% (at load-in) confirms the event is proceeding and releases the remaining advance obligation. The final 20% (7 days post-event) is retention — held against any defect claims or variation settlements. This structure works for both parties when executed as agreed.
What deviations from standard terms reveal
A production company requiring 60% upfront may be managing suppliers who require larger advances — not necessarily a financial health issue, but worth understanding. A production company requiring 70% or 80% upfront from a new client is more likely to have a working capital constraint that makes their ability to fund the event from their own reserves limited — which is a risk signal, not a dealbreaker, but worth a direct conversation. A production company that never asks for final payment to be accelerated — that routinely accepts 30, 60, or 90-day final payment terms — is subsidising the client's event with its own working capital. This is increasingly common and is not a sign of financial health.