Inspired by the testimony of the band Lawrence and the struggles it faced as an independent act during Tuesday’s Senate Judiciary hearing on Ticketmaster, Ineffable Music Group CEO“After about an hour watching the hearing, I grabbed the phone and started calling the venues we owned and operated,” says Cussins.
The decision will cost the company “several hundred thousand” per year in revenue, Cussins estimates. but “hopes to make it up via a healthier concert ecosystem,” he adds, noting that the merch fee that venues charge artists is often the one thing touring bands say they most want to see changed about the club and theater circuit.
When bands go on tour, their revenue streams are almost exclusively a share of ticket sale revenue and band merchandise sales. In addition, expenses for travel, production and health insurance have increased significantly, as have the costs associated with printing and shipping t-shirts and other merchandise.
On a good night, an independent touring band with a loyal fan base can sell $5,000 to $10,000 in merch at a 500-cap show. Eliminating the venue fee can save some groups $1,000 to $2,000 per night, Cussins says. That can make a big difference in a business where the margins in merchandise are vital to the economic feasibility of touring. The more diverse a band’s income streams are, Cussins says, the less reliant they’ll be on tour guarantees.
“We are on the ground and hearing from artists every day,” says Cussins. “We are seeing how much the costs of everything have gone up — from buses to hotels to flights. So even though the club business is a marginal business, any action we can take to help to insure a healthy, vibrant concert ecosystem is important. This industry only works if artists of all levels are able to afford to tour.