Reuters presents yet another article on the myriad ways in which rising gas prices are burning bands, this time with a focus on developing acts. As we all suspected (or maybe even knew...depending on who's reading this) the big guys aren't really feeling the pinch the way some of the rest of us are.
"We used to budget tours at about 30 cents a mile for gas, and now we're up to about 60 cents a mile," says music business manager Jamie Cheek, certified public accountant at Flood, Bumstead, McCready, McCarthy. "If I have an act that's about to go on a 40-day tour and they've got five trucks and five buses, and a 40-day tour could be over 20,000 miles, that's almost an additional cost of $6,000 a vehicle. So if I have 10 vehicles, that's an additional $60,000."
That money comes directly out of the artist's bottom line, Cheek says. "But the flip side of that is, if it's five trucks and five buses, that's a big tour, and chances are if I look at the overall budget, fuel is maybe 2 percent to 3 percent of my overall costs," he points out. "If your overall expenses are $5 million for the tour, $60,000 -- though I don't want it to be there -- is not going to stop me from touring."
While the article predicts that arena artists may raise ticket prices to cover some of these exorbitant expenses, on the club end things are not budging. Most promoters and clubs I've spoken to are rarely willing to give higher guarantees because of the rising cost of gas, and fans (who often have to drive to the shows themselves) have not accepted that EVERYTHING is going to cost more.
Full article here