A long standing issue, whether or not music venues should receive a percentage of merchandise revenue on the day of show, has recently reached a boiling point.
It appears the practice of effectively charging bands for the privilege of using their space to sell merch has become more prevelant since the pandemic.
The way it typically works is the venue will assign a staff member to “count in” and “count out” merchandise inventory before and after a show. At the end of the night, the band is forced to remit a portion of their merchandise proceeds to the venue based on what they sold. The split varies, but reports of 80/20 and 70/30 have been made public.
From the venue’s perspective, the theory is the band wouldn’t’ve had the opportunity or audience to sell to if the venue hadn’t hosted them. But it’s a tug of war. Would the venue have had an audience to sell drinks to if the band hadn’t played?
And ethically, in an industry where artists historically suffer, how can going after one of their last reliable income streams be justified?
Where Fire Sign stands on the issue is: Never pay the venue. That’s just not how it’s supposed to work. If the venue wants to open a retail store and sell band merch like Hot Topic, so be it. But they should pay the licensing fees to the bands who produced that merch and popularized their logos.
In a recent interview with YouTube series THAT Rocks! guitarist John Petrucci of Dream Theater spoke on the issue:
“I think that if you’re in the position, you should try to negotiate that as much as you can. I mean, 30 percent, that’s way too high… But it’s all reasons to be on top of your sh*t and your business, and have people representing you that know what they’re doing, because a young band might not know that they can negotiate that.”
The issue has reached the forefront of the music industry recently, with many artists speaking out in frustration. In Flames’ Anders Fridén encouraged his peers to fight:
“It can’t be just a few bands that say something. Everyone has to react. It can’t be just a few bands or someone in a band saying something and complaining because nothing is going to happen.”
While Stray From The Path’s Craig Reynolds lamented via Twitter:
Didn’t wanna say anything because we literally NEED you guys to buy merch but this o2 venue stuff is insane: They FORCE you to use their merch seller (who is not invested in selling your merch, or doing a good job) and then they take 25% of the GROSS amount that person makes.
Meanwhile, on the extreme end of the battle, Russian Circles has opted to stop selling merch at venues that enforce egregious splits.
Instead, the band took to Instagram to direct fans to their online store:
“AS YOU ARE PROBABLY AWARE, MERCH SALES ARE VITAL TO KEEPING ARTISTS FINANCIALLY AFLOAT WHILE ON TOUR. VENUES OFTEN TAKE A PERCENTAGE OF MERCH REVENUE FROM ARTISTS, AND THEIR RATES HAVE GOTTEN HIGHER IN RECENT YEARS.
AT TONIGHT’S SHOW IN PARIS, THE VENUE HAS ENLISTED AN OUTSIDE COMPANY TO SELL ARTISTS’ MERCH. THIS COMPANY TAKES A 25% COMMISSION AND WITHHOLDS A 20% VAT TAX.
OUR OPTIONS APPEAR TO BE EITHER RAISING OUR PRICES OR LOSING MONEY, SO WE’VE OPTED TO NOT SELL MERCH TONIGHT. WE APOLOGIZE TO OUR FRIENDS AND FANS IN PARIS WHO WERE HOPING TO GRAB A SHIRT OR LP AT THE SHOW, BUT WE DON’T WANT TO PARTAKE IN THIS ARRANGEMENT WITH THIS COMPANY.
IF YOU WANT OUR MERCH, IT IS ALWAYS AVAILABLE AT EVIL GREED.
THANK YOU.”