With the long-time decline of traditional album sales and song-streaming royalties that pay little except for the very best-performing tracks, bands are struggling to make even a modest living or generate supplemental income from their music. More bands than ever (folk, blues, and otherwise) are finding the only viable to make money is to go on tour. Even then, a cut of the door sales may barely be enough to break even, if that. Often, the profit-making difference lies in the band’s merch table. And yet. It takes time. And its own modest investment. And even more of your energy than you’re already putting out on stage. Show after show after show, it can—it will—eat at you. There will be nights where you don’t think you can get behind that table or deal with the line of fans lining up to talk to you and maybe buy some merch if you’re lucky. But you also know if you don’t get out there, your band isn’t going to earn much, if any, money from that night’s show. How do you strike that balance? When is it time to hand the merch reins over to somebody else entirely.
All this being said, it’s worth the time to learn the basics of managing your band’s merch, both when you’re first starting out and once you start building a sizable following.
DIY and Designating a Merch Person
When most bands first start out, they don’t have much of a following or a road crew. If they’re lucky, they have a good friend or romantic partner who’s willing to help out and run the merch stand during most shows. If they’re not lucky, the band will make an announcement about merchandise being available after the show. Depending on the venue and crowd, it might also be feasible to set up a merch table near the stage with information about the products and prices and a lockbox to deposit cash. Needless to say, none of this is a long-term merchandising solution for successful bands.
Hiring a Tour Merch Company
Successful bands typically find that their merch lines grow longer and longer and their sales get bigger and bigger so that it becomes too much for a single roadie-type person. Likewise, even if a single merch person isn’t overwhelmed by the job itself, a lack of efficiency, specialized skillsets, and overall management may represent a missed opportunity for your band. The average band member or roadie doesn’t have connections to or experience with negotiating merch production costs.
A tour merchandising company will collaborate with the band to design items that are likely to have strong sales while also reinforcing the band’s public image. They will then produce the items and be responsible for coordinating the delivery of band merch to each venue the night of the show. Often, though not always, the venue itself will take charge of running the band’s merch table, but this should be done in collaboration with the tour merchandising company which may have expertise and guidance about how to best present and sell the band’s merch. Manhead, for example, is doing something different and really cool for tour merchandising with its Sidestep technology. This program contacts ticketed fans before the show. These fans can browse available merchandise and pre-order items for pickup at the show. These fans get first dibs, but better yet, they get to skip the line and quickly pick up their items. We’ve also heard that some tour merchandising companies will use a planogram software company to help design and track optimal merchandising displays for their bands.
Know the Business Side
By the time a band hires a tour merch company, they typically have a contract with a record label and often a band manager. If the band or band manager doesn’t have experience with tour merchandising contracts, it’s important to learn about the process and/or find someone who does. They tend to be way different than record label contracts. In essence, the tour merchandiser will license the right to use the band’s name and likeness on the merch they produce. They will then usually pay the band a royalty on the sales. A floating industry standard usually has the band take about 30% of the gross sales, or a smaller percentage of the net profit. In addition to the cost of producing the merchandise, the company will also pay the “hall fees” charged by the venue, sometimes even when these hall fees are negotiated between the band and the venue.
The contract should also clearly spell out the services and responsibilities of the merchandiser as well as the obligations assumed by the band. It will state the term, or duration, of the contract—whether the agreement is for a single tour or a multi-year contract. The commitments made by the band often include a certain number of concert-goers per show, a certain number of total shows, and/or total merchandising sales. The contract often includes an advance payment to the band, but if the band fails to meet its contractual obligations, this advanced must be paid back to the merchandising company.
Of course, by the time a band attracts a major tour merchandising company, they usually have a strong and fairly reliable following. At the same time, the popular and biggest-name bands don’t always stay that way. Thus, it’s often best to stay on the conservative side so as to not to put too much pressure on your band and its following. This can be true even when it looks like taking on more obligation might pay off with a bigger check on your next tour. It also depends on what the band members’ principal goals are. Are you trying to make as much money as you can, or are you trying to take the tour merch job off you and your roadie’s plate so that you can go back to focusing exclusively on putting on a great show night after night.
You can read more about these tour merchandising contracts from The Balance Careers.