Sales
Tables
Part 1 &
2
by Joel Mabus
originally
published in:
North American Folk Music and Dance Alliance
Newsletter
Vol. 10, No. 2 & 3, 1999
used by permission
About
the Author
Part 1
This issue, let's take a look at
the back of the room. At every self-respecting folk concert these
days, there is a table of recordings - CDs, mostly, and tapes perhaps -
and maybe some books, videos, t-shirts or even fly swatters for
sale. The reason is simple: the artist's sales are an increasingly
important part of the overall touring picture.
First, there is the basic fact of
life that the door receipts alone sometimes just can't support the cost
of the artist's appearance. A brisk night at the sales table
can often overshadow the artist's cut of the door, or the flat
fee. Secondly, for many folk performers the off-the-stage sale is
the only viable distribution that is available to him or her. The
best way for your work to land in your fans' collections is to sell it
to them yourself.
Even if you are with an
established label with decent (in folk music terms) distribution, there
is just no practical guarantee that the local “Best Buys” will be
stocked with plenty of your latest for the weekend after your local
concert. More often the scenario is that fans will plead to deaf
ears to order your CDs into the “folk” section of the local mega
store. And the local mom-and-pop store (if there is one) may
not have the budget to stock all the good music they would like.
You may sell via the internet, but not everyone is comfortable buying
the hi-tech way. The table at the back of the concert is still
your best bet to get the music in the hands of your fans.
Many of the most important
decisions concerning the sales table happen long before you arrive to
play: First and foremost, you should negotiate the strategy of sales
with the venue at the same time you negotiate your contract. There
are four big questions:
- Will they let you do sales
without a commission?
- Will they provide a table or
area?
- Will they staff it?
- Will the staff be fiscally
responsible and cover any shortfalls at the end of the night?
Many of the smaller, friendlier
folk clubs answer yes to all or most of these questions. Bless
them. Some see this as a courtesy to the struggling performer who
is playing for peanuts anyway. But, please, don't assume that this
is the case. And please don't take a personal offense if any or
all of the above questions are answered with a firm “no.”
Everyone has a different business sense - or a different circumstance -
and may have some fixed ideas about the way things should be
done. Besides, if you are a little past the “struggling”
stage, the venue might want a taste of your sales as a way to share the
rewards of a well-staged event. But remember - it is entirely
reasonable to negotiate any of these points.
The question of commissions is
probably the biggest one. There are, of course, two sides to this
question. The club may view the CD sales as a revenue source to be
shared - they are delivering an audience to you, after all. And
they may see 15% as a small take off the top to help recoup their
expenses. But you may argue that the audience came to see
YOU, not the club itself, and that selling the CDs is your own side
business with its own overhead, inventory and fixed costs. And a
little easy math can prove that the simple 15% of gross can quickly
approach 50% or more of the profits of your retail operation.
There are no easy answers as to
which side of the argument is “right.” Each concert situation
is different. My point is simply that these things are usually
negotiable, just as surely as are the terms of the performance
itself. Weigh all the issues when you are deciding the initial
agreement. If the venue insists on 30% of your sales, but will not
provide you with any support for your table, then you might not give
them much of a break on your fee. On the other hand, if you
suspect a good turnout and brisk sales of a new release, you might play
for a much lower performance fee if the venue will sell your product at
no cost to you.
But it is, of course, in your
best interest as the artist and retailer to try to avoid paying any fee
for the privilege of doing business. Here are a few points
you might consider in your negotiations:
- Don't rob Peter to pay Paul. If
the club pleads poverty - that they truly need part of your sales
profits to meet their budget - ask about a commission kicking in
only if they can't meet their “nut” on the ticket sales.
Do they expect your show to be a deficit in their books? If
that is indeed their expectation, you should be aware of that
fact. It should frame the entire discussion of fees and
percentages. It doesn't make a lot of sense for the
promoter to take fifteen percent from your left pocket in order to
fill your right pocket at the end of the night.
- Whose crowd is it anyway? If the
venue is arguing that they deserve a share of sales because they
provided the audience, ask them if they draw the same crowd for
every act that appears. Have you played in this town before?
Mention your mailing list (and the cost of it) if you send
one. Do they sell coffee and baked goods? Or
liquor? Do they offer a percentage of those sales to the
performer?
- Quid pro quo. Some venues (often
art fairs, First Nights, etc.) will demand a percentage of your
sales, but are not providing any support services - no salesperson,
no table, no security. If you must pay a fee, try to get something
for your money. Ask for help schlepping (or storing) the boxes
- ask for a table and some chairs - try to get something in exchange
for your loss of profit. Appeal to basic fairness.
- Know when to concede. It doesn't
pay to make an enemy of your partners in concert promotion. Good
faith negotiation can lead to some good-natured haggling. But
don't let the haggling turn into acrimony. Know your
break-even point. Always remember that if you really believe you are
being screwed on commissions, you have the option to leave the CDs
in the trunk of your car. Would you rather do that? That,
indeed, is the bottom line.
Just be sure to broach these
issues up front. Nobody likes an unpleasant surprise.
Minutes before a concert is not the best time to negotiate a deal on
sales. Even worse is negotiating the terms after the sales have
been made.
Next time we'll look at the sales
table itself and how to make the most of the opportunity to sell your
wares.
Part 2
Last time we looked at the issues
involving sales of recordings "off the stage," or more
accurately, off the table in the back of the hall. We considered
the negotiations between the artist and the presenter concerning
percentages and so on. This time, let's pay attention to the sales
at the gig itself.
One of the first things I do when
I arrive at a new gig is scout the location for the sales table.
Sometimes the venue has a regular spot for this - sometimes not.
If the issue is up in the air, I try to find a place that is in an
accessible part of the building, where passersby can see my wares, yet
will not become a bottle neck if more than two or three people are
looking over the CDs. If the presenter is providing staff to
handle sales it might be well to put the sales table next to the ticket
taker, or near the refreshments or somewhere else where patrons might
congregate during the break or after the show. If you need to work
the table alone personally, you might choose a location nearer the
stage, where you can keep an eye on the merchandise while you perform -
and keep an eye on your stage gear while you sell. The
perfect solution is to have your own trusted employee handle
sales. But that is prohibitively expensive for many of us.
Sometimes a band member, spouse, or loyal friend will do the job.
But for those of us who travel the circuit alone, the responsibility for
security rests squarely upon our shoulders.
If a staffer is there to sell for
you, it is of prime importance to meet with that person and establish a
few facts. First you must agree on beginning inventory.
Sometimes an inexperienced volunteer won't have a clue about this, so
it's up to you to insist - count in the merchandise. That goes
double - make that triple - if there is someone else's product sold at
the same table from a common till. You may or may not prefer to
have a title-by-title count, but at least you should put down in writing
how many CDs, how many tapes, etc., are there on the premises before the
sales begin. Then agree on the price per unit. If you are
providing start-up cash, write that figure down. The second half
of this equation is to do the count again at the end of the night.
Having that beginning inventory and startup cash written down is
imperative, because you might find yourself dealing with a different
volunteer when cashing out at the end of the night. Of course the
whole point of this exercise is to check the sales receipts against the
reduction in inventory. Let's hope they come out even.
I always try to have a
title-by-title count on a spreadsheet before I leave home, and at the
end of the tour I will enter my remainders. The spreadsheet
will tally my sales by title. I find that this chore is best done
by me for my own purposes of bookkeeping, so I don't ask it of the
sellers. All I really need from the sales person at the gig is to
make sure each CD that leaves the room is paid for. If there is a
discrepancy (usually a shortage) at the end of the night, you should be
prepared to either eat the loss or stand up for your rights and demand
the shortage be paid. This is where having the details negotiated
in advance is so crucial. Know whether the presenter is to be held
accountable or not before you entrust your wares. You must use
some common sense and perspective as well. If you've sold
100 CDs in ten minutes and find you are down $15, you might just want to
chalk up the loss to "shrinkage," and count yourself lucky to
have had brisk sales. On the other hand if you've "sold"
three CDs and ten have "walked off," then there might be some
explaining to do.
It is in your best interest to
have a tidy and attractive display of your recordings. Rummaging
through a cardboard box is not the best way to have your customer
explore your CDs. Make it easy for your customer to choose a
recording. If the print on your CDs is very small, consider a
larger printout display of the song titles for each CD. Or provide
a magnifying glass - or even a reading lamp. Good lighting is
important to making out fine print as well as making correct
change! I like to provide a stack of flyers nearby, offering mail
order sales as an option. There may be a potential customer short
on cash at the moment - or a fan who will want to order a second CD
after he or she has heard the first. Have a supply of
business cards with you. Keep some pens handy for autographs or check
writing. I try to keep my mailing list on or near the sales table
- people who buy your stuff are precisely the people you will want to
contact again. For this same reason, I allow personal checks to be
made out to me. This relieves the club from a banking headache and
gives me the addresses of my customers. (It says something about
the integrity of the average folk fan that I have never had a bounced
check on a CD sale.)
It has become the norm at folk
concerts (in the US) to charge $15 for CDs and $10 for tapes. It
is curious that the prime economic factor in this pricing structure is
not the law of supply and demand, nor the cost of goods sold, but simply
the fact that making change is a hassle. If you want to be nice
and charge, say, $13 for a CD - or if you are offering a super package
for $17 - you must be ready with a huge roll of one-dollar bills.
Even so you will get hateful glares from the poor souls who will be
making change. I don't see a good solution on the horizon for this
simple fact of life until either the currency introduces new
denominations, or inflation raises or lowers the value of a recording to
the next $5 plateau.
This brings us to the sticky
issue of SALES TAX. (US rules only in this paragraph! In Canada, taxes
are very different!) I know a lot of working folkies who sell
their wares with no thought of collecting sales tax. Some
may be libertarian tax rebels, some may be simple scofflaws, and some
may just be casual to the point of laziness. If this is you, be
aware that you skate on thin ice. The federal government doesn't
do it yet, but almost every state in the US levies sales tax. And
it is the seller's responsibility to collect it and turn it over to the
state. If you are selling CDs in the state in which you reside,
and you are not collecting sales tax, your own state government could
make life miserable for you if you are caught. (If you are outside
your own state when you make your sale, you may be just as culpable
within that other state, but might be less likely caught and punished
once you cross the border home.) Let me be clear. I am not a
lawyer. THIS IS NOT LEGAL ADVICE. But it is common
sense that the one state government you should square up with first is
your own. Don't rely on the folk club to collect your tax - this
is where they will likely wash their hands and close up shop if you put
the onus on them.
If you do decide to collect tax,
learn the rules for your particular state. Filing policies and
licenses vary. Rest assured there is a bureaucrat waiting to
assist you. Be aware of the option of selling with "tax
included." Say your state's sales tax is 6%. Selling
with tax included means you can be paid a total of $15 for a CD, as is
the norm, but for accounting purposes, you count the sale as $14.15 plus
85 cents (6%) for tax. If, instead, you wanted to sell the
"tax added" way (like they do downtown) you could charge your
$15 and then add 90 cents (6% of 15) to the fee to your customer.
Often the convenience of making change sways the choice. Whatever
you do, don't charge the $15, and then pay the full 90 cents out of your
own pocket to the state. Count it as a "tax included"
sale and save the nickel. At the end of the year, those nickels
add up! And remember that our "real" price of $14.15 is
the one that any commission should be figured from. If the venue
wants 15% of your sales, pay them 15% of sales price, but not the sales
tax too.
Of course, all this begs the
question of bookkeeping. If making music is an art that some of us
have made our business, the selling of CDs is a business pure and
simple. You need to keep track of inventory, vendors, customers,
sales etc. Not only to satisfy the taxman, but to help you plan
your next move, you need to keep track of those numbers! How are
tape sales compared to CDs this year? How is the second album
selling compared to the first? How many did you sell at that club
last time you played there? Only your books can answer these
questions. A number of software programs are out there to help
you. An over-the-counter computer program like the
ubiquitous Quicken makes juggling figures a snap. A basic
spreadsheet program can do a lot of chores. Old-fashioned
ledger books still work, too. Get some help if you need it to set
up your system, but don't let the task of tallying numbers slide.
Don't sell yourself short!
Lastly, communicate with your
audience. Find your own good-humored way of calling their
attention to the sales table and your newest release. But be
mindful that no one likes a hard sell. Don't come off like a
carnival vendor. Even if the evening's sales are economically
vital to you, you must remember that the listeners are there to be
entertained, not "sold." Keep your ears open to your
customers. Listen to their comments as they peruse your
offerings. How will your next project be better conceived,
better executed, and better packaged? Your customers will guide
you if you pay attention.
About The Author
 Joel
Mabus is a
singer-songwriter, but he doesn't sound like one. His roots are in
American old-time music, yet his music speaks to the times we live
in. "He knows his way around the English language and
American culture just as well as he knows his way around a
fretboard," wrote one critic. A maverick in the folk world,
Mabus defies any easy pigeon-hole. His palette ranges from
mountain banjo to jazz guitar -- from sensitive introspection to wicked
satire. Yet from coast to coast, he has brought audiences to their
feet -- newly won friends asking for more.
That's not an uncommon
response to Joel's music. As one fan told him -- "It's music from
the heart that hits you right between the eyes." The prestigious
Vancouver Folk Festival wrote of Joel -- "He has perfected the art
of being entertaining without pandering, he teaches without lecturing,
and does it all with great style."
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