Peter Hook joins debate on venues that take a cut of merchandise sales

Peter Hook, founding member of Joy Division and New Order and these days active with Peter Hook & The Light, has joined the debate on venues that take a cut of merchandise sales. The debate was started by Tim Burgess, vocalist of The Charlatans, on twitter:

“Big respect to those venues that don’t take a percentage of a band’s merch sales. This isn’t about The Charlatans, it’s about those bands who need merch income to survive. Some places take 25% A quarter of the full selling price. Vinyl doesn’t even have that mark up to begin with […] To be perfectly clear about this, often it’s a completely separate ‘concession’ company that the venue deals with as part of a contract. A kid who has never heard of the band sells our stuff, while our merch person steps aside for the night – the whole system needs addressing […] Someone drove the three hours from Bournemouth to Cambridge to sell our merch for us – for 25% of the take. While we had someone with us, who worked on the designs and who knows the band and our fans. We need to make changes. Guessing a lot of people don’t know this stuff.”– Tim Burgess

He went on to say:

“Wondering if @O2 are aware of this. Their name is attached to many of the venues that do this. It’d be great to know their thoughts on it […] Artists, we can use our collective voice to make changes here. We make noise for a living, we can work toward securing a (slightly) better future for those musicians who follow in our footsteps […] Lots of the venue managers and staff are unhappy about this too. They aren’t even aware what happens to the money when it’s paid to the concession company. Many of them spoke up about how ridiculous the whole thing is. […] I can’t stress enough that this isn’t me complaining on behalf of The Charlatans – we do OK, we’re fine. This is the bands who need every penny they bring in to help them thrive and survive”– Tim Burgess

He concluded his views with a suggestion:

“Maybe bands need to ask for a percentage of the bar take”

– Tim Burgess

Next to Echo & The Bunnymen who stated that they were “totally behind” Tim Burgess on this matter, also Peter Hook has shared his views on this practice now:

“I have been arguing with venues (mainly larger ones) about this for years. Charging the band 25% commission on the gross of anything sold makes having merchandise for most bands a total vanity project. Creating the artwork alone can cost £500 to £700, then the printing and transport of most two colour t-shirts normally costs between £6 – £8 plus VAT. Another thing that these venues refuse to do is to take the VAT off the gross before they take a commission, which is actually illegal because the VAT belongs to the government. […] If we were to sell our shirts for £20 minus VAT, so £16, the venue is taking £5 per shirt after the average costs of say £6 and the band are making £5 at most. Out of that £5 we then have to pay the seller and pay for transport, and some bands may also have to pay their management a percentage of that profit too. I think it goes without saying that if the commission came off the net profit rather than the gross it would be much fairer. Whilst obviously the band get a fee for playing, the venue makes a profit on the bar, the cloakroom and sometimes even the car park! Their faces when you ask for a cut of any of that is priceless…”– Peter Hook

However, Peter Hook also reminds of the personal responsibility of performing artists:

“This is a big problem within our industry but while it inexplicably remains common practise in my view it should be sorted out between the promoter and the venue before the band even get there. I have lost count of how many great gigs have been ruined by the same post-show argument over a few hundred quit when the show has actually turned over hundreds of thousands of pounds, which is of course far more than we have been getting paid. Well done Tim for speaking up about this! You have my full support & let’s hope we can change things for the good of all artists.”

– Peter Hook

While the venue “The Old Market” near Brighton decided to remove artist merch fees, “Ulster Hall” in Northern Ireland’s capital Belfast insists that charging the fee is in line “with industry standards”.

It remains to be seen how the debate continues and if similar dialogues on the subject will also be started outside the UK.