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DIY Touring, Pt. 3: Budgeting for the Road

June 1st, 2017

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This article originally appeared in the June/July 2017 issue of Canadian Musician.

By Liam Duncan

These days, it’s almost assumed that bands hit the road and lose their shirts. The image of the starving artist is a tired cliché, but one that many people buy into.

In fact, many artists also end up believing that they can’t make money touring. This perceived risk often prevents them from ever trying to hit the road.

Before I get into why I think this is false and you should be touring, let me first say that some artists are wise to wait. For example, profitably touring a seven-piece band is very difficult. Only you can know if you’re ready to get on the road and take the financial risks involved.

“I’m not a big fan of touring for the sake of touring,” explains Tim Jones of Pipe & Hat, an artist management firm and record label from Winnipeg. “To me, you end up losing money if you’re chomping at the bit to get out there and end up going on a tour that doesn’t make sense.”

That said, I’ve been profitably touring with my original band, The Middle Coast, since I was 17 years old. I also interviewed Murray Wood of Edmonton folk-tinged indie pop trio Scenic Route To Alaska. After releasing their album Long Walk Home last fall, they toured for literally three months straight. Nobody would do this if it was losing them wads of money.

“The way we did it right off the bat was to do what was easiest first,” shares Wood. “We started with smaller tours in Western Canada, built up those markets, and went from there.”

The Middle Coast

The Middle Coast

Similarly, my band’s first tour was 10 days long and we came out with $400. Our second tour was 18 days long, and we came out with around $800. We weren’t exactly rolling in it, but all of our food was paid for, all expenses covered, and we didn’t really lose any money except in lost wages from our part-time jobs. And we were young, so that didn’t matter.

“On our first tour, we didn’t bring very much gear and I think we did the whole thing in Shea [Connor, drummer]’s old ’91 Corolla,” Wood continues. “We were super frugal and just did what made sense.”

I was very taken aback to learn that many artists and almost all non-artists thought that we were losing money touring. What I took for granted was a member of the band who had a great head for business. That value was instilled in the rest of us and we went on our merry way.

It’s not very rock n’ roll, but yeah, we made budgets. We figured out how much we were going to make at gigs vs. almost exactly how much gas we would need, food we would eat, hotels we would buy, etc. That informed our spending decisions as well as the gigs we would take.

As our tours progressed, we began making more money. We received grant funding, drew more people, got better at negotiating, got better at cutting expenses, and got better at saving money. Touring gets easier the more you do it.

“Most of our bands are now at the point where they have solid agents that get them on good tours,” says Jones. “Our tours are usually making money before they leave, just with fees. It’s grants that help subsidize expenses and allow artists to actually put some money in their pockets.”

Lately, we’ve been getting good at keeping track of merch. Being smart about organizing and tracking merch will ultimately allow you to sell more of it, and selling merch can send a budget into the black surprisingly fast.

HOW TO MAKE A BUDGET FOR AN INDIE TOUR

There is no excuse to forgo making a budget. It takes as little as 20 minutes if it’s a basic budget and no more than two hours if you’re going into detail.

You will save money if you make a budget. It’s as simple as that. Knowing where you stand financially will inform decisions about where to spend your money and will keep everything on the up and up with your band members.

Budgets are essential if you are applying for grants. Grants and budgets also have the unintended effect of getting you properly organized for the entire tour.

“The grants force you to be on top of things,” notes Wood. “We have a folder system where we bring it on the road with us and we sort all of our receipts as we go. How closely we stick to the budget… well, that depends.”

So how do you make a budget? It’s really not difficult, and your budget will adapt the more you tour and encounter different scenarios and expenses that will be unique to your band.

Step 1: Calculate Your Income

I find it easiest to do this first. It forces me to organize and gather details, and you’ll be better prepared for the more complicated task of calculating expenses. When I analyze my income, I break it up into three categories. Here’s what that looks like:

Mar 29 – Cool Venue, Calgary, AB

Murray Wood (left) & Scenic Route to Alaska

Murray Wood (left) & Scenic Route to Alaska

Guarantee: This is the money you are guaranteed by the venue and/or the promoter. Sometimes this is nothing; other places offer small guarantees.

Door Income/Ticket Sales: Of course, door income and ticket sales will have to be estimated. Always estimate conservatively. One bad night can ruin a budget, so always plan for fewer people showing up than you would expect.

Merch: An estimate of how much merch you will sell. Again, I always go conservative on this. On bar shows, I often just estimate $50. If I’m playing a house concert or a larger show, I’ll estimate more like $100-150. This will vary from band to band depending on the venue and the type of gig.

The reason you should be organizing your income like this is the distinction between guaranteed income and estimated income. This way you can budget for a few different scenarios.

I make one calculation with just the guaranteed income. If nobody comes to any of the shows and I don’t sell any merch, I’ll know exactly how much money I’ll make.

Another estimate should be made with the guarantees and a very modest estimate for merch and door income. It’s pretty unlikely that absolutely nobody will come to your shows. This estimate is useful to plan for a realistic worst-case scenario.

Finally, make a final estimate with your most reasonable, realistic estimates for door income and merch. This will be your working income projection.

Step 2: Calculate Your Expenses

Over the years I’ve refined my list of expenses to include nearly every expense we encounter. I will list the expenses I calculate in order of how common they are and how important they are. I’ll also include how to calculate certain expenses.

Vehicle/Trailer Rental: Renting a trailer/vehicle is one of the most expensive items on the list. We pay a small sum to a member of the band who owns the vehicle, instead of renting something else, though many bands are forced to rent.

Gas and/or Mileage: It’s easy to figure out how much gas you’ll need on a tour. Use Mapquest or Google Maps and figure out your total mileage. Multiply it by 1.15 to account for city driving/getting lost and divide that by how far a tank of gas gets you in your vehicle. You’re left with the number of times you’ll have to fill up. Multiply that by the cost of a tank of gas and you have a pretty good estimate of the amount gas you’ll be buying.

Food OR Per Diems: If you’re in a band with no hired members, purchase all the food on a band card or with merch money and keep the receipts. This is better than paying out per diems, as per diems will be spent less efficiently. Note per diems can be useful for grants. If you’re claiming per diems, you don’t have to return individual food receipts. It saves hassle.

Whether you’re paying per diems or not, count on $35/day per member of the band. Sometimes it will be less, sometimes it will be more; it will depend on the day. Get specific and figure out how many of the venues you’re playing are providing meals. This will allow you to calculate a pretty specific idea of how much money you’ll be spending every day. Food is usually one of the top spending categories.

Artist/Crew Fees: Bringing a side musician, tech, or tour manager with you will cost money. Enter that cost here.

Accommodations: Figure out where you’ll need hotels. This is the perfect time to start looking for deals, or preferably, finding a place to crash. Hosts prefer to have a heads up. If you know you’re going to need a room, ask in advance. You’ll have more luck this way. I usually include a few little ‘Thank You’ gifts for hosts in this budget. They are always less than a hotel and people appreciate them.

Airfare: Book your flights six weeks out to get the best deal. Use Hopper or a similar app to keep your eye on flights and get the best deal.

Ferries/Tolls: When you are figuring out how far you’re going, take note of ferries and toll roads. Figure out how much they cost and budget for them.

Tour Promotion: We’re talking posters, Facebook ads, etc.

Misc. Travel: This is for taxis, parking, etc.

Equipment/Instrument Rental; Agent & Management Fees; Room Fees: Many independent bands won’t have these last few, but if you do, they can take a significant toll on your revenue.

This seems like a lot, but it really doesn’t take very long. Once you’ve done it a few times, you’ll realize that you can often calculate a few things at once.

While you’re figuring out how much you’re getting paid for a show, you can also figure out where you’ll be staying, if you’re getting fed, and how far it is from the last show. Doing this will keep you organized and keep your budget afloat.

WHERE CAN YOU SAVE MONEY?

In that list of expenses, you can find ways to cut costs. Let’s dig into a few of the biggest expense categories and give you some ideas on cost-saving measures.

Accommodations: Nothing digs into a budget faster than spending big money on a hotel room every night. Hotel rooms are not cheap. Even using Hotwire or Priceline, you’ll still end up paying $90+ for a room each night.

I generally budget for $110 per night if I’m buying hotels, because it’s possible to end up in a city without many hotels or with high prices.

Always ask the venue to put you up. They’ll usually say no, but you never know. Sometimes they have a “band house” or a friend who likes to host bands. Failing that, ask your friends, family, and distant relations. If you do this in advance, you’ll have an easy time finding someone. Typically, if they say yes it’s because they actually want to. You can make some great friends this way.

Motels are also significantly cheaper than hotels. They are usually found on the edge of cities, and are often under $100, taxes included. Many of the rooms are just as nice as hotels! Read the reviews though – you don’t want to end up with bedbugs.

Tim Jones of Pipe & Hat

Tim Jones of Pipe & Hat

AirBnB and similar sites are also options. There are usually a few in every city that will cost $50, sleep you on couches and air mattresses, and be quite safe.

Vehicle/Trailer Rentals: Renting a vehicle for long trips is insanely expensive. A three-week trip in a minivan on Expedia was costing at least $1,400. I’ve had friends pay upwards of $2,500 for a similar length.

Listen, for the price of a few tours, you can buy yourself a nice pre-2008 Dodge Grand Caravan with under 150,000 kms on it. I’m not a car guy, but I’ve had a few of these vehicles and they are cheap, super reliable, and fit a lot of gear.

“I think a lot of bands make the mistake of bringing too much gear or investing in a giant van right away,” Wood says. “I think it was really beneficial for us to do a couple of barebones but profitable tours first, before adding anything like that.”

Renting a trailer is not very expensive, but it is a pain. Hauling a trailer through the mountains is terrible on your gas. You can’t park it anywhere. They’re easily stolen/broken into. Tour in the smallest thing you possibly can and try to avoid renting a trailer.

Food: We all know food is expensive. That’s why most of us don’t eat out every night! When you go on tour, you’ll end up eating out almost every meal. With a four- or five-piece band, this adds up quickly.

First off, always ask for meals from the venue. If they serve food, it’s really the least they can do.

Try going to the grocery store every once in a while. A little fruit will not ruin your punk image. The grocery store often has cheap baking, bulk drinks, and produce. Bring a little cooler with you to stock up on these snacks.

If anyone is kind enough to give you a rider, raid it. Take the extra food – they bought it for you!

WHERE TO SPEND YOUR MONEY

Everyone’s threshold for doing uncomfortable things to save money is different. I’ve slept in some pretty uncomfortable situations – dorm rooms, really dirty houses, etc. We’ve agreed to avoid these situations whenever possible.

“This is actually your life and you have to find ways to enjoy it.” Wood advises. “If you’re touring half of the year, you need to find ways to feel like you’re living a valuable life. We all learned how to do Rubik’s Cubes on our last tour.”

If we sense that our sleep is going to be terrible, we’ll often take the option and buy a cheap hotel. It’s usually worth it.

“Yeah, we’ve been in a situation where you sleep on the floor in Victoria and get three hours of sleep, and then go to play a 300-person show in Vancouver the next day,” shares Wood. “That just makes the whole experience worse.”

We try to be frugal with food; however, eating cheaply often means eating poorly, especially on the road. Lately, we’ve been spending a little more (around $15/person) on a big, delicious lunch/brunch everyday, and then avoid eating until we get to the venue. Often, this means we’re only buying one meal per day, and it means our one meal gets to be more delicious and healthy.

Finally, never skimp on van maintenance. I own the van we use, and the peace of mind is worth every penny. Your van will also last longer and you’ll end up saving money over time.

THE DIFFERENCE A SHIRT CAN MAKE

Everybody knows that selling merch is important. Where many artists fail is keeping track of that merch and understanding how to properly manage their merch sales.

At music conferences, you’ll often hear people tell you to “run your band like a small business.” Another tired cliché, but truly, when you are selling merch, you’re basically setting up a small retail business.

Keeping careful track of your merch has many benefits. You need to keep inventory for taxes, track album sales for grant reporting, and track merch sales so that you stay on top of it.

“If the band isn’t tracking merch, they’re not making money,” Jones says bluntly. “If you’re making money, you want to know how much and how to split it up. If you’re keeping track of merch on a long tour, then you can plan for running out of merch. Maybe set up a drop shipment to wherever they’re going to be.”

Ordering merch is always tough. You have to put out a bunch of money and you never really know if anyone will buy it. Keeping track of merch will allow you to refine your ordering strategy.

“It’s sort of trial and error, figuring out what your audience likes and doesn’t like,” Jones offers. “If you’re keeping track, you can do short supply runs and find out what you need to buy… right down to specific sizes.”

Like budgeting, keeping track of merch doesn’t take much – just a little bit of extra thought. Keep a little binder and fill out a separate merch report for every gig. Keep track of everything – models, colours, and sizes. You’ll be glad you did and can learn to be more efficient and effective with your ordering based on that.

Keeping on Top of Finances Will Make This More Fun

Honestly, doing all of this can be fun. Usually, it falls on one member to keep most of it organized – someone with a head for numbers.

Running your band like this makes it into more of a job, which can be rewarding and even enjoyable (believe it or not). It’s exciting to realize that you’re steadily making more money on a tour and exciting to finally pay yourself something.

It’s also just more fun to tour when things are well organized and thought out. If you’re not worrying about the small stuff, you get to focus on the big stuff – playing a great show and making good connections and new friends.

END

Liam Duncan is musician and writer based in Winnipeg, MB. He likes to make music with his band The Middle Coast. Check them out on Facebook.

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