005 Merch Settlements

The Proper Way To Settle Merchandise Fees

I recently came across a venue in Houston, TX, while I was on the Ice Cube tour, that had no idea how to settle a simple mechandise percentage. Furthermore, they told me that I was in the wrong and this came after a day of hearing them gloat about being the best promoters - “we know what we’re doing here, we sell tickets unlike the other venues in town, we’re basically the training camp for them since they steal our employees.” Well “Bob,” perhaps if you trained them right the other venues would appreciate it a little more.
So, here we go. I lesson in the proper way to settle an evidently not-so-simple merchandise percentage so swaggies/merchies alike, if you’re doing this the wrong way take down some notes and you just might get a raise, or keep your job.

This is really simple if you can handle basic math, and I do mean basic. So here are the first few rules:

Always take the fee off of your ADJUSTED GROSS SALES.
Always check the contract for proper percentages, it varies per show/agent - its not a house standard.
Keep in mind it is VERY common for the venue fee to be different on clothing vs media.
Find out the CURRENT Tax Rate of the city you are in. I use google a lot.
Ask if the artist or venue retains the tax. If it’s the venue, ask for a Tax-ID (EIN) Number before handing over any tax. If the venue retains they absolutely have to give you this information.
In some markets such as Minneapolis there will be no tax on clothing, but everything else. Certain cities/states are unique. The only states WITHOUT any sales tax are New Hampshire & Oregon.
Always divide the tax, never multiply. (We’ll Get There)

Let’s assume that if you are doing merch, you are doing it the proper way and counted in and out, accounted for any comps and/or half-sales and you have your correct GROSS SALES and your money matches up. Okay? Good.

For this equation let’s use a safe round number and make our GROSS $1,000, the sales tax is 10% (we must be in Chicago), and the venue fee is 15% on everything we sold.

Here is our Formula.

First we find our net and sales tax:
Gross Sales / (1+Sales Tax) = ADJUSTED Gross Sales Gross Sales - ADJ Gross Sales = Tax

After this is formulated we take the venue fee off of our Net:

ADJ Gross Sales X Venue % = Venue Fee

So Artist Total Take Will Be:

Net Sales - Venue Fee

Of course, whoever retains the tax will have that added to their take. Don’t forget who retained or you’ll have an accounting nightmare.

With Numbers:

First we find our net and sales tax:
$1000 [GS] / 1.10 = $909.09 [ADJ]
$1000 [GS] - $909.09 [ADJ] = 90.91 [TAX]

After this is formulated we take the venue fee off of our Net:

$909.09 [ADJ] X 0.15 [VENUE %] = $136.36 [VENUE FEE/MERCH RATE]

So Artist Total Take Will Be (Also, lets say we retain tax):

$909.09 [ADJ] + 90.91 [TAX] - $136.36 [VENUE FEE/MERCH RATE] = $863.64 [NET SALES]

Why bother with all of this math?

If you did the quick and incorrect way it would look like this:

$1000 [GS] X .15 [VENUE %] = $150.00
$150 [WRONG WAY] - $136.36 [CORRECT WAY] = $13.64

It might not look like a lot, but ask the band youre working for if they’d like to give away $13 - chance are they aren’t too willing. Let me kick it up a notch to some real numbers to show you the difference...

I’ve done merch for bands that have done $40,000 in sales for a night. Skipping all of the math, here is a breakdown of what it would be each way on a 25% Venue Fee (sadly, this rate is normal for bands that are considerably larger. How their booking agent doesnt fight for them is beyond me.)

CORRECT WAY: The band would pay $5,454.55 to the venue.
WRONG WAY: The band would pay $6,000.00 to the venue.
A difference of... $545.45 - So yes, the headache is ALWAYS worth the extra 3 minutes of math.

Here is a screen shot of how our example looks on my spreadsheet:



And yes, I am an expert spreadsheet maker having to amend so many of them in the past. If you need a good one to use e-mail me and I’ll help you come up with one best suited for your current tour.

I hope this proves to be helpful, I know there a LOT of merchandisers doing this the wrong way, I know that I did on my first few tours - just start settling the correct way and if the venue tries to tell you that you aren’t doing it properly offer politely to call your tour manager, band manager, and booking agent for them to talk to as well. Usually they’ll realize you’re serious by that point.

Questions/Comments? Leave a comment on here or email me from my profile page and I’ll hit you back as soon as I can.

- Joseph A. Lemble

004 Best Of 2008: Extend Play

This is installment #1 of my "Best Of 2008" Lists. Please, please, note that there are so many albums that come out in a year that I do not even get the chance to listen to, that I could make a category for them alone each year. With that said, I would LOVE for you to email me or post a comment letting me know what I should check out that might alter my lists.

Here we go.

Best EP's of 2008:
Limited to my knowledge & opinion.

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5. [Tie] honeyhoney - Loose Boots

I was privileged enough to spend somewhere along the lines of 6 Weeks selling merchandise for these two amazing musicians while they opened for Lifehouse in the Winter/Spring of '08. Fantastic live and won me over night after night.


Listen To: Thursday Night, Shiny Toy Gun

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5. [Tie] Brighten - Early Love

As delicious as the cover looks if you're a fan of pop-punk and indie rock with interesting tunings and vicious melodies. There is a reason that Justin co-writes a lot of songs with the scene's most rising bands, he's got an ear for pop that he's not afraid to use.

Listen To: Carolina

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4. Streets Of Fire - The Ghost - EP

Obviously a little biased here as this came out on my label, but the songs are reminiscent of an alt-90s pop-rock that is missing in modern music while not being afraid to show a pop-punk influence. It's catchy and great to listen to. It is a perfect introduction to this band and I am very excited to see where it leads them to musically.

Listen To: Your Turn, Taking Minutes From Myself

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3. Monument Monument - Sleep Well When You Get There

A hidden treasure in the state of Michigan, this is a perfect EP for fans of Copeland, Jimmy Eat World, and The Fray. Melodies are spot on, the bass, well entire rhythm department, has you tapping your toe and wanting to sing along before you even know the well crafted lyrics.


Listen To: This Can't Be Love, You Can't Get Any Further Away

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2. The Weakend - Tornado Days EP

Again, I might sound biased but this band has come so far and down a beaten and torn path at that. This EP, sadly their final, truly showcases their potential as musicians. Intricate drums and guitar, vocals and lyrics that make you wonder what is going inside of Andrew's head... Fans of At The Drive In, Circa Survive, Thrice

Listen To: Werewolves of Detroit, Black Hole Party

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1. [Tie] Paper Route - Are We All Forgotten

An EP that you simply have to listen to and furthermore see performed live. I saw them for a month straight on the Paramore tour and my mind was blown away night after night at how well crafted each individual song was and how every moment of every song was an experience that you couldn't put into words, just music. I HIGHLY reccommend that you go watch this band live if you want to see one of the best new bands on the touring circuit.

Listen To: Are We All Forgotten

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1. [Tie] Steve Moakler - Like I Mean It

If the world of music were fair, Moakler would have long since graduated from the title of "my favorite unsigned artist," but while unsigned, he is penning some of the perfect anthems and sing-a-longs with the perfect amount of singer/songwriter vibe to them. He should be winning hearts everywhere with his John Mayer resembling songs.

Listen To: 18

003 Back-To-Back Tours

I used to complain about my work schedule all the time when I was employed at a local Pizza Hut in Toledo, I hated it even when it was built around my personal “needs.” [Needs - a word to describe my whining enough to get days off for concerts, friends being in town, or just to sleep in.] My favorite thing to cavil about was the dreaded open-to-close followed immediately by another. It was the worst. Wake up “early,” [Early - 10:00] work all day and late into the night [Late - 23:30] just to get up and do the whole thing again longing for that day off to come so you can just rest and watch repeats of Law & Order all day long, was there anything worse that the back-to-back process?

Here I sit on an airplane thirty-thousand feet in the air. We will soon begin our decent into a warm Atlanta, Georgia airport, well, at least slightly warmer than Newark, NJ and the New England states that I am leaving behind along with the end of the Mindless Self Indulgence tour. The tour was over before it started to a degree, or so it seemed. We wrapped four “quick” shows with no days off, no days to recoup, no days to worry about accounting or make sure all of our bags, which we barely unpacked, were packed up again and ready to fly with. I have today to travel between two tours, I have only today. Yesterday I was vending for MSI in New Haven, CT. Tomorrow I will be vending for Ice Cube in Atlanta, GA. The turn around between these two tours is more stress than I ever would have had to deal with at home before let alone what happened between the bookends of flights that compromised the tours and allowed them to transit into each other.

The pilot is telling us that we will be in Concourse D this afternoon, that is my queue to turn this off and pick back up when I check into my hotel downtown, on the ground.

* * *

Back on the ground now. My Thai food at the hotel was sub-par, but thats a digression at best.

The last day of the MSI tour was a bit hectic to say the least. I had to inventory all remaining merch, do all my merchandise accounting and have the money ready to turn in. Since the tour was over a weekend, I really didn’t have an opportunity to head to a bank. That took me until just before doors where I then had to advance a few shows for the Ice Cube tour. The show itself kept me steady and the band didn’t even go on until 22:45 (Remember “Late” from earlier?) The show ended around midnight and I was on the bus at 01:00. We stayed awake until we got back to NYC, helped the band get off the bus, and then dropped everything in Newark at the storage place in the bitter cold, this was around 05:00. We finished at 06:00 and then had to head back into NYC at 0930 to meet up with their manager and then accountant to settle the end of the tour. Immediately after were dropped off at the airport and now I am here, in Atlanta, Georgia - where it is not as warm as it sounds.

A lot of people try to look at me like I don’t have a real job when I go back home. They’ll make comments like “what do you have to worry about, you tour for a living, how hard can it really be?” The thing is this - it is physically exhausting to a degree you don’t imagine until you load in at 9am and load out at 1am, sleep and do it every day, with the rare and worshiped day off. It is an amazing job that I love doing far more than I ever liked my job at a pizza place, but that doesn’t change the fact that people on tour do far more work then anyone gives them credit for. Merch sellers tend to get lumped into this all time time, even amongst other crew members who don’t see the hard work we do.

Tomorrow I start the Ice Cube tour and I will try to update a little more often on more relevant topics.

Until Then,

Joe Lemble