Financial Planning for Music Festivals.

Having poor financial planning and budgetary control has been the downfall of many music festivals no matter how well intended they were. What steps can festival organisers take to ensure that they have robust financial processes and procedure in place to avoid future financial difficulty or event cancellation.

Not many music festivals originate from qualified accountants so it's not surprising that many can face financial problems but there are some essential steps that organisers could take to cover their lack of budgetary understanding. Having financial experts and accountants involved at an early stage is a key part of the planning process should be a priority but there are other considerations too. 

Planning. 
Planning any music festival can take between 1 and 2 years because there are so many aspects that need consideration. Fully understanding the operational costs involved and accurately forecasting ticket sales plus sponsor and vendor revenues at an early stage will establish if a proposed music festival is even financially viable. 

Cash Flow.  
Having a positive cash flow is essential to keep any business going and not forecasting accurate cash flow over the next 24 months can lead to situations where suppliers and artists don’t get paid leading to a possible collapse of the festival before it even takes place.

Contingency Planning.
Every financial forecast should include contingency funds available for unexpected expenses and music festivals do seem prone to unexpected events occurring. If a selected supplier suddenly becomes unavailable and a new supplier needs to be sourced, they may charge more than was quoted by the original supplier for example. 

Source of Funds.
Irrespective of how the music festival originated there must be investment from somewhere to get the process started. It would be sensible to not limit any investment to a single source but to line up a number of investors who are willing to finance the upfront operational costs that will be incurred in return for a share of future profits where the risk is shared.

Staffing. 
One of the most expensive investments in any music festival organisation is the full-time staff costs and it is essential that anyone recruited is experienced with a good track record of organising and running music festivals. Having these key staff on board at an early stage will also boost the confidence of any potential investors. In addition, they will probably have the necessary supplier contacts and can probably negotiate the best rates.

Any new festival starting out can explore alternative options by looking at using one of the many professional event management agencies who make their living out of organising music festivals. These agencies can work with a given budget and organise all the supplier logistics, artists, sponsors, vendors and ticket sales to deliver a festival within budgeted costs and generate a profit.

For festival organisers planning their events using a software management platform like Festival Pro gives them all the functionality they need manage every aspect of their event logistics. The guys who are responsible for this software have been in the front line of event management for many years and the features are built from that experience and are performance artists themselves. The Festival Pro platform is easy to use and has comprehensive features with specific modules for managing artists, contractors, venues/stages, vendors, volunteers, sponsors, guestlists, ticketing, cashless payments and contactless ordering. 

Photo by Malte Luk, Pexels

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