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Supply Chain Deposits Impacting on Festival Organiser Cashflow.

Andy Robertson

The coronavirus pandemic and restrictions on live events had a dramatic effect on the finances and survival of numerous festival organisations and this had a knock-on impact on suppliers to the industry too. Many suppliers now feel nervous about receiving payment from festival organisers and the result has been an increase in the size of deposits requested.


There is a sizeable industry that supplies music festivals with equipment and services including the backline, stages, security fencing, bathroom facilities, marquees, power generation and waste management for example. These services are essential to running a successful event and should be booked well in advance. In the pre pandemic era suppliers would ask for a small deposit and would invoice post event. This has now changed with demand outstripping supplier availability some organisers are struggling to get the essential services they need with suppliers charging much higher rates. What steps can festival organisers take to ensure they book the services they need and control costs along with the demands for larger deposits. 

Financial Planning.
The financial planning and cashflow forecasting for festival organisers has never been more important than this year. With rising prices for just about everything accurate planning is essential and this applies to all estimated supplier costs plus revenue form tickets sales, vendors and sponsors. Organisers can no longer rely on data from previous events as prices are moving rapidly upwards and for many this has also resulted in having to charge higher prices for tickets.

Negotiate. 
It's normal for auditing purposes to obtain a range of quotes for services that need to be purchased and organisers will have to asses these to obtain a fair balance. A quoted price may be lower but with a requirement for a large deposit or even payment up front. It makes sense to gravitate towards reliable suppliers used in previous years where there is a good relationship as this allows room for negotiation on payment terms. If there is a mutual trust and the festival organisation has a good record of on-time payments suppliers may be more willing to accept a lower deposit for booked services with final payment on completion.

Insurance. 
Should an event get cancelled it may be possible to make a claim against an insurance policy held. It’s worth investigating exactly what is and is not covered by insurance should an event get cancelled as many terms have been changed since the coronavirus pandemic. There are numerous insurance policies available to cover a wide variety of scenarios for both suppliers and organisers and holding a robust policy my help when negotiating payment terms with potential suppliers.

Cashflow Is a killer for many small businesses and good financial management is required to ensure sufficient funds are always available to pay suppliers. Potential solutions for festival organisers may be to obtain bank overdraft facilities or other sources of funding. Alternatively, they could launch ticket sales campaigns earlier than previous years to boost their cash funds during the planning phase. 

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
Lukas via Pexels

Andy Robertson
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