A recent study by a charity discovered that more than 33% of music venues in the UK are operating at a loss.

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MVT’s yearly report states that more than one-third of grassroots music venues in the UK are operating at a loss.

Thirty-eight percent of the 835 locations, mostly consisting of small, independently owned establishments, experienced a negative financial outcome. The cost of rent was a major contributing factor, as venues that rented their spaces saw a 37.5% average increase in rental expenses compared to 2022.

In 2022, there were 960 local music venues, but that amount decreased by 125 in the previous year. Approximately half of these venues permanently shut down, while the other half stopped hosting live music events. An example of a well-known venue impacted by this trend is Moles, located in Bath, which has previously welcomed successful artists such as Radiohead and Ed Sheeran. The rising cost of living in recent years was cited as the reason for Moles’ closure, as co-owner Tom Maddicott pointed to higher expenses for inventory, utilities, and rent, coupled with the financial strain felt by their customers due to the crisis.

In less densely populated areas, grassroots venues face particularly challenging circumstances. In towns with a population under 200,000, these venues are experiencing an average loss of 2.5%. While the overall turnover for the grassroots sector has increased by 15%, the average expenses have also risen by a similar amount. This results in a profit margin of only 0.5% for running these venues, which are often considered crucial to the UK music industry.

According to the MVT, grassroots venues prioritize music as their main focus, are willing to take risks with their cultural offerings, and book artists based on their talent rather than potential financial gain. These venues differ from more commercial ones that primarily host well-known acts. In 2022, there were 28,223 employees in grassroots venues, a decrease from 30,720.

Mark Davyd, the CEO of the charity, urged political parties in the UK to make commitments to the sector during their election campaigns. He also called on larger venue groups and concert promoters to contribute to the funding of research and development that supports emerging artists who eventually become popular and successful. Davyd emphasized the need to stop making excuses and demanded action from those who have the power to prevent the destruction of the sector.

A report from PricewaterhouseCoopers in June 2023 projected a 7.4% annual growth for the UK’s live music industry until 2027, with the market reaching £1.63bn in 2023 compared to £1.54bn in 2019.

In 2022, UK Music reported that the sector experienced a growth of 14.4 million music tourists, defined as individuals who have traveled at least three times the average commute distance in their region. This number included 1.1 million tourists from other countries, who collectively spent £6.6 billion on various expenses such as transportation, lodging, and other activities aside from ticket purchases and venue fees.

A potential solution to assist the industry is implementing a fee on all gig tickets in the UK, with the funds going towards grassroots venues. A popular band advocating for this approach is Enter Shikari, who have pledged to donate £1 per ticket from their upcoming arena tour to support smaller venues through MVT.

In November 2023, John Whittingdale, a former culture secretary and Conservative MP, was asked about plans to support the sector. He stated that there are no plans to implement a ticket levy and that there are ongoing discussions led by the industry to provide more support for grassroots music venues through larger events and venues. He also mentioned direct support from the government’s Emergency Grassroots Music Venues Fund during the pandemic, as well as an additional £5m allocated to Arts Council England in November for a Supporting Grassroots Music fund.

In addition to providing financial support to vulnerable venues, MVT has also expanded its efforts to include venue ownership. Through the Music Venue Properties program, the organization collaborates with the community and raises funds through crowdfunding in order to purchase the freehold of buildings and ensure the long-term sustainability of venues. The first venue acquired through this initiative was The Snug in Atherton in October 2023. To date, community shares have raised £1 million for the overall program, with an additional £500,000 from Arts Council England, loans totaling £650,000 from the Arts and Culture Impact Fund, and donations from music industry companies.

Source: theguardian.com

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