Negotiating Your Way to a Profitable Tour: A Survival Guide for Artists and (Tour) Managers (Part 1)

The Cost-of-Touring Crisis

As a comment on a recent survey by pirate.com, David Martin (CEO, Featured Artists Coalition) says:

“This research reconfirms what the Featured Artists Coalition has been saying for some time; artists are facing a cost-of-touring crisis.”

Similarly, an article in The Guardian on October 22 quoted Animal Collective saying:

“From inflation, to currency devaluation, to bloated shipping and transportation costs … we simply could not make a budget for this tour that did not lose money even if everything went as well as it could.”

That doesn't sound great, does it?
In this cost of touring crisis climate, 2 things are absolutely crucial to still be able to go on tour, without ending up with a financial headache afterwards:

1. Crunching the numbers: building a detailed tour budget with accurate forecasts for income and expenses - and keeping firm control over your budget vs actuals. (We have an early access available here if budget vs actuals is what you care about!)
2. Negotiating with suppliers: the subject of this post - read on!

While crunching the numbers to create a detailed tour budget is undeniably important, this post will delve into the often-overlooked art of supplier negotiation. Whether you're an artist manager, tour manager, or a self-managed artist, mastering negotiation can significantly impact your bottom line and overall tour experience. Effective negotiation can lead to substantial cost savings, access to higher quality services, and the cultivation of stronger, more beneficial relationships with suppliers.

However, for many in the industry, negotiation feels like a daunting task, riddled with challenges and uncertainties. Let's explore some of the most common obstacles faced when negotiating with suppliers and how to overcome them.

Common Challenges Faced When Negotiating with Suppliers

Here are 4 of the main challenges we've encountered when negotiating with suppliers:

1. Information Asymmetry: Suppliers typically have more information about their costs and pricing strategies than you do. This can put us at a disadvantage during negotiations.
2. Asymmetry in Negotiation Skills: Many artists and tour managers lack formal training in negotiation techniques. This can make it difficult to navigate the negotiation process effectively. What makes it worse, your supplier reps’ job basically consists of negotiating with people like you, while you have a thousand things to worry about.
3. Time Constraints: Before going on tour, we often have packed schedules, leaving us with little time to research suppliers, compare prices, and engage in lengthy negotiations.
4. Pressure to Close Deals Quickly: We may feel pressured to close deals quickly to secure necessary services for our tours. This can lead to rushed negotiations and less favorable outcomes.

How to Overcome Supplier Negotiation Challenges

1: Overcoming Information Asymmetry

• Gather Data: if this is not your first tour, do the work of digging up your historical spending data; this can truly be your secret weapon in the negotiation game. By analyzing past expenses for various tour elements, you can gain valuable insights into market rates, identify cost-saving opportunities, and approach negotiations with confidence.
• Ask Questions:  Don't be afraid to ask suppliers questions about their pricing, cost structures, and any discounts they may offer. While this may seem awkward, remember that asking these questions are not only in your best interest - also in the best interest of the other party. Put yourself in their shoes, and ask yourself who you’d rather deal with as a supplier rep: someone who tells you openly that they’re looking for a good deal because tour budgets are tight? Or someone who asks you to make a price, and then doesn’t buy because said price is too high? By asking questions openly, you signal trust, and you give them an honest chance to give you the best possible deal. So don’t feel awkward!
• Leverage Future Business: remember that the information asymmetry goes both ways. They know their prices and wiggle room, but you know what you’ll be buying now and in the future. A very good incentive for someone to give you a good deal today is the knowledge that more business is going to come their way in the future. And there’s no better way to make that case confidently, than to come armed with your historical data (see “gather data”). If you can show your negotiation partner that you’ve been on X tours and you’ve spent Y on their type of goods and services each tour, and that there’s no reason to believe that this rhythm is going to end soon, they have an enormous incentive to make you a good deal..

2: Overcoming Asymmetry in Negotiation Skills

• Educate Yourself: Invest some of your time reading up on the subject. There are some great and fun books on the general subject of negotiations. 2 of our favorites are Chris Voss “Never Split The Difference” and Robert Cialdini’s “Influence”. Or, keep an eye on this blog for other posts in this series!
• Practice: Practice your negotiation skills. In the end, the more you practice the better you get, and often it’s much easier to practice a skill in a situation that you don’t really care about. Why not offer yourself to a time-constrained fellow artist, manager or tourmanager who needs some help negotiating with a prospective supplier? If you fail to deliver a great outcome, at least you tried to help. And if you do, they’ll be grateful! (also see: "teamwork")

3: Overcoming Time Constraints & Pressure to Close Deals Quickly:

• Pre-Tour Preparation: Unfortunately, the biggest magical bullet for this one is to dedicate time well in advance of the tour to research potential suppliers, gather quotes, and establish your budget. This will help you avoid rushed decisions when time is tight - but we understand this may not be the most helpful tip. Still, it had to be said!
• Teamwork: There may be little calendar days left before your tour starts, but working together on your negotiations and tour budget with whomever is willing can magically create more time for you. This could be your booking agent, your tour manager, your front of house,... They may be looking for ways to practice too!

A Note about Relationships

If you are dealing with major suppliers, building relationships with key people is going to be crucial. For instance, a savvy tour director we know always requests the same sales rep at a major lighting and audio supplier. This rep, recognizing the tour manager's significant volume of business, consistently offers them preferential rates and priority service.

Once again, one of the best ways to build a relationship like that - outside of being the great human being you are and treating them with the respect they deserve - is having some numbers at hand.

These people are effectively the gatekeepers to the rest of the organization, and if they need to defend a discount to their bosses, they need to know what to tell them. Usually in a company like that, the argument “I had a good click with them” doesn’t go very far.

Conversely, “This person is responsible for X volume and here are some historical numbers to back up that claim” is something that all commercially minded people will listen to.

In Conclusion

So, the next time you're gearing up for a tour, remember that negotiation isn't just about dollars and cents.
It's about building relationships, knowing your worth, and using data to your advantage.
It can be tough, but with the right tools and strategies, you can score the best deals and keep your tour on track and in the black.

Keep an eye on this blog for more tips and tricks on navigating the wild world of tour negotiations. We'll dive deeper into this topic over the course of the coming weeks!