Arena Management .4

Accounts payable:

(to which the facility owes payment) should be managed as diligently as accounts receivable.

Cheap trick- Ottawa blues fest 2011:

3 injured including band manager and a guitar tech Did not remove the wind flaps prior to the storm Stage hands were not properly trained on how to remove the flaps correctly and had to try and cut them.

P&L (Profit and Loss Statements):

A Profit and Loss (P & L) statement measures a company's sales and expenses during a specified period of time (in our case we do one for every event). The function of a P & L statement is to total all sources of revenue and subtract all expenses related to the revenue. It shows a company's financial progress during the time period being examined. It is a good tool to use when you are looking to book/bring in another similar or the same act. Should help you tighten up your bid sheet (offer).

Financial management:

A venue manager has two customers- the customers who rents a venue, referred to as the promoter, producer, presenter, or/ team, and the customers who attends events in a venue, referred to as the guest, customer, client, or attendee. There are also two types of revenue streams that links up with a venues "customers". There are revenues directly associated with promoters and customers Venue management requires the ability to forecast and to manage expenditure for purposes of accurately forecasting financial performance. (adjusting the budget every month by accounting for any negative variances before they become a major year-end problem.

Space:

As people are pressed closer and closer together, they actually move slower and slower. Pedestrians' densities, which approach the critical density at 8 person, less than 1.5 ft. per person, leaves no space between people. In this situation, shock waves, causing individuals to move involuntarily, can be seen moving through crowds.

Walk-through metal detectors:

Becoming a new industry standard Statically they allow guests to enter more quickly and effectively than hand wands (500 guests per hour)

Current event:

Borussia Dortmund - Germany soccer club Before championship league quarterfinals match 3 explosives devices were set off near team's bus (one failed to go off) One player injured Additional 80 officers deployed around the hotels and key routes for rest of the matches Enhanced security

Typical documents needed at the settlement include:

Box office statement detailing tickets distributed, sold and not sold. Invoices from the facility documenting production, security and contracted or in-house labor required by the event and provided by the facility. Invoices concerning equipment owned or secured by the facility but used by the event (maybe produce to show cost savings vs. other venues). Production, catering and advertising bills (with backup). Invoices for anything else asked for by the event and provided by the facility.

Walk-through metal detectors info:

Costs: $2500 - $5000 per unit Does not always include the ancillary (but needed) items such as hand held wands, charging cables, weather structures, or other infrastructures Increase the number of needed security personnel dedicated to gate security Removes the physicality of gate security however

Crowd managers:

Crowd management personnel must be thoroughly familiar with the venue, including normal entry and exit points, as well as emergency exit doors Emergency exit doors should be monitored to ensure that they are unlocked and unblocked.

Psychological:

Deals with the humanistic factors of crowd management.

All receivable accounts should be frequently reviewed to verify payment:

Delinquent accounts should be notified. If debt is still not paid, the debt should be removed from the facility's accounts receivable. It can be declared uncollectible and written off.

What are the segments of financial management:

Developing the facility budget and capital expenditure budget Monitoring the facility's operating budget Developing financial reports Developing rate ad pricing schedule Monitoring and developing contracts Accounts payable and receivable Monitoring and managing ancillary and non0ancillary revenue streams Managing internal audits Event settlements Purchasing Audit controls for cash operations (parking, concessions, merch and tix office)

Need to identify key requirements for your facility:

Durability and mobility User-friendly for on-going training Low false-alarm rates Permanent locations? Battery or cord power Zoned areas Sensitivity

Perform communications functions:

Employ good listening skills adapt communication to crowd diversity follow supervisor instruction keep communication relevant utilize event/facility terminology maintain integrity of confidential information

Event budget:

Estimated number of events by specific event type. Number of event days for each event type Average attendance Average ticket price, if applicable Estimated gross ticket sales. Rental income or co-pro profits Estimated revenue based on per caps (concessions and merchandise) Parking fees. Surcharges on ticket sales, if applicable Other revenue based on facility service charges Sponsorships. (get it prioritize, each one (revenue and expense wise on the event))

Zero based budgeting:

Evaluates existing programs alongside new programs and requires yearly funding justification for each Allows managers to deal effectively and sufficiently with programs that have outlived their usefulness or that are simply not producing the desired results related to programs objectives Downside if that though that all funds in each budget category based on a fear that failing to do so will result in the next FY budget being reduced accordingly.

Security:

Exterior security: Bag search, pat downs, wands, walkthrough Interior security:

The station - Rhode Island 2003:

Fire started by pyro set off my the tour manager that ignited the plastic based sound proof. 100 individuals died. 200+ injured

AEG Worldwide/Bowery presents merger:

Global promoters AEG Live has acquired successful New York based independent Promoter Bowery Presents Bowery has formed strong ties with artists, managers and agents in moving acts up the ladder. Bowery owned the Bowery Ballroom, the Mercury Lounge, and Terminal 5 amongst other venues. The new company just signed a significant leases on new properties to house their new offices.

Energy:

High energy crowd are much more likely to press into small spaces, creating the potential for trampling or crushing. Reports of person being literally lifted out of their shoes and of clothing's being torn off are common in uncontrolled crowd situations.

Conflict identifications and mitigation:

Identify and report potential problem guests Seating/ticketing problems Resolve guests complaints/problems Avoid arguments with guests

Promoters related ancillary revenues includes:

In house marketing team and advertising agency fees. TV, radio, and CC services and fees (organization, connection, equipment, and production fees). Utility fees. Labor charge back fees Space rental Equipment and utility fees.

Cost control typically includes:

Investigate procedures to detect variance od actual costs from budgeted' Diagnostic procedures to ascertain the cause(s) of variances Corrective procedures to affect realignment between actual and budgeted costs.

Direct Labor vs. Indirect labor:

Labor is common expense for all facilities and all events. Direct labor represents wages paid or owed as a direct consequence of an event or activity. Indirect labor represents wages paid or owed as an indirect consequence of an activity such as general admin, equipment repairs, specialized employee training, consultant fees, etc. These are general reported as general overhead.

Types of budgeting:

Line item budgeting Performance budgeting Zero based budgeting

No shirts for you:

Live nation is making sure there is no bootleg merchandise being sold outside MSG during the John Mayer Show (WED-April 5th) Company got a temporary restraining order banning street vendors from selling any merchandise with Mayer's logo or likeness before or after his show within a 4 mile radius of the venue. NYPD has a special task force to deal with this type of counterfeit gear.

Exterior security:

MLB mandated metal detectors in 2015 NHL mandated use in 2011 NFLL mandated use in 2011 (super bowl since 20002) 2013 no purse rule.

Major emergency response:

Maintain guest safety as priority Assists guest with special needs Follow appropriate instructions applicable to the situation (fire, weather, terrorism) Participate in drills Execute assigned tasks or responsibilities as provided in event of an emergency Provide appropriate information

Line item budgeting:

Most common format Is a systematic, accounting oriented method of recording expenditure against various classification categories such as salaries, utilities, suppliers, equipment, etc. This allows the business manager details control over facility expenses.

Operating Budget .2:

Net income after expenses from food and beverage, parking, and catering, along with those generated by facility rental, sponsorships, naming rights, specialty seating, co promoted and promoted events, ticket convenience fees, advertising, signage, merch sales etc may contribute to funding the facility's operating expenses AND may set aside some cash reserves for future capital improvements. Personnel (Salaries & Benefits) and utilities typically make up the largest part of a venue's operating budget.

Mixed overhead costs

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Operating/income statement Direct costs Indirect costs.

Operating statement show income and expenses by category Direct costs are expenses items that can be identified specifically with a single cost item such as insurance, basic utilities. Indirect costs are expense items that cannot be identified Indirect costs are expense items that cannot be identified specifically with a single cost item such as general administration, utility usage and overtime wages not related to a specific event.

Rent can be done in several fashions:

Percentage of gross ticket sale Percentage of net ticket sales Flat rent Rent caps Rental structures: $3500 vs 12% with a cap of $50,000 Co-promotion: rent equals the percentage split of the net revenue after both the facility and promoter expenses and deducted.

Performance budgeting:

Performance measure are used as the basis for budgeting and comparison of efficiency in production Focus is on activities of the operations rather than objectives. This approach stresses efficiency through relating money request to organizational output.

Information:

Perhaps the most powerful tool when it comes to managing a crowd. Information must be fast, accurate, and often. The best source of information is bright, easy-to-read above the crow signage that directs guests and helps set their expectations.

The budgetary process usually flows through four developmental stages:

Preparation Presentation Adoption Execution

Crowd management (There are three major areas of focus in crowd management)

Psychological Physical Environmental

There are a number of ways to control energy:

Slow music, lengthening the rout a crowd must follow, the visible presence of uniformed security.

More competitive? Tax credits to tour:

The Georgia senate has endorsed a tax incentive meant to grow the music business in the state. The music tax credit is starting out small, but that the industry could grow, just as the film industry has done has since the passage of a tax credit Tax credit would help talented Georgians from moving to other states for music careers, and that producers would rent Georgia venues for practicing shows to take on the road The credit in house bill 155 would until a maximum of 15 million in 2020.

Return to North Carolina:

The NCAA said today it will no longer ban North Carolina from hosting future championships now that the state has partially repealed its "bathroom bill" The NCAA board of governors "reluctantly" voted to allow consideration of cities in the state The H2B bill has repealed last week, but cities won't be allowed to enact their nondiscrimination's policies until 2020.

Safety (national fire protection association):

The NFPA requires that public assembly facilities conduct annual life safety evaluation. The evaluation should be written assessment of safety measures for conditions as listed in NFPA 9-4.5.2.

Bid Sheet:

The bid sheet is the "official" offer you send an agent. It will list the financial offer, travel and production options as well as your projected cost estimates. It also will show the gross potential (total revenue from ticket sales on a sell out) as well as the potential money that the artist and promoter may make if it goes into percentage. You go into percentage when you sell enough tickets to cover all expenses (break-even). This can be loosely referred to as a show "budget".

budgeting process:

The budgeting process can be complicated; historical revenue and expense data related to the facility's event activity and ops, assessing and projecting the facility's position in current and future markets, establishing goals and objectives that are consistent with the facility's mission statement, and understanding the overall economic and political environment.

Operating budgets:

The development of a detailed operating budget is the key first step in managing a efficient and effective venue and/or organization The next step is the process or activity of controlling costs.

Time:

The more people you must serve or the shorter the time period in which they must be served, the more facilities that will be needed, i.e., access and exit points, wider corridors etc. The most dangerous times are as crowds are arriving and leaving (moving crowds).

NFPA:

The national fire protection association life safety code 101 and 102 regulations requires that there be assigned to each event person who is trained in crowd management for every 250 spectators in attendance.

Operating budget:

The operating budgets (money allocated to cover the operating expenses of the facility) have similar expenses such as mgmt. salaries and benefits, full and part time wages, utilities, janitorial and maintenance supplies and a variety of admin expenses. The operating budget identifies operating expenses, the resources allocated to fund them and provides a mgmt. team with a monthly report and analysis of current and YTD (year to date) revenue and expenses as compared to the actual budget.

Interior security:

The type of the event, facility make-up and event requests will generally be the most significant determinants of the number of security personnel needed. The size of the crowd is relatively easy to estimate quite accurately when majority of attendees are season ticket holders and/or the event is sold out. It is less easily estimated when managers have to rely on how many tickets have been sold to date at the time they arrange staffing.

North Carolina repeal of the HB2 law:

This morning lawmakers in NC said they reached an agreement to repeal the costly and highly criticized HB2 (bathroom bill)

Customers related ancillary revenue include:

Ticketing fees (facility fees usually between $0.25 and $3, ticket service charge, VIP orders, reimbursement expenses from promoters like charge backs for cost of box office labor, groups sales, associated material costs). Food and beverage Merchandise (flat rate, per person, percentage of sales). Parking (valet services, bus services - cost sometimes billed to the event/promoters) Business service center Telephone, network and wifi connection

Crowd behavior (There are four elements that shape crowd behavior):

Time Space Energy Information

NFPA There are 9 training components of a crowd manager:

Training Assisting guests implementing facility/guest policies and procedures risk management crowd dynamic knowledge of events and facilities Conflict identifications Perform communications functions Major emergency response:

common environmental factors to consider:

Weather Expected patrons arrival time Demographics History of crowd Age groups: does the show attract 30, 40, 50 year olds? Ticket demand What is at stake: is there something at stake for the winner of the events?

Sugarland- Indiana state fair 2011:

Wind gust (60mph): Stage temporary roof structure collapsed. 7 people died 58 were injured $50 million in settlements.

Current Event permit to carry:

Would allow Arkansas citizens with a permit to carry firearm almost everywhere in the state (including arenas and stadiums). The SEC stands behind a proposed exemption to not allow guns in college stadiums. The bill is set to take effect in September just in time for football season).

Crowd dynamics:

adjust crowd demographics anticipate crowd activities and behaviors make guests aware of their responsibilities observe crowd for potential problem monitor flow of crowd recognize potential crush indentify crowd behaviors (changing)

sing the detailed operating statement in tandem with the current budget ______________________________________________________________________________________________________________________________________________________.

allows the business manager to determine whether the facility is performing better or worse than expected based on variances from the budgeted figures to the actual figures.

Creating of accurate and timely financial statements (income statement, balance sheet, detailed operating cash flow statement and capital expenditure statement)__________________________________________________________________.

are necessary for the overall effective management of the facility.

University owned arenas and stadiums generally gain revenue through _________________________________________________________________________.

assessing mandatory student athletic and/or activity fees.

Training components:

attend orientation fulfil specific training requirements attend pre-and post-briefings job assigned training follow chain of command participate in on-going training

Settlements include the presentation and payment of:

bills for labor, transportation, rent and catering; reconciliation of tickets and writing checks or making bank wire transfers.

Fixed overhead costs:

debt service, service contracts and professional services are constant; fixed overhead totals use a factor of operating event days or operating hours.

Foundations also may have some ________________________________________________________________.

donations to supplement the operating budget.

Environmental

environmental deals with items that alter the living environment, stemming from both human and natural causes

Publicly owned facilities, especially those constructed with an expectation of increased tourism, usually look toward the:

hospitality industry (hotels, motels, restaurants, vehicle rentals, etc) for assistance in covering operating deficits (includes dedicated taxes).

Risk management:

identify safety hazards mitigate safety hazards confirm assigned area's readiness to supervisor report incidents and property damage identify medical emergencies do not create hazards

The detailed operating statements show _______________________________________________________________________________.

income and expense by category and allow the tracking of each item of revenue and expense to its source.

Variable overhead costs:

indirect labor and supplies, change in proportion to the activity; Variable overhead totals use a factor of occupancy loads to determine the cost per patron.

common cause of physically based crowd management difficulties:

late event start performer no shows festival/general admission seating poor or inadequate sound and lighting systems

Implementing facility/guest policies:

learn policies and procedures apply appropriate policies and procedures observe violations, inform guests of policy and consequences report violations report problems not addressed in policies and procedures to supervisor

Assisting guests:

maximize accessibility to guests anticipate needs use good service techniques answer questions or assist in finding answers provide direction respond to concerns

Physical:

physical elements deal with all the physically alterable aspects of the environment

Knowledge of event and facilities:

review schedule review venue/event diagrams review event specific policies and procedures event seating requirements identify key event/facility personnel maintain control of limited access areas

There are many ways to upset the patrons' psychological environment. Several areas of concerns are:

smoking regulations enforcements aisle restrictions enforcement contraband and alcohol enforcement (patron search and seizure)

The income statement reports for a specific period of time those items _____________________________________________________________>.

that provide the total revenue, total revenue and the resulting net income or loss.