SECTOR SERIES: Arts & Entertainment Survival

SECTOR SERIES: Arts & Entertainment Survival

April 1, 2020

The Show Must Go On – Surviving Coronavirus

Armageddon for the world of arts and entertainment came as the government unveiled a series of the crisis management version of the coup de théâtre. First people were told to stay away from places of entertainment, then days later each and every one of our cinemas, theatres and live music venues was ordered to close at almost no notice.

The result has been devastating, despite the deployment of an Armada of business support packages. Loans and grants are being showered on us like first night flowers at an opera house. Arts and entertainment locations stand eerily empty, productions in mid run, gigs cancelled and exhibitions pulled.

The awful reality is that these businesses now have zero revenues and the bills for their costs just keep rolling in. The outlook looks bleaker than the final scene in any Shakespeare tragedy. But is it? Surely this most creative of industries can write itself a happy ending?

What support is available?

First there are all these government schemes to provide cash. The offer of support is welcome, but be wary in particular of the loans on offer. Initial indications are that at least one of the banks providing them for the government is asking for unreasonable security, including personal guarantees and even a charge over the directors’ houses. Besides, until the future becomes clearer, how does anyone know if the loans can ever be repaid.

A safer option might be to copy what some restaurants are doing very successfully, which is to raise money from your fans and supporters through crowdfunding. Alternatively, many arts venues have extensive lists of annual donors, some music clubs have membership lists. Maybe worth tapping them up for some extra support?

Some of the major costs can be ignored. Those outrageous business rates aren’t payable for the next year. You also have added leverage in discussions with the landlord. Many leisure businesses are asking for a three month rent holiday, but now the government has legislated to prevent landlords from evicting tenants for non-payment of rent and you can very reasonably point out there’s not much else that landlords can do in this scenario to find replacement tenants for such specialised premises.

Staff are vital to the success of all arts and entertainments businesses, whether behind the scene or front of house. Even if you had already laid off people, get them back, put them on furlough and claim the government’s 80% grant towards their pay.

Keep in contact with your customers

But, the most important thing is to maintain contact with your customers. It’s an old cliché that the biggest tragedy in London’s West End is a ‘dark’ theatre. You must keep your venue in the public’s mind, whether it’s by email, on social media or best of all by live streaming output, whether new or recorded. The iconic jazz club, Ronnie Scott’s streamed a live gig this week – no audience in the club, but thousands out there in cyber space. Many theatres are streaming live performances or filmed versions of previous productions.

It’s difficult to monetise this live streaming, but you can ask for donations and the likelihood is that people will be generous. Theatre and gig goers will be desperate to do their bit to ensure there’s entertainment when all of this is over.

Get cancelled gigs or shows rescheduled and honour existing tickets for the later date. Most diehard fans will be happy with that. The last thing you need is to be refunding thousands of pounds in ticket presale revenue.

Most of all, you will need performers when we finally get through this. In many ways, they’re the hardest hit in this crisis. Almost all are self-employed and most will struggle to survive on or even to access the much-delayed financial package for them. Fortunately, all sorts of initiatives are springing up to support them by putting home concerts and performances online, seeking a financial contribution of one sort or another. With modern technology, it’s amazing what high quality material can be created even from domestic self-isolation.

With wit and determination, the Fat Lady can surely be persuaded to stay silent and let this wonderful industry survive and thrive once more.

If you would like to speak to a Partner about issues raised in this article, please call or email us at our nearest office to you.