Rate Increase...

Today, I mailed out 32 letters to locations where I regularly perform. Here's a copy of the letter:

Travlin' Easy Productions
Gary Diamond
(my address, etc...)

March 21, 2011

TO: All Activities Directors and Program Directors

After decades of maintaining the same fee schedule, I must, unfortunately, increase my musical performance rate by 25-percent in order to offset rapidly rising production costs. The massive increases in fuel, transportation, liability insurance, equipment insurance, new equipment, repairs and maintenance, and other business expenses associated with providing musical entertainment have been overwhelming. The rate increase will be effective June 1, 2011.

I sincerely hope this fee increase will not have an adverse effect on our current performance schedule, or produce a financial hardship for any of my clientele. If there is a problem, please feel free to call me at any time.

Sincerely,

Gary Diamond

I hated to send the above letter(s), but after doing this year's income tax returns I realized that at the old rate I would be loosing income if the rate was retained. And, after talking with several of the ADs during the past few weeks, they all said the increase was no problem and the schedule would remain the same.

Doing the math at income tax time really opens your eyes to the overall impact of rising fuel costs--everything takes a bad hit.

Gary

Gary, an increase in rates is well-deserved. I would worry that, in an industry that takes the absolute cheapest route possible (a recent Federal Report found out that many of the homes around the country don't even stock enough bibs and don't wash the ones they have often enough) that some places may opt for less expense. Around here, there are plenty of people who will play for $100-75.00 and even more that will play for less.

Of course, this area may be unusual. Around here the folks who play nursing homes really couldn't do anything else.

That's obviously not the case with the "Zoners" who play these venues.

Good luck with your price increase.

Russ

Let me attempt to carefully criticize the business decision and not our beloved Mr. Diamond...

I've had the same conversation with several AD's in SW Ohio. Two primary complaints.

1) Performers changing their prices mid-year: At some point the client and performer agreed upon a price and term for the dates involved. I've heard firsthand that some AD's felt "we had a deal" and that announcing a price change was unprofessional. I've been asked what if the AD's sent out a letter saying, "We're sorry, but due to circumstances beyond our control, we'll be reducing all the pay for entertainment by X %, effective such and such a date." How would I like that? Its happened and I didn't like it. In some cases I stayed on, in others I left. Other factors influenced my decision.

Also, let's not confuse entertainers and corporations. Some entertainers try and be totally fair with regard to prices and go out of their way to work with AD's. Others, however, grossly overcharge, under-perform, etc. and gouge NH's as much as they can. Corporations really don't worry whether we like it or not. Its business, not personal. Knowing Gary, this is apples and Volkeswagons. Gary knows names, stories, etc. better than most of the Corporate/stuffed shirt types do.

Given the long term relationship Gary's had with his clients, I'm still surprised that he didn't deliver the intentions face to face. THAT, I think might have been the best way to handle it. Not the only way, but IMO, the best way.

2) Entertainers citing transportation costs/gasoline prices as justification for raising fees: This is a huge irritant to many AD's in the Dayton market. A few years ago, when gas shot up to almost $4.00/gallon, several acts upped their fees by 20-25 bucks per gig. They described it as a "temporary price increase due to market conditions beyond their control." Most AD's went along with it. However, a few months later when gas prices dropped back to the $3.20 range, most of these acts refused to drop their fees back to their previous levels. Some survived, but others lost dozens of gigs because of it.

Don't forget that the IRS upped the mileage reimbursement rate several cents that year for business travel. Further, if you're organised, you should be able to write off a great deal of your business related expenses.

Again, I think Gary knows his people/clients as good as anyone, so if that's how he felt it should be handled, great. I imagine anyone who did call him with a concern would be accommodated rather quickly. From a sheer business point of view, I'd advise anyone to tread carefully when thinking about independently changing the terms of an agreement. Our word/handshake has to be absolute...bad market conditions or not.

Good points Bill. I actually did tell each of the ADs in person that the rates would be going up this year, and I informed them in person last October when I booked the 2011 season. Additionally, I told them I would try to hold the rates at last year's level for at least the first six months, a promise which I kept. They all agreed.

Also, in last year's contract, a new clause was added that said "Rates subject to change." The clause was highlighted and printed in bold print so it would not be missed by anyone reading it.

My pay rate has not increased since my days of picking an acoustic guitar and singing in smoke-filled bar rooms. That was more years ago than a lot of Synthzone members have been alive. Back then we didn't need equipment insurance, didn't require liability insurance, most of the places provided free meals and drinks, and the tips often provided as much or more income than the restaurants and bars payed in salary. The only thing that is the same today as it was back then is the pay scale.

When I talked with the ADs again about the price increase, they all agreed that it was about time. Additionally, they said there were only a handful of entertainers they could rely upon to provide the residents with quality entertainment every time they performed. There is only about 5 guys in my immediate area that are on their go-to list--I'm fortunate enough to be among them.

Now, there are some facilities that have taken tremendous hits with their budgets. Only one has called and cut the schedule. However, they called before the letter went out. And when I performed there this past week, they offered to increase the pay by 50-percent because they felt bad about having to cut the number of performance days.

Like I said, some good points to consider, Bill,

Gary

I had no idea that liability insurance was required to play at some of these places.

Premises liability and the owner's/tenant's personal liability is covered under their package policy. However, any property damage or bodily injury caused by the entertainer is their responsibility.
Bernie