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The Business of Bonnaroo

The annual Manchester music festival and its essential economic impact on Middle Tennessee. Jun 3, 2013

Written By:  Margaret Littman

Photographers:  The Tennessean

The annual Manchester music festival is more than a four-day bacchanal. It’s an essential economic engine for Middle Tennessee. Here’s a look at what the patchouli-scented windfall means to the region.

Six years ago Kevin Greenwood made a decision that may have left his West Coast competitors scratching their heads. He packed up his Southern California-based Stage Tops USA and relocated the company to what some say is now the live-music festival capital of the world: Manchester, Tennessee.

The move may seem counter-intuitive, given Manchester’s population of 10,142, its rural location between Nashville and Chattanooga, and its lack of any celebrity sightings more than 11 months of the year. But Greenwood says Manchester is exactly where his star-wattage firm needs to be.

“There are not that many big music tours in Southern California anymore because of all the big stadiums,” says Greenwood, whose company builds stages, and provides lighting and more for music festivals, wrestling events, and world tours.

While Greenwood says his business is the nation’s leader in its segment, he felt the strain of $10,000 per month in rent, plus logistical headaches when working New York and East Coast shows. Greenwood was first introduced to Middle Tennessee when Stage Tops began setting up stages for the Bonnaroo Music & Arts Festival, the annual event to be held June 13 to 16 this year. The bucolic countryside reminded him of his native England. When he saw the $120,000 price tag for a piece land that would have cost $2 to $3 million in California, he started packing his bags.

Stage Tops’ new headquarters allows it to handle shows up and down the I-24 corridor, as well as reach festivals on the East Coast, and handle tours like Taylor Swift’s without a cross-country flight. In the course of moving his business to Middle Tennessee, Greenwood relocated six employees to the area and hired three more.

Alice CooperWhile Stage Tops is a big player in its industry, it is just a small example of the kind of economic influence Bonnaroo has on Middle Tennessee. The four-day fest started in 1999 as Itchycoo Park Festival; in 2002 it was reborn as Bonnaroo. It now attracts more than 80,000 concert-goers to the rural area. While an estimated 45,000 cars drive past the I-24 exit to Coffee County daily, folks didn’t think about stopping as often before Bonnaroo as they do now. Lonnie Norman, the mayor of Manchester, says people now know where Manchester is thanks to the ‘Roo. “They put Manchester on the map.”

Phish at BonnarooA new study commissioned by Knoxville-based festival producer AC Entertainment will be released this summer (updated surveys are now planned every three years). It finds that Bonnaroo directly and indirectly brought $51.1 million to the state of Tennessee, and $27.2 million to Coffee County in 2012. That’s an increase over the 2005 study conducted at nearby Middle Tennessee State University (MTSU), which found that total Bonnaroo-related indirect and direct expenditures that year exceeded $14 million. (Some of that increase may be attributed to more detailed accounting and better survey questions rather than increased expenditures.)

Today Coffee County receives $3 per each ticket sold, totaling about $275,000, plus about $600,000 in sales tax as a result of the festival.

“We do not have to increase property taxes because we have that in our general fund,” explains David Pennington, Coffee County’s mayor. “But it is not just that they give us [$27.2 million],” Pennington says. “It is that they create jobs. We have seen an expansion of businesses next to the interstate. We had a new motel built in the last three to four years.”

The festival technically takes place in rural Coffee County, not within the city limits. So, the city of Manchester also gets some benefits, including having all the rooms at its ten hotels booked and increased tax revenues from the hotels (neither Norman nor his finance department could provide exact figures for this increase). Both Norman and Pennington say people also come back to Manchester on vacation because they first visited during Bonnaroo.

Jeff Cuellar, Bonnaroo’s director of community relations and AC Entertainment’s director of connectivity, also cites the Bonnaroo Works Fund, which bankrolls regional environmental and arts education nonprofits, as one of the important economic festival factors. Over the past decade, he says, Bonnaroo has donated $5 million to local, regional, and national charitable organizations, some of which comes from a $1 donation from each festival ticket sold. Since 2009 they have funded grant as well as given organizations new audiences by allowing them to set up in the Planet Roo area at the festival. Last year’s demonstrations included information on rain barrels and composting. A public art project in Manchester with a “Rocket Ships to Rock Stars” theme is in the works now as a result of the fund, as is an initiative to offer free energy retrofits to 100 low-income residents in Coffee County.

BonnarooAs with anything the size of this festival, there are downsides. But those involved say the chief complaints against Bonnaroo—illegal drug use by attendees and traffic on I-24—have been managed in recent years. AC Entertainment bought the Great Stage Park, the 750-acre Coffee County farm where Bonnaroo takes place, in 2007 and in 2010 built a permanent stage on that spot. The company produces mud runs and other events there, but both AC and locals alike would like to see that expand. Cuellar says country and Christian music concerts are among the possibilities for events that could take place during other parts of the year.

Sharon Holmes owns The Health Nutt, a café in Morrison near Manchester, as well as a small farm. She estimates that 30 percent of her café’s annual revenues are generated during that one financially flush week of the year. If she had a booth at the festival, she might have to shell out $4,000 to be on the grounds. Instead, the purveyor of healthy lunches and more gets hit up by those who work behind the scenes at Bonnaroo, as well as ticket-holders headed in to camp for the duration.

“You might not think it, but a lot of the people who come to Bonnaroo are very health conscious,” she says. This year Holmes also hopes to supply organic vegetables and beef to some of the on-site vendors.

Located three miles (“way the bird flies”) from the concert’s farm site, The Health Nutt starts fielding calls as early as April, with prospective customers wanting to make sure she’ll be stocked up with water and other drinks as well as healthy food to go. Associated businesses, from tow trucks to mechanics to lawn services also see an uptick in businesses during Bonnaroo. After all, this is a city of 10,000 that accommodates a crowd of 80,000 for one week a year.

Listen to our Spotify playlist with Nashville musicians playing at the 2013 festival!

FeistThis year the economic reach of Bonnaroo may stretch farther north than in the past. This is the first year that the uber-popular CMA Fest and Bonnaroo are not on the same weekend. While the audiences of the two festivals don’t overlap much, the resources used to support them do.

“We are thrilled that Bonnaroo is off of the week of CMA Fest this year and next,” says Deana Ivey, chief marketing officer for the Nashville Convention and Visitors Bureau (NCVB). “It was difficult for us to benefit from Bonnaroo as much as we could because hotels were already full with CMA Fest.”

This year the NCVB is working with AC Entertainment to offer exclusive packages—shuttles that will take concert-goers from LP Field to Manchester and back, with the option of buying single-day or weekend-only Bonnaroo tickets, rather than the all-or-nothing, camping-required four-day pass. Single-day tickets are sold only in limited quantities and only with the twice-daily shuttles as what Cuellar calls a “pilot” for future single-day tickets. But it will allow Nashvillians to pick and choose which days they want to attend Bonnaroo, and generate more income in Davidson County.

Ivey says, local firms that in the past had to choose between working for CMA Fest or Bonnaroo now can do both, meaning more of the back-end financial impact from the festivals stays in the local economy, rather than to out-of-town suppliers who would help fill in when locals were over-booked. In the past, she says, Nashville would see Bonnaroo-goers in and out of the airport, but with greater availability at hotels and on shuttles, she hopes more of those ticket holders will stay in Music City before and after the Manchester event.

In addition to the direct benefits provided by Bonnaroo, the fest, which is consistently considered one of the industry’s most influential, paved the way for other events that are now crucial to the City’s economic health. Before Bonnaroo, music festivals were just concerts. Now, attendees expect activities, education, broadcasts of sporting events, films, lectures, contests, better-than-average food, and in some cases, 24-7 entertainment.

“We firmly believe that we are pushing the bar, not just putting a band on a stage,” Cuellar says.

LudacrisBoth Zac Brown’s Southern Ground Festival in September and the new Music City Eats festival launching this year (with the endorsement of the Kings of Leon) are similar food and music extravaganzas, as is the city’s mammoth Fourth of July event.

“It has to be the right kind of festival, the right niche to have an impact on the local Nashville economy,” Ivey adds. “It has to have the right talent, plus something special added to it.”

Margaret Littman is a Nashville-based journalist whose work has appeared in Entrepreneur magazine, the Nashville Scene and many other national and regional publications. She is the author of the Nashville Essential Guide iPhone and Android app. Follow her on twitter, @littmanwrites

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