Theater tickets cover only part of production costs
Buy a ticket to a local play and even at $25 or $30 a pop you’re helping cover less than half of the cost of putting that show on stage.
Interviews with local theater officials indicate that ticket revenue rarely exceeds 30 percent to 40 percent of the cost of producing a play.
Besides royalties, which can vary greatly, theater companies have to pay to operate and rent their building, for materials to construct a set, for renting costumes and for printing programs and tickets.
“We have incredible donors to make up the difference” between ticket income and production costs, said James Douglass, co-founder of Rochester’s Absolute Theatre. “We have to find alternative sources. We’re looking for sponsors, but so is everyone else. There’s only so much to go around.”
In some cases, a major donor will underwrite all or part of a production, while others might give to a general fund.
The costs of production start with the play itself. Depending on the show, royalties can run anywhere from a few thousand dollars to $10,000 for a major musical. Royalties are often negotiated based on number of performances and seats.
“It might be $80 to $150 a night for a drama or comedy,” said Merritt Olsen, vice-president of the Rochester Repertory Theatre. “Musicals are more.” Plus, there’s an additional fee to rent the musical score.
After a recent production of the musical “Blood Brothers,” Douglass said, Absolute had to return to the publisher all copies of the score — at the theater’s expense.
Even to make the show affordable to produce, he said, “We had to really negotiate. I had to submit our box office records. For ‘Blood Brothers’ they were willing to work with us.”
Rights to “Blood Brothers” cost Absolute less than $5,000, Douglass said. A more modern musical could cost up to twice that much.
But theaters produce musicals because the shows draw audiences, which in turn help cover expenses.
“You try to get one show in the season that will help you fund the rest of the season,” Douglass said.
“It helps to pay some of the bills so you can do something more risky,” Olsen said.
It also helps to reduce expenses, which in the case of the Rep and Absolute includes paying rent. Neither theater company owns the building in which they perform.
“Venue is a big one,” said Douglass. “There’s a real advantage to having your own location. That’s one of our biggest challenges.” Absolute rents the stage at Rochester Civic Theatre for its productions.
That’s why a long-term goal for Absolute is owning its own facility, Douglass said. Where and how, though, are tough questions with no easy answers.
“What’s difficult is finding real estate,” he said. “We have to be either downtown or in an epicenter. With theater goes restaurants, places to have a drink or a cup of coffee. But the real estate downtown is incredible right now.”
The Rep Theatre has exclusive use of a building it doesn’t own. But it does have to pay rent and property taxes.
“That’s kind of our dream, to own our own space,” said Mark Masbruch, president of the Rep’s board of directors. “That is doable.”
If, for example, the Rep would be able to purchase the building in which it performs, it could dramatically reduce expenses.
Plus, Masbruch said, “Then we could change up the theater a bit. We could do a capital drive to add seats.”
The Rep currently has 90 seats, and Masbruch said an increase to 120 seats has been mentioned.
Meanwhile, renting or sub-renting space to other arts groups represents a relatively new source of revenue for theaters. A 2016 study by the National Endowment for the Arts found that income growth for theaters is not coming from ticket sales, but rather from rentals and classes.
At the Rep, space has been rented to an improv group and to the new In Heart Theatre for rehearsals and performances. “It helps pay the rent,” Masbruch said.
Rochester Civic Theater, with its two stages and flexible lobby space, is positioned to take advantage of that trend. “Anything that increases the number of people walking in your doors raises the chances somebody is going to raise their hand and say, ‘I want to help,’” Executive Director Kevin Miller said.