Performing Arts Groups

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 9,000 performing arts groups in the US produce live presentations by a variety of artists, including actors, singers, dancers, and musical groups. The industry includes theater companies and dinner theaters; dance companies; musical groups and artists; and other types of performing arts groups. Major revenue sources include admission fees; contracts for performances; contributions, gifts, and grants; and investment income.

Competition From Alternative Entertainment

Performing arts groups compete with a variety of alternative forms of entertainment, including movies, television, sporting events, and digital media.

Industry size & Structure

The average performing arts group operates out of a single location, employs about 8-9 workers, and generates $1 million annually.

    • The performing arts industry consists of about 9,000 groups that employ 76,800 workers and generate about $7.5 billion annually.
    • The industry is fragmented; the top 50 companies account for 32% of industry revenue.
    • The majority of firms operate within a limited geographical market. Large organizations include the Metropolitan Opera Association, the "Big Five" orchestras (New York Philharmonic, Boston Symphony Orchestra, Chicago Symphony Orchestra, Philadelphia Orchestra, and Cleveland Orchestra), Feld Entertainment (Ringling Brothers), and Cirque du Soleil based in Canada.
    • Theater companies account for about 36% of firms and 48% of industry revenue. Musical groups and artists account for about 54% of firms and 37% of industry revenue. Dance companies and other groups account for about 10% of firms and 5% of industry revenue.
    • New York City is considered the center of the US theater industry.
                                  Industry Forecast
                                  Performing Arts Groups Industry Growth
                                  Source: Vertical IQ and Inforum

                                  Recent Developments

                                  Nov 5, 2022 - Live Event Attendance Rebounds
                                  • Attendance at concerts and live events broke records during the summer of 2022, Live Nation Entertainment executives said. Executives at hotel chains, cruise-line operators, vacation-booking platforms, and other leisure companies said in recent earnings reports that the desire to spend on experiences is overcoming concerns about inflation and the economy. Lodging executives say the resilience in demand comes as Americans seek out travel and connections in person after spending heavily on goods during the pandemic. “People at the beginning of the pandemic were spending unlimited amounts on home improvement, on Pelotons, you name it, and the bloom is off that rose entirely,” Hyatt Hotels CEO Mark Hoplamazian said. “What they’re now spending on is experiences.”
                                  • Inflation, as measured by the US Bureau of Labor Statics' Consumer Price Index (CPI), increased 0.4% month over month in October, the smallest increase since July, and 7.7% year over year. The CPI measures what consumers pay for goods and services. Attendance at performing arts events may decrease if consumers cut back on discretionary purchases. Consumer spending, the economy’s main engine, grew more slowly in the third quarter than in the second, after adjusting for inflation and seasonality. The year-over-year inflation increase was the smallest since January. June’s 9.1% year-over-year inflation rate was the highest in four decades. “A strong labor market and strong job growth supports strong demand, which allows inflationary pressures to stay elevated,” said Blerina Uruci, US economist at T. Rowe Price. “You’ve got more demand chasing goods and services, the supply of which is being impaired at the moment.”
                                  • Inflation is blunting the impact of charitable giving, according to Giving USA. Consider a donor who gave $10,000 to their charity of choice in 2021. To have the same impact in 2022, that donor would have to give about $10,700. Donors are more likely to make that $10,000 gift again, however, which can blunt the impact they’re able to make on beneficiaries.
                                  • Some theater venues plan to keep virtual productions going even as live, in-person shows return. John McEwen, executive director of the New Jersey Theatre Alliance — which includes 40 member theaters — said most venues will find a way to have virtual programming going forward. “It may not be to the full extent that they did last year, but I think they are going to have some virtual component,” McEwen said. “The silver lining of virtual programming was that it broke down geographic and accessibility barriers.” People from outside the state are able to tune in to shows, McEwen said, and people with hearing loss or other disabilities were able to participate with captions and other resources — which are impossible or more difficult to accommodate in person. Theaters often charged less for watching virtual shows compared to coming to theaters in person. Sometimes they made the videos free, giving the option for a suggested donation.
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