Business management

Event horizon: how the Scottish events industry is set to bounce back

The events sector has suffered more than most from Covid-19 – but moves are afoot to get up and running, with entrepreneurship and innovation being key.

Derek Martin is festival director of Terminal V, an Edinburgh music event running twice a year. “We were experiencing terrific growth – from 2,000 to 20,000 capacity in the space of three years – and then of course we had to cancel our Easter event. Whilst we were hoping to reschedule to Hallowe’en, we’ve just had to postpone that as well.” 

For any festival organiser, it’s the worst-case scenario to have to scrap your event, and Martin speaks with heartfelt understatement when he says it’s been “a rocky ride”. “I saw events having to cancel last year due to high winds and really felt for them, with no idea that something like this was coming. There’s just no realistic way we can pivot a business as things stand; other businesses can bring in social-distancing measures, but that just doesn’t work for music events and festivals.”

Future thinking

Donald MacLeod is MD of CPL Entertainment Group, which owns the Cathouse, Garage and Tunnel nightclubs in Glasgow. The issue for MacLeod “is not so much the call for a roadmap, as how we can get to that roadmap. We do have roadmaps for manufacturing, hospitality, retail and transport. They may be baby steps, but for the night-time economy and events it’s even smaller than baby steps, because there’s the belief that events and nightclubs are going to spread the virus too much”.

For him, this is a misguided view, for three key reasons.

“Firstly, the students are coming back this month, from all over the UK, and if there are no events for them to go to there will be unregulated house parties, large gatherings without any track and trace, and illegal raves. It’s just not truthful to believe that this won’t happen because it will.” Such an outcome is more dangerous, MacLeod argues, than trialling licensed establishments – “where you can keep an eye on numbers and sanitise effectively”.

This brings him to his second point: “With a few tweaks we can try to make going to events as safe as going to the shops.” The emphasis has to be on trialling. “We need to experiment and see what works. There’s still the problem about reduced capacity meaning it’s hard to make events viable financially – from here it’s about calibrating and fine-tuning. The trialling is to try things out and that’s the only roadmap I can see before Christmas.”

By seeing events, and by extension entertainment, as unnecessary or something you can do without, you are trivialising something that’s very important to our society

Donald MacLeod
MD, CPL Entertainment Group

The third issue is the impact on mental health – of the general public as well as employees and performers. “This is a catastrophe in waiting. By seeing events, and by extension entertainment, as unnecessary or something you can do without, you are trivialising something that’s actually very important to our society. The vast majority of people like going out and they need it for their soul, their health and their well-being.”

To begin with, will events need to be relatively small-scale and take place outside? “Well, we’re pretty hardy souls and we’ll take our shirts off, but beyond October the weather is not going to make outdoors events viable, however well-ventilated you want things to be.”

Online events offer a way for musicians, performers and creators to continue to reach audiences, but this has limited viability for music events. “We did run some online gigs around Easter with acts that were supposed to perform at the festival,” says Martin. “But that wasn’t really about generating income, it was about trying to give something back to disappointed customers. It’s helpful for long-term brand awareness but not a significant revenue generator.”

Also, he says: “Unless you’re a huge international festival, you might be shooting yourself in the foot asking customers to pay. If you can find sponsorship to cover costs, that would be a better approach.”

Furlough and the Self-employment Income Support Scheme

There is an indicative date of 14 September for indoor events, but this seems optimistic and will still restrict numbers. And closing the furlough schemes at the end of October “is going to be tricky”, says Martin, particularly as employers are now required to make a contribution of 10%. “We either have to take a leap of faith and hope things will return to normal next year; or we’re going to have to make staff redundant and then rehire. This is a real pressure – everyone in the events industry is looking for the timeline.” If the furlough scheme is not extended, he says: “We will need some kind of additional support from government; otherwise, there will undoubtedly be unemployment.”

MacLeod gives an example: “You could underwrite the costs of insurance, for instance. If, and only if, an event gets cancelled, then the government steps in.” That way, MacLeod says, organisers can start to plan. “Festivals and music events take months to arrange. If you know there’s going to be help in the event of another spike, that will give organisers confidence, and for people to work together in partnership. The organisers; the staff; the operators; the public; and the government. That active partnership will be key and, if so, we can make a success of 2021.”

Within the past couple of weeks, VisitScotland has announced a £6m fund to help the events sector with cash flow. The Events Industry Support Fund is a one-off grant of £10,000 for businesses that are facing hardship, awarded on a first come, first served basis. The newly formed Event Industry Advisory Group (EIAG) is helping develop the fund, which is delivered by VisitScotland on behalf of the Scottish government as part of a £10m package of support. As well as live events, it will help conferences and exhibitions, and it includes support for supply chain workers.

“Events by their nature involve a diverse mix of businesses that do not operate in isolation,” says Paul Bush OBE, director of events at VisitScotland. In VisitScotland’s recent supply chain survey 57% of respondents said they are 100% reliant on the events sector for their turnover, with a further 26% relying on events for over 61% of their business; “so ensuring their survival is paramount”. 

While the sector “contributes in the region of £6bn to Scotland’s economy”, Bush points to green shoots “with the return of women’s professional golf and professional football, as well as some outdoor events with limited numbers”. That limitation is currently 200 people.

Meanwhile, Derek Martin is now looking at other ways to expand the business. “We’re creating a new festival in Berlin in February 2021 – and we’re launching travel packages to go alongside that. We’re actively trying to think of new and exciting things.

“We are very confident that, when the pandemic is finally over, there will be a huge boom in the industry. We’re hoping to grow to a two-day festival, launch international events, and work on making it bigger and better. That’s something that will be reflected across the industry, and it will be thriving.” 

This material is published by NatWest Group plc (“NatWest Group”), for information purposes only and should not be regarded as providing any specific advice. Recipients should make their own independent evaluation of this information and no action should be taken, solely relying on it. This material should not be reproduced or disclosed without our consent. It is not intended for distribution in any jurisdiction in which this would be prohibited. Whilst this information is believed to be reliable, it has not been independently verified by NatWest Group and NatWest Group makes no representation or warranty (express or implied) of any kind, as regards the accuracy or completeness of this information, nor does it accept any responsibility or liability for any loss or damage arising in any way from any use made of or reliance placed on, this information. Unless otherwise stated, any views, forecasts, or estimates are solely those of NatWest Group, as of this date and are subject to change without notice. Copyright © NatWest Group. All rights reserved.

scroll to top