Levity performs during the first indoor show at The Shed music venue in Goose Island on Feb. 18, 2023. Credit: Colin Boyle/Block Club Chicago

CHICAGO — Near the end of his recent Thalia Hall concert, Kristian Matsson, who performs as The Tallest Man on Earth, thanked his Chicago fans for supporting him ever since he first played at Schubas Tavern in 2009.

The Swedish singer-songwriter also gave a special shoutout to Thalia Hall, 1807 S. Allport St. He thanked the venue not just for hosting him, but also for not taking a cut from the sales of his band’s t-shirts and vinyl records set up at the merch table.

Matsson’s comments came as merch cuts — a longstanding policy where some venues require musicians and bands to pay them a percentage of their merch sales during a live show — are drawing new scrutiny across the country.

Earlier this month, punk musician Jeff Rosenstock derided the practice in a Twitter thread, and shared a spreadsheet of which venues on his upcoming tour required him to fork over part of his merch profits.

“This is going to cause us to sell our merch for higher prices than we’d like to at certain venues. We think that sucks,” Rosenstock wrote. “It makes no sense that at the end of these killer shows where we’re all having a nice time, someone who was our friend all night low key robs us and goes ‘have a safe trip to the next gig buddies!!'”

Merch on sale from Muna’s May 16 show at the Salt Shed. Credit: Provided/Brent Wolff

Rosenstock’s tweets went viral, and spawned numerous online conversations about merch cuts and how to possibly negotiate or avoid them while on tour.

Then last week, indie musician Tomberlin shared her experience online about being asked to pay 30 percent of t-shirt profits to a venue outside Washington, D.C., where the singer-songwriter opened for Ray LaMontagne.

Ultimately, Tomberlin decided not to sell merch at all that night.

“We are two people on a 6-week tour, chasing a bus each day and night, doing everything ourselves while above all else trying to treat others with respect and kindness and share music each night with you,” she wrote on Instagram. “I felt it was an extremely unfair rate and that altogether a merch cut is an archaic rule.”

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Merch cuts have existed for years at some venues, mostly at larger ones, bands and concert promoters tell Block Club. Some show operators argue it’s a reality of running their business, especially when they’re handling huge volumes of merch for bands playing to thousands of people.

But many musicians and bands, as well as owners of some of Chicago’s smaller venues, say merch cuts can border on predatory, especially as selling t-shirts and records at live shows are one of the few ways touring musicians can reliably make money.

“You know, artists take on all of the risks. We’re the ones traveling, we’re the ones trying to promote the shows, to get people to come to the shows, it’s kind of all on us,” said Nic Gohl, who sings and plays guitar in Chicago post-punk band Deeper. “You’d never see a band take a bar cut or anything like that, you know? So the idea of a venue trying to take a cut of the merch that you as a band bought and had to facilitate everything around … it just seems a little wild to me.”

Schubas Tavern. Credit: Serena Dai/DNAinfo

‘We Just Didn’t Feel Good About Doing That’

Block Club reached out to more than a dozen concert venues in Chicago to learn about how they approach merch cuts.

The vast majority of smaller venues, with capacities under 1,000 people, do not take a percentage of merch sales, operators said.

Robert Gomez owns Subterranean in Wicker Park, 2011 W. North Ave., and Beat Kitchen in Roscoe Village, 2100 W. Belmont Ave. Neither venue takes a merch cut, he said.

In his three decades running venues, Gomez said he has seen a dramatic shift in how bands make money — if they do at all.

Where musicians could once more reliably sell CDs and earn royalties, concert tickets and merch are now vital to making ends meet on the road, he said.

“There’s a lot more pressure on the tour. Margins are thin, so the one significant source of income for bands is their merch,” Gomez said. “So for us, we’ve never taken a cut of it, with that awareness.”

It’s an ethical decision venue owners can make, but it’s also an economic one, Gomez said.

Chicago is home to a slew of small venues with under-500 capacity rooms. If one started asking for merch cuts, bands could take their business elsewhere, he said.

“As much as we can say that we’re grandiose and all of that, the reality is we have to compete. And one thing that might give you a competitive edge over another venue is that you’re not taking that approach,” Gomez said.

(from left) Lillie West (Lala Lala), Nnamdi Ogbonnaya (NNAMDÏ), Abby Black, Sen Morimoto performing at Sleeping Village in January of 2020. Credit: Courtesy of Victoria Sanders

At Sleeping Village in Avondale, 3734 W. Belmont Ave., director of programming Alicia Maciel said the venue has never taken a cut of merch sales from performing artists.

“I respect and uphold that policy and I’m glad that that is our policy. And I believe the logic behind that is we’re not involved with production of said merch, so we wouldn’t take a cut from that,” Maciel said.

Lincoln Hall, 2424 N. Lincoln Ave. in Lincoln Park, and Schubas Tavern, 3159 N. Southport Ave. in Lakeview, don’t take cuts, either, employees said — but that’s a somewhat recent development, talent buyer Dan Apodaca said.

While he doesn’t believe Schubas has ever taken a percentage of merch sales, Lincoln Hall did until a few years ago, Apodaca said. He and his colleagues gradually decided to phase the policy out after he settled into his current position, which involves booking shows and programming at both venues, Apodaca said.

“Getting rid of the merch cut just made sense to all of us. It’s the kind of amount of money that is not devastating for us to not receive, but can be game-changing for an artist to keep,” Apodaca said. “We just didn’t feel good about doing that.”

Today, Lincoln Hall and Schubas, like Sleeping Village, offer an option for a touring band to pay a fee to hire a venue employee to sell merch during a show, but it’s not required, Apodaca said.

Thalia Hall in Pilsen on March 27, 2023.

Several musicians Block Club spoke with said they’ve rarely encountered merch cuts at smaller venues in Chicago and while touring across the country.

That includes Chicago-area musician Owen Ashworth, who records and tours under the moniker Advance Base.

“None of the small Chicago venues that I typically play (like Sleeping Village, Beat Kitchen, Schubas) ask for a cut of merch sales. That practice is more typical of larger rooms, the type that Live Nation has been gobbling up in recent years,” Ashworth wrote in an email to Block Club last week.

When Advance Base played larger venues about a decade ago opening for Death Cab For Cutie’s Ben Gibbard, Ashworth said Gibbard and his manager “made an admirable effort” to make sure he could keep the profits from his merch sales.

Still, when he has had to hand over a cut, “it has hurt” Ashworth said.

“Merch costs money to make & artists like me depend on t-shirt sales to put gas in the tank & food on the table,” Ashworth wrote. “Venues demanding cuts of merch sales are putting artists in the awkward position of either losing money or jacking up the prices of their merch and further punishing the fans who are already paying outrageous service fees on their tickets to attend these shows.”

The Salt Shed music venue., as seen from above Goose Island on Aug. 3, 2022. Credit: Colin Boyle/Block Club Chicago

Merch Cuts At Salt Shed Help Pay For Sales Staff, Director Says

Chicago-based hospitality company 16″ On Center is one of the city’s most successful venue operators. They run the Empty Bottle in Ukrainian Village, 1035 N. Western Ave., Thalia Hall in Pilsen and The Promontory in Hyde Park, 5311 S. Lake Park Ave., as well as multiple bars and restaurants.

Last year, the company started hosting shows at its expansive Salt Shed venue at the former Morton Salt warehouse near Goose Island, 1357 N. Elston Ave., first in its outdoor “Fairgrounds” space followed by its indoor counterpart in February.

16″ On Center director of music Brent Heyl said the company does not take merch cuts for shows booked at the Empty Bottle, Thalia Hall or any of its other small venues.

But when they opened the Salt Shed last year, Heyl said it did “change my perception” about merch cuts at large venues.

The venue now works with an outside company for Salt Shed shows to handle everything from merch intake to selling it at the actual concert. To fund that service, the Salt Shed takes a 10-percent cut of products sold, Heyl said.

“To put it in perspective, if we have a show coming, we’re very often receiving semi-trailers full of boxes of merch, and having a place to store that, track it, get it in, get it accounted for, get it out at the end of the night and get it back to the tour, it’s a whole thing,” Heyl said. “So we made a stance to only charge 10 percent, which at a national level is still coming in quite a bit lower than a lot of the other locations.”

Heyl said his experiences at the Salt Shed — as well as hiring the merch company to work offsite events like the recent Plantasia show at Garfield Park Conservatory — has shown him the system can actually help bands sell more merch.

“In taking a cut, we can keep the same staff employed at our venue or have consistent people that are coming in. They know our space. They know how to operate it. They’re bringing in their own [point of sale system], so it makes the process a lot smoother,” he said. “So there’s a very direct correlation between having experienced sellers that are used to doing a high amount of volume and the result that you get from that.”

Fans line up outside the Metro to get tickets for a surprise Metallica show in 2021. Credit: Jake Wittich/ Block Club Chicago

Other large venues on Chicago’s North Side did not return requests for comment last week.

That includes Metro, 3730 N. Clark St., in Wrigleyville as well as Jam Productions‘ The Riviera, 4746 N. Racine Ave. in Uptown, The Vic, 3145 N. Sheffield Ave. in Lakeview and Park West, 322 W. Armitage Ave. in Lincoln Park.

Live Nation, whose Chicago venues include the Aragon Ballroom, 1106 W. Lawrence Ave., and House of Blues, 329 N. Dearborn St., also did not return a request for comment.

Gomez, with Subterranean, said musicians tend to encounter merch cuts at bigger concert halls because there are fewer options for where they can play at that level, especially in Chicago.

“I think [venues] are doing it because they can. Venues that large, there’s less competition,” Gomez said. “Like 5,000 [indoor capacity], there’s only the Aragon. At some point, you don’t have to deal with that level of competition. … There’s less options at that size.”

Even for smaller indie musicians who don’t frequently encounter merch cuts, the stakes remain high, Ashworth and Gohl said.

“Independent musicians are as vulnerable as any self-employed person in a gig economy,” Ashworth wrote in an email. “Our power comes from our numbers & whatever small platforms we’re able to scrape together. It’s important to speak out when we experience unfair working conditions. We have to support each other.”

“Definitely, merch matters,” added Gohl with Deeper, which is currently touring the country in support of its new album.

Lincoln Hall, 2424 N. Lincoln Ave. Credit: Facebook/Lincoln Hall + Schubas

A Growing Movement

Last year, the Union of Musicians and Allied Workers and several other groups launched a campaign aimed at ending merch cuts at venues across the country.

The “#MyMerch” movement asks venues and festivals to commit to not take percentages of merch sales at their concerts and events.

Merch cuts are “an exploitative practice that interferes with one of the few ways fans can directly support artists in this challenging economic climate, and it must stop,” the campaign wrote on its website.

So far, more than 150 venues in the U.S. and Canada have signed on to the pledge, according to a public spreadsheet. Thalia Hall, the Empty Bottle, The Promontory and SPACE in Evanston are the only local venues on the list, so far.

In Chicago, the recent conversation about the practice is a necessary one, several operators told Block Club, shining a light on the challenges of both being in a touring band and running a venue.

“I hope that leads people to think and be more productive in the conversation of what expenses are, across the board for everyone, and what they could do to support artists and venues,” Maciel, of Sleeping Village, said. “To buy that ticket in advance, to buy that merch, it really does just go a long, long, long way for all of the people involved.”

Apodaca, with Schubas and Lincoln Hall, said the outcry over merch cuts highlights the importance of supporting independent venues in Chicago, which have the latitude to make the best decisions for their business and community.

“It’s really nice that we have autonomy,” he said. “We can decide what makes the most sense for our venues and the artists we’re working with and we don’t have to worry about some national corporate overlord saying like, ‘Nope, sorry, you have to do this.'”

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