Fri June 27, 2014
What Is The Economic Impact Of Street Fairs? WYSO Curious Hits The Pavement
Strawberries, sauerkraut, asparagus, popcorn, beans, bacon and moonshine—aside from usually being edible, what do they all have in common?
They’re all themes for street festivals in Ohio—like the Popcorn Festival in Beavercreek, or the Ohio Sauerkraut Festival in Waynesville. There’s one just about every weekend right now, and they were the subject of a recent question from WYSO listener and Yellow Springs resident Roger Reynolds submitted for WYSO Curious.
What is the economic impact of a local small town festival or street fair, and is it worth the trouble to put those kind of festivals on?
Many music festivals and church and school fundraisers are held in parks or on private land, but most of the larger local festivals have taken to the streets. For an apples-to-apples comparison, we decided to focus on local events that shut down part or all of a city block for a festival or fair at least once a year.
Organizers not tracking impact
Yellow Springs packs its downtown with a bustling street fair twice a year—it’s a fundraiser for the village Chamber of Commerce, a non-profit that supports economic development in the village. At Emporium Wines and Underdog Cafe downtown, the first person WYSO talks to says she can’t stand it.
“Twenty-five thousand people take over our town, the chamber makes all this money,” says Kathleen MacMillan. “It’s hard.”
Like a lot of townies, she avoids the whole thing—and, she suspects it’s not great for everyone. “Only a few local people make a lot of money from it,” she says.
But the owner of this shop, Kurt Miyazaki, says he’s definitely one of those local people.
“When people say they don’t like the street fair because it’s so crowded, locals need to understand that that actually helps us keep prices down for them,” he says. The Emporium and nearby Dino’s Cappuccinos can double their sales on a street fair day.
“It’s a good day for us,” says Dean Pallotta, a.k.a. Dino. Dino’s occupies the sidewalk in front of the store during street fairs to sell snacks and cold drinks.
The chamber brings in about $130,000 a year directly from the summer and fall street fairs—the vendor fees, sponsorships and drink sales. That’s about double what it spends.
Most of that revenue comes from vendor fees. Out-of-town vendors pay $200 for a booth, and locals pay $100; non-profits get a discount off of that. About 20 percent of revenue comes from sponsoring organizations, and another 20 percent from direct sales. About 20 non-profits, including WYSO which is also a media sponsor for Street Fair, have booths, and a handful of local companies do great business for the day, primarily selling food and drinks.
But the chamber doesn’t have a record of the overall economic impact for the town or Greene County.
“We know we’re getting a lot of visitors, and that economic impact I honestly don’t know,” says Karen Wintrow, who heads the Yellow Springs Chamber of Commerce.
Turns out there are some obstacles to actually quantifying economic impact beyond direct revenues: for example, it’s hard to get so much as a head count in an open street fair. And some companies, especially food and hotels, report great sales, but others say event days are a bummer. The Yellow Springs Chamber of Commerce surveys businesses about their experiences after fairs, but they’re not required to track revenues or profits. The problem isn’t unique to Yellow Springs: WYSO contacted half a dozen local festival organizers and the state tourism bureau, and found none of them had crunched the numbers.
Experts: Organizers should study impact
“I definitely recommend doing some sort of tracking of visitor spending,” says Rachael Carter, a tourism expert with Mississippi State University Extension Service. She says not every town needs to do a formal economic impact study, but it can help with planning. “For example they may be spending a lot of money on food and beverages but they might not be spending very much in your retail shops, so maybe that would give you a clue that maybe we need to work with our retail merchants and figure out a way that they can make money off of this event.”
Most of the studies she’s worked on have found the benefits outweigh the costs, and she says the reason to work with a specialist to assess economic impact is usually that someone in the community has doubts about whether the festival is living up to its promise.
Short of hiring an expert or paying for a special tool to calculate economic impact, there is an elementary way to measure: TourismOhio, the state’s tourism bureau, estimates a day traveler in Ohio spends $110 dollars a day (based on a study by Longwoods International and Tourism Economics; overnight visitors are estimated to spend $335). So, for a day-long event, you could multiply the number of visitors by those dollars. By that count the Yellow Springs Street Fair, estimated at 25,000 visitors, brings in $2,750,000.
But another tourism expert, Dave Marcoullier at the University of Wisconsin, cautions against a simple spending count—partly because many vendors actually come from out of town.
“The total amount of spending that takes place at these festivals and events, only a portion of that stays local,” says Marcoullier.
Plus, there are locals who stay home to avoid the crowds and don’t shop like they normally would. And visitor spending is likely to differ based on what the location has to offer, so towns should ideally come up with their own estimates.
Finally, TourismOhio’s numbers are focused on visitors from out of state. The agency estimates 195 million people visited Ohio in 2013, with 37 million overnight visits and direct visitor spending of about $30 billion. TourismOhio doesn’t provide estimates for visits within the state from other Ohio residents.
Benefits for non-profits
Many local events and festivals are focused on supporting non-profit organizations, as opposed to sheer economic impact. The Ohio Sauerkraut Festival in Waynesville and the Troy Strawberry Festival only allow food vendors whose revenues go to regional non-profits. In Waynesville, 65 non-profit food booths each year flank more than 400 vendors selling hand-made crafts only. In Troy, 70 food vendors raise an estimated $400,000 in revenue at each festival, which is generally split between the non-profits and local restaurants who provide the food. The organizations who attend pay a fee for a booth plus a 15 percent cost share with the festival.
In Yellow Springs, local non-profits get vendor booths at a discounted rate. Chamber of Commerce director Karen Wintrow estimates the Yellow Springs Kids Playhouse raised $1,190 parking cars this June, and the National Alliance on Mental Illness raise $500 at a table. The Mills Lawn PTO also fundraises by parking cars, and the Cub Scouts sell water.
Estimated attendance and revenue from four Miami Valley events, based on organizer estimates. Left blank where no numbers were available:
One of the reasons to evaluate the economics of a public fair or festival is that often cities and towns put taxpayer resources into the event. Both the Waynesville and Troy festivals have formalized relationships with the city to cover costs associated with shutting down streets and keeping them clean.
Troy’s police and city street departments take care of most of the security and many of the logistics—electricity, street banners, cones and barricades, patrolling parking and shuttle areas and more. Strawberry Festival business manager Heather Dorsten estimates the city gives $56,000 worth of staff time to the festival, so the city is considered a platinum sponsor of the event. The festival has recently moved into town from an off-street location on the levy. As a result of the move, Troy estimated another $20,000 of staffing costs to be covered by the festival this year.
Dorsten says the primarily goal of the Strawberry Festival is to support non-profits. The cost of the Troy Strawberry Festival is typically around $100,000, with about 75 percent of the revenue coming from sponsorships. On years when the festival’s income exceeds its spending, that cash goes into a rainy-day fund to make up for losses in future years.
The village of Yellow Springs collaborates with the fair on security and some logistical needs at no cost to the YS Chamber of Commerce; the fair doesn’t have an estimate of the in-kind cost to the government.
“The expense of what it takes to put this festival on is unbelievable,” says Barb Lindsay, the event coordinator for the Waynesville Chamber of Commerce. The Ohio Sauerkraut Festival temporarily leases a part of downtown from the city during the three days of the festival, and the festival pays for policing, security and cleanup out of revenue from sponsorships and vendor fees.
Lindsay says it’s all worth it.
“A lot of people have lost jobs. They’ve turned to making crafts to try to keep their families going,” she says. “It keeps our non-profits going. We’re a small area here in Waynesville, we don’t have industry here...our wonderful community has got to rely on things to keep itself going.”
Promotion in struggling downtowns
Lots of organizers say the biggest benefits can’t be measured in lemonade or beer sales—festivals are a way to promote the town itself. As Ohio cities and towns have lost key industrial employers, many have turned to tourism and services as an economic driver. For several decades now, the overall U.S. economy has been shifting from a manufacturing-driven economy towards a service economy. In many towns, that means returning to historic downtowns for redevelopment.
Troy’s Strawberry Festival is such a big deal they have strawberry decals painted on the streets year-round. At Around About books, a roomy, old fashioned new and used bookstore, owner Sue Cantrell says she used to lose business on the day of Strawberry Fest when it was a few blocks away on the levy.
“When it is downtown here it does wonderful,” she says. “We really get a large number of people in, and it turns out people didn’t even know we were down here!”
Getting people down here means free publicity for businesses like Cantrell’s.
“Anything downtown is advantageous,” says Liz Stafford, who runs a sports apparel store, Stafford Uniquely Sports, just off the town square. “Anything.”
Stafford adds that the Strawberry Festival isn’t a big event for her. She doesn’t have the cash on hand to risk stocking strawberry-themed products for just a weekend-long event, and most attendees just aren’t looking for team-branded apparel while they’re out at Strawberry Fest. But she agrees with festival organizers and neighboring businesses that the overall publicity for downtown can’t hurt.
“It’s always the hope that when people come downtown, they have a great experience, and then they’ll go back and say, actually you know, if you haven’t been there for awhile, it’s actually pretty great,” says Val Beerbower with the Downtown Dayton Partnership, which puts on Urban Nights, a downtown street festival, twice a year.
Urban Nights has been a key event in downtown Dayton’s attempts to attract visitors to a slowly rebuilding downtown. Despite a continuing high downtown vacancy rate and relatively low foot traffic outside the Oregon District, Beerbower thinks efforts to revitalize downtown will ultimately bring development back into the city center and surrounding areas. There’s already increased demand for housing downtown, she says—the rest is a matter of time.
“Developing your urban core is really the driver that will push that additional economic development out to the outlying areas,” says Beerbower. “This downtown roller coaster is really cresting up over its hill, and I know because I’m in the front, I can see what’s ahead. I’m kind of looking back at everyone else at the back of the car, and they’re about to be in for an awesome ride...good things are coming.”
“It’s not about the money”
Now we return to Roger’s question: is all the cost and trouble that goes into a street fair or festival worth it? Fundamentally, each place has to evaluate that based on its own values, resources and the estimated benefits. But usually street fairs start as small community events—they grow because people have fun.
Joseph Glenn is a steel drum player and a recognizable regular on the Yellow Springs street musician circuit. At the packed summer street fair June 14, he says he’s there mainly for fun. He won’t say how much money he makes on a street fair day. He just wants to show people “what we have going on here in Yellow Springs, and give the people a taste of what’s happening on a regular basis...It’s not about the money, you know?”
CORRECTION: A previous version of this story misnamed Roger Reynolds as Roger Penrose.
WYSO Curious is our growing, changing series driven by your questions and curiosities about the Miami Valley. Is there something you’ve always wondered about the Miami Valley’s history, people, culture, economy, politics, or environment? Send in a question now, and check back to see which questions we’re considering.
Lewis Wallace is WYSO's economics reporter and substitute morning host. Follow him @lewispants.
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