Broadway Production Costs versus Tour Cost.

Interested in both the weekly nut and the development costs?

I mean to get a show to Broadway is expensive, with one off costs such as readings, workshops, try outs, further development costs, advertising, previews and press night and hopefully the Tony Awards.

So I can understand Broadway will be expensive, as if the show doesn't look good, it won't make it on tour.

Without getting into budgeting specifics ---

A tour can be more economically viable because there is a GUARANTEE: the production negotiates with the presenter to receive $X in order to play that city. For any revenue beyond that there's a box office split. So because of guarantees, the show begins rehearsals for the tour knowing that at a bare minimum it will gross a certain amount of money over the contracted period of the tour. As opposed to a Broadway show, where all revenue goes to the show entity minus X% to the theatre owner and nothing is guaranteed.

A tour is capitalized as its own entity usually, but that entity pays a royalty back to the originating production. So let's say you have a show that runs on Broadway for 1.5 years but only returns 60% to its investors. It could tour for a year+ with an Equity company, then flip to non-Eq for another year and play smaller markets. Maybe it also does a production on the West End. Australia/Europe/Asia might follow. Then it gets licensed to regional & amateur theatres. All those subsequent productions pay a royalty back to the Broadway entity, so the Broadway investors can probably be made whole and then some by those productions. (The Broadway investors/co-producers are also usually given the opportunity to reinvest a pro rata share into subsequent touring or international productions)

That's all a best case scenario. If a show is esoteric -- like A Strange Loop or a play -- or makes $0 on Broadway, then the road to profitability is much, much tougher. A big populist musical on Broadway could be viewed as a very expensive Proof Of Concept for future life, even though producers very much want to earn as much money as possible on Bway.

Updated On: 11/24/23 at 11:07 AM

In the absence of more context, here are a few things that I think might help your quandary:

There has never been more ways to take a tour out than today... and the economics are generally tied to what Equity contract you're using.


• Starting at the most expensive: A first-class, Production contract, first national tour. This is generally as close to a replica of the Broadway production as you can humanly get. It's the same "production" as the Broadway, meaning it's the same vision and generally design. It's generally a derivative company, managed by the same producers/GM, and capitalized (on a hit), by the Broadway production's investors who are allowed their pro-rata share of the tour investment as their investment in the Broadway. The set and performer tracks may be slightly modified to make a show more tourable, but the performers are on the same Equity contract as the Broadway production (but, like Wicked, may be a slightly lower salary). Breaking the Broadway production into three categories: company fixed expenses, theater expenses, and marketing, this level of tour would have higher company fixed expenses as the performers get their salary and per diem, more of the technical staff is part of the company fixed expenses, and the show has load-in, load-out, and hauling expenses. The theater expenses would be much lower, if not non-existent, for the tour company as the show specific tech staff are now part of the company expenses, but the house staff (ushers, house minimum tech staff, box office, etc) would be the burden of the local presenter. There are some marketing expenses a tour would have, but by and large these are a fraction of the Broadway company, as the Broadway company is both producer and presenter. This type of tour may not necessarily lay-off during the summer if the show is a big hit. Yes, each local generally pays a "guarantee" and any box officer "overage" is split between the local presenter and the producer, but I think what we're seeing is that the road has consolidated so much that tours have to think about guarantees across across an entire season itinerary more than just weekly. This tour would pay the creators royalties and fees that were negotiated as part of their initial contracts directly and then the original production a fee and royalty for the expenses you mentioned that it incurred: developed, initial advertising/ marketing assets, etc. For a show to go out on a production contract it would generally have its own physical production (costumes and sets), because the Broadway production would have had to have been a hit... and would presumably still be running.


• The next expensive would be one of the Equity tour agreements. There are three and they scale salaries and terms based on an escalating weekly average of a tour's guarantee: the lower tier is right about an average guarantee of 350k/week and the top is just under 400k/week (vast simplification). This could be a second year of a production contract tour, the first year of a Broadway show that wasn't necessarily a hit and didn't have a first-national, or a wholly new production of a show just built to tour. Aladdin is a tier contract tour now and I think The Wiz is as well. You'll start to see more layoffs on this type of tour than a production contract tour and it perhaps may not have any summer bookings either (which means it'll also have remounting -- casting, creative, and rehearsal costs every year.) You'll also see hard set pieces swapped out for more drops (a la the current Aladdin tour) and perhaps adjustments to the orchestra and ensemble as well. Sometimes a tier tour would be produced by the Broadway producers sometimes they license it to one of the road companies who may capitalize the show themselves -- or in some hybrid arrangement.

• The last of the Equity tours and the cheapest is a SETA contract tour. There are a couple of tiers of this as well. I wanna say three (?). The current Les Mis is a SETA contract tour. These tours probably have a weekly operating budget that is around / slightly above 200k/week (VAST generalization), which is what we're seeing is the new weekly ad budget target for the new Broadway shows. It may or may not have any connection to the most recent Broadway production of a show and would most likely rent a set / costumes or use a previous years.

• Then you have the non-equity tours which may have no connection to the most recent Broadway production, be a tour of a show that wasn't a hit at all, or is just a production built to tour. These productions generally run season to season and have to be remounted every fall. The Tootsie tour and the current My Fair Lady tour both are season to season and need to bring in a creative team every fall to remount the production on the previous year's physical production. Those are "Replicas" of the Broadway productions but the "Little Women" going out is probably assembled from whatever is rentable.

Other terms you may encounter would be:
• split week: a tour that plays two cities in a week,
• single-nighter: yep, a LOT of time on a bus.

I can't think of an Equity single-nighter: maybe only Menopause The Musical. The tier contracts/SETA (by nature of its name) would generally all have some split weeks (think like half of the week in Santa Barbara and half of the week in Thousand Oaks).

As you can see there really is no standardized way to get a tour out anymore and your local subscription would most likely have some of each (in most cities). Even the MASSIVE Pantages where shows can gross more than a million a week will have some of each on its season.) A show that might have multiple companies out (produced by the Broadway producers) may be structured several different ways. A sit down may have a fixed point of origin and not be a touring company at all, while a tour moves week to week or every couple of weeks.

Does the answer to your question lie somewhere in there?

So, First Class and Second National Tour wouldn't necessarily be the same kind of thing.

First class is a rights delineation of the authors. First class rights very generally means professional. Second class very generally means stock and amateur. Some of the tours that are out (On Your Feet) were arranged by the show's stock and amateur rights agency but, despite also being non-Equity, I'd still think it's generally considered a first class production because it's playing performing arts centers. It's not a replica of the Broadway production, so it wouldn't be considered in the sequential order of the Broadway production tours. Very generally, anything you'd see on a subscription would be hard pressed to call second class. This is a VERY old/hair splitting way of classifying tours and if you ask four people you'd probably get five different opinions on the current On Your Feet tour.

Second National Tour is quite literally the second company to tour. In the old days, the first national played longer runs/sit downs and the second national toured A-/B markets on a weekly basis. Anecdotally, I seem to remember that the second national often outran the first national because by nature it's meant to move faster/cheaper. The first national of Phantom lasted longer than the second though. But the third outran them all. Tracking all of this, it becomes clear why. But that kind of business has largely all been shattered. "First nationals" going out non-Equity is a relatively (and sad) new thing and several have in the last decade.

You can generally find the Equity status of a tour by running "show name +audition" through Google. The audition listings have to list the contracts.

Just as a note:
• Six is an outlier because the North American rights were licensed separately from the British producers. Thinking back, I even think the cruise ships had a production of Six before the Broadway/ NA tours. Because we generally refer to the companies by character names (or a derivative of the LLC name if it's not a character), this idea really comes down to whether you consider non-Equity tours professional. Sadly, subscriptions market them the same way so the audience generally has no idea and in some cases non-Equity tour contracts have better salaries than an Equity tour. So....
• Some years Chicago goes out Equity, some years it goes out non-Equity, but so far all the NA tours have been replicas of the Broadway production, so even the non-Equity tours would probably still be considered First class.
• The road is a hard / evolving business. I suspect that some of the shows that you list that have announced tours (or will) may ultimately end up going out non-Equity (even the First national). I seriously hope that I'm wrong, but the road is so consolidated and getting a title to cut through is so hard that it gets hard to justify expensive tours for shows that aren't slam dunk hits.

Thank you for the replies.

With the Phantom because of the success was a major contributing factor, with so many productions running this enabled costs to be kept lower, say costumes one place could make costumes for multiple productions. Also the show could be under cast thus keeping the wage bill lower.

Well this is all very confusing and is more confusing than when I started.

I am going to use the megahit Hamilton as an example as it is recent and had 3 tours.

So the first tour was Angelica that started 03/10/2017 at San Francisco and concluded 08/25/2023 in Puerto Rico.

The Phillip Tour that started in Seattle on 02/06/2018 and is ongoing.

The Peggy Tour started at 01/08/2017 at Puerto Rico and concluded in Toronto 08/20/2023

Would it be fair to say that all 3 tours were on first class contracts? The staging for all 3 tours were very similar in scale?

It also had a successful sit down in Chicago 10/19/2016 to 01/05/2020 at the CIBC Theatre.

Normally the Chicago sit down would form a second US tour? But this just seemed to of closed, maybe that set got used in Australia?

I was very surprised that 2 Hamilton tours concluded at the same time, I guess the Angelica set has gone over for the UK tour and maybe the Peggy set is going to be used for the international tour?

Thanks again all very interesting.

I have been looking at the non-equity tour of Come From Away, this is playing a host of one night shows across America in very small towns, that wouldn’t be profitable for the original first class tour. So I guess this is called the bus and truck tour and key to making this tour sustainable is done on a cheap shoestring. So guess production values will be at the poorer end.

This tour also will be going into the Pantanges Theatre, Los Angeles & Boston Opera House, so wouldn’t this show look dreadful in such a big theatre and people going for a return visit will really notice the difference? Or do the producers hire in the original first class set?