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How the inflation impact on the Michigan events industry is costing you

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Posted at 10:16 AM, Jan 24, 2023
and last updated 2023-01-25 04:26:14-05

(WXYZ) — Inflation is the reason behind rising prices for many things. We've tackled stories covering many topics from fluctuating gas rates to increasing egg prices.

But the events industry has been challenged, too, and it all trickles down to your wallet.

David Crawford loves taking his wife and two young kids out to festivals.

Royal Oak's Taco Fest is one of them. But recently he has noticed how food prices at events have gone up. And those increases can add up.

"Well, who eats one taco?! You know what I mean, you got three going and then you say, 'I got three more in the tank,'" said David.

Food and beverage prices are a small part of the equation. Seasoned events producer Jon Witz says since 2020, planning any kind of event is an uphill battle.

"They have been a definite challenge on a lot of fronts and to say that inflation has hit the special event industry would be an understatement," said Jon.

Jon produces over 15 events across Metro Detroit, including the three famous Royal Oak ones, Winter Blast, Taco Fest, and Arts Beats and Eats. Jon says this year, all the budgets are up.

"Cost of tents, cost of music, cost of labor. We just had a jump in the cost of a bag of ice of 33%," he said.

Jon tells 7 Action News for Arts, Beats, and Eats in 2019, the budget was $2 million, and this year it's set at $2.8 million.

"We did Rock 'n' Rides last year, and that's possible that could be a 2023 causality of cost," he said.

In Dearborn, 10 days ago, entrepreneur Hassan Chami announced the cancellation of this year's Ramadan Suhoor Festival due to rising costs before reversing the decision due to public demand.

"Ramadan goes back 10 days a year because of the lunar calendar. This year it's going to be at the end of March, and because of the weather, I have to build out a heated tent, and it's going to be about 50,000 square feet, and the cost is outrageous," said Hassan.

Hassan is off-setting the cost for a heating tent and labor rates by adding a cover charge, which the public polled on social media, showing majority would pay more to enter.

"$5 a person, if you are coming as a family, it's $10 max," he said.

Hassan tells 7 Action News last year 15,000 to 20,000 people showed up per night. Back then the budget was $225,000, and this year the event cost is estimated to hit $400,000.

"You are not talking rides, you are not talking entertainment, where you have bands, you are literally talking tents, heater, generator, fencing, vendors, and lighting," he said.

Hanky Panky Donuts is one of the vendors at the Ramadan Suhoor Festival. The founder Haitham Jawad says this year, he is looking at high vendor fees along with rising prices of donuts mix, milk, sugar, and eggs.

"This year I will make slightly less money. That's fine with me. I'll be honest it's not about money, we are trying to do good out there, and it's a big charity as well," said Haitham.

"So last year, we donated, over $200,000 to The Amity Foundation. We gave out 12 scholarships, and we sent over 10 people to pilgrimage," said Hassan.

Back in Royal Oak, Jon says a charity aspect to events is a good way to create value for the community and helps with sponsorship but moving forward, partnerships with public entities is important.

"The Downtown Development Authority has invested in events, and the city has invested to a lesser extent in events, but the most important thing is you have to create value for those communities in which you operate. So you got to make an impact on local businesses, quality of life for residents," said Jon.

Meanwhile, David will try his best to hang out with his family at events.

"It's an adjustment, try to plan accordingly as best as possible and make it happen," said David.

Moving forward, for events to be successful more than ever, they need the community's support and involvement. In Royal Oak, Winter Blast kicks off next month. In Dearborn, the Suhoor Festival is in March.