how does a touring band book a nationwide tour?

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I understand on a high level that there is a tour manager, band manager, local promoters, and venues. But how do they all come together to make a nationwide tour happen for a band?

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That depends on many factors, and different bands can do it differently, size of the band also affects it. But a basic example of how it might go is:

The band contracts the tour manager. The tour manager already has contact with a bunch of local promoters in different states/countries; he will then try and sell the band’s concert to those promoters, and he’ll try and spread it in a way that makes sense (so if the tour starts in the band’s home city, for example, he’ll try and get the next few concerts in nearby cities/states – work out the logistics). Local promoters who contracted the band (through the tour manager) will then organize the event, booking a date at the venue (or they might own a venue, which makes it easier).

The bigger the band, the easier it is to sell the concerts to local promoters. Big enough bands get to a point where the tour manager basically goes “ok so I have those dates open” and many promoters will try to buy the date. The best dates tend to be more expensive (saturdays are better than, say, a wednesday, for example, and other factors besides the day of the week, like if a way bigger band of the same genre is going to play on Saturday in the same city, you might prefer to go for Sunday), and there’s still working out the logistics for travelling from place to place and such.

Some managers might eventually get a few routes down and build rapport with the local promoters, so the whole process gets very “automated” if you will, and he’ll just adjust details on the route (say, normally the third or so concert would be in X city, but the promoter won’t be available for whatever reason; the manager might either try another promoter in the same city or just replace that city with somewhere else).

Sometimes bands get specifically invited by some local promoter for a specific concert or festival, and then they might try and build a tour around it, too. And of course, some bands book their own tours instead of relying on managers. It’s kind of the same process, just more work for the actual band (and hard to do if the band doesn’t already have the know-how and the contacts).