DC Caribbean Carnival: Economic Impact Study 2011

Yuvay J. Meyers, Ph.D.

Debby Lindsey-Taliefero, Ph.D. Allison J. Morgan, Ph.D. Lynne J. Kelly, Ph.D.

Howard University School of Business

Roadmap
Background Study Overview Survey Results Patrons Survey Results Business Owners

Financial Analysis
Final Recommendations

Background
The DC Caribbean Carnival, Inc. was started to celebrate Caribbean culture in Washington

metropolitan area in 1993.

Flagship Event - DC CARNIVAL Extravaganza Parade and Festival
Approximate annual attendance - 400,000 people
Parade live performances and bands International Marketplace, DE SAVANNAH

Background
DC CARNIVAL is centered on Georgia Avenue in the District of Columbia.

The District benefits economically and culturally

from the celebration. The event also serves to strengthen community ties, promote social harmony, as well as foster multiculturalism.

Study Overview
DC Caribbean Carnival, Inc. charged the Howard University School of Business (HUSB) to quantify

the economic impact of the DC Caribbean Carnival.

Data collection was carried out on June 25, 2011

during the Carnival.

Information gathered from both Carnival patrons and business owners.

Study Overview Research Tasks

Three major tasks including:

A survey of event attendees focusing on the specific economic contribution to the District of Columbia. A survey of local small businesses focusing on the economic revenues earned during that event. An economic impact assessment, which involves an evaluation of the direct contribution of the carnival attendees on the District of Columbia.

Study Overview Research Tasks

The goal of the study was to provide the following: Estimate of the expenditures of the patrons attending the 2011 Annual DC

CARNIVAL.
Estimate of the incremental sales tax revenues generated by 2011 Annual DC CARNIVAL. Estimate of the business revenues generated by 2011 Annual DC CARNIVAL. Estimate of the incremental business tax generated by 2011 Annual DC CARNIVAL.

Study Overview Data Collection

Participants
685 patrons

50 business owners

Survey
Hard copy survey administration
No financial compensation Participants entered to win an Apple iPad

Survey Results

Key results summarized for patron survey and business owner survey.

Survey Results - Patrons

The majority of Carnival Patrons are local to Washington metropolitan area.

Survey Results - Patrons

The majority of Carnival Patrons attended the Carnival with family and/or friends.

Survey Results - Patrons

Many patron attended the Parade and Marketplace while at the Carnival.

Survey Results - Patrons

The anticipated spending for the Carnival was on average less than $50.

Survey Results - Patrons

Carnival Patrons reported being positive comments in terms of satisfaction with the Carnival more frequently.

Survey Results - Patrons

The most frequently mentioned method to improve satisfaction at the Carnival was to extend the Parade.

Survey Results - Patrons

The primary information sources for the Carnival were by Friends/Family and Word of Mouth.

Study Results Business Owners

Most of the business owners found an increase in customers during the Carnival.
During the DC Carnival, did your business receive any additional customers?

28.3%
Yes No

71.7%

Study Results Business Owners

Average customer expenditures during the Carnival was $50 or less.
On average how much did each customer spend during the DC Carnival?

More than $400 $301 to $400 above $400 $301 to $400 $201 to $300 $101 to $200

0.0%
0.0% 0.0% 0.0% 2.0% 2.0% 2.0% 2.0%

$10 or less $11 to $25 $26 to $50 $51 to $75 $76 to $100 $101 to $200 $201 to $300

$76 to $100
$51 to $75 $26 to $50 $11 to $25 $10 or less 0.0%

$301 to $400

20.4%
32.7% 38.8% 20.0% 40.0% 60.0%

above $400 $301 to $400 More than $400

Study Results Business Owners

The majority of Business owners felt the Carnival helped the Georgia Avenue corridor.
Do you think the DC Carnival help or hurt business on Georgia Avenue corridor?

8.2%

Help Hurt

91.8%

Study Results Business Owners

All business owners believed the Carnival should continue.
As a local business, do you think the DC Carnival should continue? 120.0% 100.0% 80.0%
Yes No

100.0%

60.0% 40.0% 20.0% 0.0% Yes 0.0% No

Study Results Business Owners

Average annual business income reported was typically $80,000 or less.
What is your business income?
$80,000 or greater $65,000 to $79,999 $50,000 to $64,999 $35,000 to $49,999 $20,00 to $34,999 Less than $20,000 0.0% 10.0% 9.3% 18.6% 20.0% 30.0% 14.0%

18.6% 20.9% 18.6%

Less than $20,000 $20,00 to $34,999 $35,000 to $49,999 $50,000 to $64,999 $65,000 to $79,999 $80,000 or greater

Study Results Business Owners

Satisfaction with Carnival activities was typically positive from business owners.
Please tell how satisfied you were with 2011 DC Carnival? 8 Total Event 1 2 3 5 Completely satisfied 10 Marketplace 0 1 5 3 8 Parade 0 0 2 2 5 8 18 13 Mostly satisfied Somewhat satisfied Neither satisfied or dissatisfied Somewhat dissatisfied Mostly dissatisfied 16

Completely dissatisfied

10

15

20

Financial Analysis
Includes the following analyses:
Cost Benefit Analysis

Estimated Patron Expenditures

Generated Sales Tax Revenues

Financial Analysis - Assumptions

Washington DC government provides $30,422 in support to the Carnival.

The Carnival Board is required to pay $338,700 in fees

to the Metropolitan Police Department for enforcement. The total event cost is $584,483. Comparisons made with Scotiabank Caribana. the Toronto Carnival,

Cost Benefit Analysis

The DC CARNIVAL makes $39.48 for each dollar spent and produces approximate sales tax revenues from the attendees of $1,298,230.00.
DC Caribbean Carnival 2011 Budget* Number of Attendees Attendee Expenditure Cost-Benefit Ratio***(Expenditure/Budget) SalesTaxes Earned $584,483 400,000 $ 21,637,166 $37.02 $1,298,230 Toronto Scotiabank Caribana 1998 $416,250 1,200,000 $198,000,000 $475.68 $25,740,000.00

Carnival Estimated Patron Total Expenditure and Generated Sales Taxes by Number of Attendees

The Caribbean Carnival provides increasing returns scale to the Washington, DC economy on a whole.
Number of Attendees Number of Patrons by Category Family and Friends Group Individual Total Patrons Average Household Size, DC 111,839 72,836 80,000 264,675 2.21 83,879 54,627 60,000 198,506 2.21 55,919 36,418 40,000 132,337 2.21 400,000 300,000 200,000

Average Expenditure
Total Expenditures Cost- Benefit Ratio Sales Taxes Generated @ 6% Tax Rate

81.75

81.75

81.75

$ 21,637,166 $ 37.02

$ 16,227,875 $ $ 27.76 973,672

$ 10,818,583 $ $ 18.51 649,115

$ 1,298,230

Estimated Incremental Revenues by Number of Attendees

The estimated incremental revenue per business was $751.52. Depending on the number of business along the DC Caribbean Carnival parade route or at the marketplace, the incremental revenues range from $75,152 (n=100 businesses) to $300,608 (n=400 businesses).
Consumer's Average Expenditure Per Business Average Additional Customers $ 26.84 28

Estimated Incremental Revenues Per Business

Number of Business

$ 751.52
100 200 300 400

Total Estimated Incremental Revenues along DC Caribbean Carnival Parade Route

$ 75,152

$ 150,304

$ 225,456

$ 300,608

Final Recommendations
The DC Caribbean Carnival provides significant economic value to the Washington, DC economy. Additional key recommendations are

highlighted:

Final Recommendations
1. To encourage the expansion of the Carnival, advertising of the event earlier and using larger

outlets may help to yield a wider attendee base.

2. The DC Carnival is a family event. Therefore,

materials promoting the Carnival as well as activities chosen to supplement the Carnival should bear this in mind.

Final Recommendations
3. This is an opportunity for corporate sponsorship. Corporations with a local presence should be made aware of the opportunities available to sponsor the DC Carnival and support this cultural event in the District. 4. Attendees are spending the majority of their money on food and beverage items. Getting additional vendors to

participate in sales of these items may be able to encourage

additional individuals to attend the Carnival.

Final Recommendations
5. The age group of Carnival participants is on average between 18 and 45. The Carnival might be

attractive to individuals in other age brackets if

there were designated places to sit. 6. The carnival committee should continue to ensure that the event remains an affordable friendly event. family

Final Recommendations
7. Extending the parade route could be of great benefit to attendees and businesses.

8. Some participants felt that law enforcement was

too aggressive to attendees. Possibly utilizing a civilian security detail could minimize part of this problem. Or working with the city and the police force on cultural sensitivity may be necessary.

Final Recommendations
9. Viral marketing campaigns should be a key method of event advertising moving forward. 10. Working with the local businesses before the event is essential.

HUSB Research Team & Contact Information

Yuvay Meyers, Assistant Professor ymeyers@howard.edu 202-806-1553 (w)

Debby Lindsey-Taliefero, Associate Professor dlindsey@howard.edu 202-806-1568 (w)

Allison Morgan, Assistant Professor aj_morgan@howard.edu 202-806-1605 (w) Lynne Kelly, Assistant Professor ljkelly@howard.edu 202-806-1658 (w)