Edinburgh’s festival season: record demand, rising costs

By Ben Sutherland, Partner, MHA, Edinburgh

As another festival season closes, it’s worth taking stock of what August actually means for Edinburgh’s economy – and the structural issues the city still needs to solve.

The scale of it never stops being remarkable.

With the Edinburgh Festival Fringe Society confirming 2.8 million tickets issued across 4,232 shows this summer, an 8% rise on 2025 and the highest attendance since 2019, headline demand remains undeniably strong, even as underlying operational pressures mount.

Across all Edinburgh summer festivals, the most recent independent assessment estimated the combined economic contribution at £492 million, sustaining more than 7,000 full-time equivalent jobs. Combined with the wider tourism economy, worth £2.7 billion in annual visitor spend and over 30,000 jobs, August remains unarguably the single most vital trading period for the capital’s business community.

Yet on top of the Fringe, Tattoo, International and Book festivals, this summer again saw major stadium concerts and outdoor gigs stacked directly onto the city centre calendar, alongside a run of European football at Tynecastle and Easter Road.

While major events bring an undisputed spending surge, this concentration has intensified warnings over the city’s capacity to absorb it all.

That pressure is increasingly the story behind the numbers. One of the Fringe’s largest venue operators has been blunt about it, warning that rising costs across the city, from accommodation to licensing to staffing, now represent the single biggest threat to the festival’s sustainability. It’s a warning worth taking seriously from an operator running venues at the sharp end of that cost pressure.

That pressure had a concrete consequence this summer. The Edinburgh TV Festival, an August fixture for fifty years, held its final Scottish edition before relocating to Greater Manchester from 2027. Organisers cited the need to reduce costs for delegates and widen access to the festival, pointing to the difficulty and expense of travel and accommodation when the event clashes with the Fringe. Scotland’s screen sector is already responding, with Screen Scotland and the Scottish Government working with the Fringe Society on a replacement content festival integrated with the existing August line-up.

Visitor levy

Adding to the commercial pressure, Edinburgh became the first UK city to implement a visitor levy this summer, a 5% charge on overnight stays that took effect on 24 July, just two weeks before the festivals opened. While projected to raise up to £50 million annually for infrastructure and the arts, its timing required accommodation providers to absorb new compliance and reporting duties precisely when hotel occupancy was running at 95% of peak capacity.

For local business, the operational reality is clear: festival season is immensely valuable, but navigating it well requires forward planning. Capturing the upside without succumbing to the strain demands careful cash flow modelling built around a concentrated trading window, getting temporary staffing and payroll right for short, intense bursts, and integrating new statutory duties like the levy well ahead of time rather than dealing with them on the fly.

Edinburgh’s festivals and events remain the city’s premier economic engine, but the businesses that get the most out of that each year are the ones that manage the pressure as deliberately as they pursue the opportunity.

Translating an August revenue spike into sustainable year-round stability takes proactive financial discipline, from managing cash flow after peak trading to structuring tax and VAT efficiently around seasonal expansion.

As the capital draws a quick breath, the focus for business leadership now turns from surviving the peak to building long-term financial resilience.

Edinburgh-based Ben Sutherland, a Partner at MHA, specialises in key sectors including food & drink. MHA is the independent UK member firm of Baker Tilly International.

For further information, visit www.mha.co.uk