Oktoberfest in Munich, Germany, is one of the world’s most significant traditional festivals, gathering around 7 million locals and visitors annually. The city’s Department of Labour and Economic Affairs (RAW) organizes this massive event, generating an estimated €1.2 billion annually, making up 2% of Munich’s GDP. Despite the rising inflation, the positive economic impact of Oktoberfest on the country is worth appreciating.
Oktoberfest- Global Economic Perspective
Oktoberfest Munich lessens the country’s huge economic burden, bringing massive tourism, providing thousands of jobs, and the visitors spending about 435 million directly.
Being a Global Traditional German Festival, the Munich beer festival attracts foreign tourists to Munich and offshoots to various regions of the world including the USA, Canada, and other European countries. And it has a huge positive impact on their economic burden, promoting cultural norms and traditions.
The University of Wisconsin-Whitewater reported through a survey that Oktoberfest in La Crosse alone generated $26 million in economic stimulus, up $10 million from 2014. The festival benefits local businesses, donates over $43,000 to local groups, and awards scholarships to high school seniors and pageant winners.
Oktoberfest Revenue Streams and Earnings
The Bavarian beer festival has been hosted for over 180 years by the Munich Department of Labour and Economics Development and Munich City Council’s Economic Affairs Committee, which hosts more than 6.5 million visitors worldwide. Although the attendance percentage dropped to 5.7 million in 2022, post-pandemic, the festival witnessed a groundbreaking beer consumption of nearly 5.6 million liters.
The festival earns nearly €140 million from tents, bars, sales stands, and other festivities during the 17 days of the event. Munich, the organizer, gets 7.8% of the turnover rent. According to market researcher Zednik, Oktoberfest generates an estimated €160 million in trade, especially from Dirndl and Lederhosen sale.
Hotel Accommodation Turnout
The cultural German Oktoberfest hosts almost 30% of the total attendees from outside Munich, including 13% from the rest of Bavaria and 14% from abroad. More than 65% of the total population from outside Munich takes accommodation in one of the 450 total hotels within the city. Out of the total economic value of €1 billion, €350 million is spent on accommodation, bringing enormous value to tourism and the county’s economy.
The Beer Festival generates nearly 13,000 jobs yearly for taxi drivers, hotel staff, waiters, barmaids, workers, security, etc., with a total of nearly €319 million spent directly on the country, as quoted from a research article published on Medium.
Large and Small Oktoberfest Beer Tents
The Bavarian festival has a satisfactory percentage of nearly 96%, owing primarily to the 17 large and 21 small tents with beers from the top 6 local breweries. More than 78% of the visitors are recorded as visiting and reserving tents during the 17 days of the festival.
The average collection from these tents is estimated at €300 million with the major share coming from the beer steins. The rising inflation resulted in an average cost of €14.40 on a Maß in 2023, which is more than a 55% increase compared to 2002. During the festival, nearly 7 million liters of beer are poured, generating nearly 75.7 million Euros in gross revenue.
The inflation rate increases by over 3% yearly on an estimated cost of 2-liter beer and half a roasted chicken. However, that is mitigated by the consumer’s strong spending power, thus generating a good total profit.
The construction and dismantling cost of the large beer tents is nearly 1-2 million euros and bands playing traditional German music cost €200,000. The fool-proof security, especially after the Oktoberfest bombing, cost more than €400,000 but still, the organizers and Theresienwiese owner managed to collect nearly 7.8% of the turnover rent annually.
Other Oktoberfest Attractions Impacting the Economy
The Bavarian folk festival has something for all age groups, with nearly 43% of the population below 30 years of age. It offers festivities and attractions for families and children. Oktoberfest’s stalls, bars, restaurants, and amusement rides share an income of 140 million euros. The organization gets more than 1100 applications from carnival and market traders for a stand, but less than half of them can make their way to the tremendous festival.
Their economic impact extends to nearly €160 million in individual trade as both locals and tourists gather to take home souvenirs from the traditional carnival. Visitors love to buy authentic German clothes: Lederhosen, Dirndls, FC Bavarian jerseys, and historic beer mugs, among other offerings.
Another major revenue-generating attraction that draws tourism is Oide Wiesn. This tent has preserved the old festival traditions in a real sense. The visitors spend millions of euros each year to purchase the ticket for this tent and relive the history.
The Traditional German Beer Festival in Numbers
The data reveals that during the 17-day Oktoberfest festival, approximately 6.3 million visitors collectively spend about EUR 442 million within the festival grounds. This averages out to roughly EUR 70.22 per person.
In addition, visitors from outside Munich contributed significantly to the local economy:
- They spend an additional EUR 285 million on various expenses such as food, drinks, shopping, taxi rides, and public transportation within Munich.
- Specifically, visitors from outside Munich allocate around EUR 505 million solely for their accommodations during their stay at the festival.
Conclusion
Oktoberfest is a huge economic success for Munich, with attendance breaking previous records each year and beer consumption setting new heights. The good weather conditions during the festival days, the global image, its attractions like Family Sunday, Gay Sunday, traditional German clothing, and cultural preservation attract tourists and visitors from around the globe and thus contribute to the GDP, significantly.
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