This weeks tip is about creating a business plan and structure
around your career. It is important that you begin to realize
that you yourself are not only a product, but also an entity
and every entity must have an accurate plan to help progress
them steadily into success. Here are the finer details that you
should begin to plot out and plan for yourself and your career.
Objectives- This is the area where you first begin with your
mission statement, the reason that you feel that you are
needed by the world at large and specifically your local area.
It is in this section that you must also describe the nature of
your business (genre, what it is you do, and how you plan on
making an impact and money). Then you must weigh out all of
the consequences of starting such a career/business will make
on you, your life and all of the possible setbacks that you may
incur by following this career goal.
Business- This is where you describe your business’ character
traits. What successes have you had? What successes do you
wish to have business-wise? Under what type of business structure
do you wish to administrate under, sole proprietor, general
partnership, limited liability, corporation, organization, etc. It is
a good idea for the ease of taxes to start administrating all
business under one banking account and one name
(have a lawyer and accountant help you out with this). This
way when tax season rolls around you can easily back track
through your banking statements and receipts without having
too many other items to look over to find deductions and you
can open yourself up to many other types of business only deals
and discounts other companies and the government only make
open to established businesses. I am not a lawyer or an accountant
so to find out more about the many other benefits of operating under
a legal business status that would be the place to start. Also, in this
area you will want to write out the purpose of the other key people
involved with you (say for instance other band members).
Management- This is where you establish what your strengths
and weaknesses are, your experience as a musician, producer,
dj, etc., and the key responsibilities that you hold as a leader
of you business. This would also be a good idea to mention your
manager, their strengths and weaknesses, and responsibilities.
They along with you stand as the two key people that shall steer
your business’ boat, so what you want from them and expect of
them should be spelled out very plainly here.
Products- This is the area that you list and describe all of your
products (cds, t-shirts, posters and other swag items). It is a
good idea to have photos and to dig deep and set out reasonable
prices, find manufacturers for your different products and list
their different quotes here. Calculate all of the costs, likely shelf
time (the time it’ll take you to push the product), how much
profit each item will usher in and the advantages and disadvantages
of each product you sale. For instance and upside to selling
t-shirts is they are relatively cheap to manufacturer and thus provide
great profit margins, however they only tend to sell for most artists
at live events until you become well known.
Market targeting information- This is where you’d list your major
competitors in your area and/or on a larger scale. List their
strengths and their weaknesses and why you have or don’t have the
upper hand against them. It is here too that you list your target market,
who it is that you believe would most connect to your music? From here
you could list ways you could cross promote with other companies
that relate to the same demographic and create a buzz within those
circles about your act. A lot of market research can also go a long way
here. Big labels will often spend time giving away up to 2000 or more
white labels (cds with a white cover that introduce artist to the “streets”
and usually just list the artist name). If the artist is considered good
these copies travel around neighborhoods and the artist develops hype
before any major promotional push is created and the label gets the
research data they were looking for. In this section it is a great idea of
course to plot out as detailed as possible all of the ways, places and things
you are going to do to get your music out there and heard. For instance
are you going the club route, the college route, festivals and fairs, radio
and television or stomping out your own way. Also any ideas that you
have about a street team and tasks that you could assign to them would be
perfect for this area.
Sales information- Here again you can give a brief paragraph explaining
how you wish to market your products, most importantly your cd. You
list pricing, profit margins, sells projection and goals here. While there
is no true way to predict how much you are going to sell its still a good
idea to try and figure out a ball park figure. Also here you would list how
and where specifically are you planning on selling you products
(online stores, brick and mortar-major chains, mom and pops stores,
coffee shops, etc., at shows, on your website and on and on).
Vendors- In this section list all of your potential suppliers; everything
you’ll need from equipment down to light bulbs. Where are you going
to manufacturer your items and what equipment do you need right
now? How do the manufacturer and supplier quotes look next to one
another? Where will you save the most money without skimping on quality
and customer service? Are you going to pay with cash or credit, what
are the ups and downs of each of these options? And how does the
quantity of an order effect the pricing, which manufacturer or supplier
is best with a higher quantity order? These are some of the things
you’ll want to look at here.
Employees/Staff- What is the number of people/employees are you
going to need to be involved? What types of positions are needed to be
filled (manager, agent, lawyer, accountant, street team, publicist,
street team members, fan club presidents, web designer, producers,
engineers, songwriters/composers, musicians, etc)? Though these
individuals aren’t necessarily under your complete control they
and many others are needed to complete your vision and thus need
to be accounted for.
Location- Where is your headquarters going to be? Is it somewhere
that you have access to all the time or simply a friends garage or
basement? Do you own a studio that you can record in or are you
going to record at a professional studio? If so where is that placed?
What is the costs of working out of this area (not just the financial
ones)? How long do you plan on working from this area? Is it even
legal to work from where you are currently located zone-wise?
Cash flow and Accounts- Where do you think your profits from your
career will be in a year? How about two? Now, how about three years
from now? What are your monetary goals? How do you expect to reach
them? How will the cash flow break down once it is in your possession?
Will an accountant be handling this for you, what banking system will
you be using? Who gets paid first? If you’re in a band how will your spilt
the profits amongst members, will everyone be paid equally or will the
people that take up more of the work load get more? How do your cd
points break down, will the songwriters get paid more as well? These
are all things that you must think about ahead of time to avoid huge
problems in the future. Once money enters the scene anything not
written down hardly ever stands.
Financing- Lastly is the financing sector. Being a musician it is
unlikely that you will be able to get a bank to loan you money
for your next project or swag items. This is because banks usually
use a scale to determine exactly the amount of risk they’d be
taking on regarding your career field, let alone your personal credit
history (depending on your business’ structure usually). The
entertainment sector usually rates between a 8-10 out of a 10 point scale,
so obviously you’ll have to look elsewhere. Credit cards, friends, family
members, and angel investors (people that believe in you enough that
they just want you to succeed and usually aren’t looking for you to
even return their investment to you)/some hard lender (not advised)
are seemingly the only route for musicians to go, although some of the
cd manufacturing companies have set it up with banking services to
offer credit loans for the manufacturing portion, though the interest rates
I’ve seen tend to be fairly high. So what are the avenues you are going
to pursue to reach your financing obligations (fixed costs, studio costs,
hired help, equipment, manufacturing, etc.). This requires a lot of
creative thinking and action to make everything pan out, so put those
creative brain cells to work in this area just as you do in creating your music.
So these are the steps you need to create and plan for your music
business/career venture. It will take up a lot of time particularly
in researching these different areas, however, planning is everything.
With a plan you have directions; where without it you have none. Will
things go exactly to plan? Well no, never exactly as planned, but at least
you have a place to reconnect and get your vision back on course. This
is an important step that most musicians skip over purposely to avoid the
dredged business side of the industry, however, as an indie it is super important
that you cover this area of your career as you would the more
creative sides. Remember failing to plan is actually planning to fail, so its worth
your effort to do this in the beginning of your career and project beginnings
rather than later trying to save a sinking ship. Next week I’ll finish up with the
third and final tip that every musician should know.
Now, Get Out There And Manifest Your Career’s Success!
Tags: indie musician advice, music business articles, music business tips, music tips