OK folks, this is something as musos we all need to focus on. [A music business plan]. I know what you're thinking; "I'll leave that to my manager," Which is probably OK, "if you got one of course". But understanding about the business side of any business, is your key to failure or success.
Most musicians want to play music, and fair enough, that's why we pick up our guitars and keyboards, drums, [in the first place], isn't it? But what happens when you start to earn some money? "We'll split it between the band members." Well, that all sounds good in theory. But there are some things to consider first. Let's have a look at a made up scenario.
[We'll go with the assumption that this is an all originals 4-piece band]. So, the first question is "who wrote the songs?" [Again, we'll go on the assumption that the singer and guitarist wrote the first drafts of the songs, having a 50% equal share, in the ownership of the songs, and the rest of the members came in with their contributions later on.]
Now, we'll go down the track a bit, and you have played a couple of awesome shows and sold a truck load of home-made Cd's. You all go back to your practice area, and there is your profit sitting on the coffee table. $1000. You beauty.
Drummer and bass player pipe up and ask for there $250 each for their efforts, as originally and verbally agreed upon in the beginning. But, guitarist, mumbles to the singer and says, "but we wrote all the songs!"
Question is, where do we go from here? The drummer and Bass player are within their rights to ask for what was, verbally agreed. Remember, [We'll split it 4 ways]. "But the singer and guitarist are the rightful owners of all the songs that the band is playing, and deserve to have the lion's share of the profit." RIGHT??
This is when, a business plan in the beginning, would help set up a payment system within the band before there were any profits to divide.
What elements then, do we need to look at, to start a music business plan?
How you do business with your fellow band mates, will decide if your band can survive the hills and valleys that it will go through, so take your time in these areas and make sure everyone understands what is happening, and their requirements and responsibilities. It will save a lot of heartache, time and stress.
Most musicians want to play music, and fair enough, that's why we pick up our guitars and keyboards, drums, [in the first place], isn't it? But what happens when you start to earn some money? "We'll split it between the band members." Well, that all sounds good in theory. But there are some things to consider first. Let's have a look at a made up scenario.
[We'll go with the assumption that this is an all originals 4-piece band]. So, the first question is "who wrote the songs?" [Again, we'll go on the assumption that the singer and guitarist wrote the first drafts of the songs, having a 50% equal share, in the ownership of the songs, and the rest of the members came in with their contributions later on.]
Now, we'll go down the track a bit, and you have played a couple of awesome shows and sold a truck load of home-made Cd's. You all go back to your practice area, and there is your profit sitting on the coffee table. $1000. You beauty.
Drummer and bass player pipe up and ask for there $250 each for their efforts, as originally and verbally agreed upon in the beginning. But, guitarist, mumbles to the singer and says, "but we wrote all the songs!"
Question is, where do we go from here? The drummer and Bass player are within their rights to ask for what was, verbally agreed. Remember, [We'll split it 4 ways]. "But the singer and guitarist are the rightful owners of all the songs that the band is playing, and deserve to have the lion's share of the profit." RIGHT??
This is when, a business plan in the beginning, would help set up a payment system within the band before there were any profits to divide.
What elements then, do we need to look at, to start a music business plan?
- COMPANY SUMMARY - This section discusses registering your band as a company, whether it’s Sole Proprietorship, Partnership, Corporation or an LLC.
- PRODUCTS AND SERVICES - This is where you can discuss what type of products your band plans to sell. E.g. digital downloads, merchandise, live shows, and CD’s.
- MARKETING ANALYSIS - That put simply is, "HOW IS YOUR BAND GOING TO STAND OUT AMONGST YOUR COMPETITION?"
- MARKETING - Identifying your target demographic, raising awareness of who you[band] are, and what type of music you intend to play. Price structures for your releases and where customers, can buy your goods and services.
- MANAGEMENT - Here, we get to delegate responsibilities [bookings, receiving payments for gigs, Cd sales, etc.] to everyone who is in your group, now that might only be the member's in the band at the moment. But it is important everyone knows what their responsibilities are, in the group's business dealings. But you need someone first, to head this team!!
- MONEY - Once you work out what you want to sell, you then need to work out where the money is coming from and who will pay for these upfront costs.
How you do business with your fellow band mates, will decide if your band can survive the hills and valleys that it will go through, so take your time in these areas and make sure everyone understands what is happening, and their requirements and responsibilities. It will save a lot of heartache, time and stress.
[Hi everyone, my name is Darryl Steele and I am going to fill you in on my own music business
plan. "I don't have a music business plan". I am now 44, and after 25 years since the first band I was in,
it is now that I am looking into a music business plan with the
original singer from that band.
We aren't even at section 1. COMPANY SUMMARY. We have discussed it [COMPANY SUMMARY] and agreed that this is what we need to do. But, a more important detail has occurred to me than the steps mentioned above. "It is probably more important than just a detail." Its communication, and the time needed to transfer and to understand all the relevant information between each person/member of your band/team. Communicating in a respectful manner is vital at this stage, and that all parties involved are on the same playing field, and not relegating a band member, a "less important person" because they don't understand all the details as quickly as everyone else. Patience is the key here.
"Just to let you know, I'm not very clued up on business thinking, so when I talk business, I like to take my time to understand each part of that business conversation, and that I'm happy with what transpired at the end of the meeting/conversation, before I can move on, to what is next." Hopefully jamming!
Cheers Darryl
Cheers Darryl
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