Establishing a Music Recording Studio - Example

Business Plan for Music/Recording Studio Business Profile I plan to establish a music recording studio that will cover all genres of music. I purpose to assess recordings of the various genres of music and introduce changes where necessary. My major concern is the enhancement of quality, convenience and friendly relations with music artist. The studio will be located in my home office, and clients will be free to visit any time of the day. The demand for music recording services has been on a rise in the recent past and, therefore, seizing the opportunity to establish a studio is a wise decision (Field, 2010). In essence, the available music studios are not enough to meet the ever increasing demand in the music industry. In this regard, setting up a music recording studio has been an inevitable business idea for me. Music recording has been my lifetime dream and pursuing it will be my greatest achievement. Targeted market and Customer My target customers will be the both the established and the upcoming music artists below the age of 25 years. In addition, I also target major music distributor in the area. In essence, the distributors of my products will be the established music distribution agents in the area. For the supplies, I will incorporate online platforms to enhance convenience and avoid delays. The main music genres to emphasize on include hip hop, dancehall and jazz music. The target market for the studio will be the urban population. People in the urban areas are usually informed and ahead of people in the rural areas in terms intellectual capacity. In addition, the urban population easily accepts change and new developments. In this regard, targeting the urban population will facilitate the generation of promising returns as well as future business expansion (Rogers, 2013). Growth trends The music industry is developing at a very rapid rate. In essence, the number of upcoming artists keeps on rising year after year (Jones, 2012). Generally, the entertainment industry has portrayed massive progress in the past few years, and it is projected that it will continue developing in the coming years. In this regard, the needs for music recording studios will continue increasing. For this reason, my studio will focus on quality music production and talent development among the upcoming artist. Actually, one of my major concern is to keep the same pace with the growth trends in the industries. The industry has many competitors and, therefore, the failure to keep the pace of growth trends might result in the closure of the business within a short time. Pricing power At first, my pricing power capacity will be influenced by what other music studios charge for their service. In essence, I anticipate to create friendly relations with my clients with time. In this regard, I expect my services to be above the average rating in the market. Since my major concern is quality and convenience, I expect that my reputation will surpass that of competitors within a short period of time. It is my belief that good reputation will give way to some degree of pricing power. The quality of output matters a lot in any business. When clients are satisfied with the quality of services provided, the pay will be outstanding and vice versa. In this case, I anticipate to have more pricing power due to quality and good relations with clients. Risk management The business is exposed to many unforeseen uncertainties. For this reason, I will strategies effective risk management measures to facilitate continued profitability and quality service delivery to clients. Among the various risks that the business is exposed to include fire, theft and bad debts. There are a number of risk management option that can be employed to reduce the impact of loss or to prevent the risk from happening at all. Before choosing a particular risk management strategy, it is imperative to assess the probable damage and the economic implication of the plan. Some risk management strategies are very expensive to be afforded by new business concerns. In this regard, it is important to assess the economic value of the risk management plan before taking the action of implementing it. I will take a general insurance cover for the business. In this, risks such as fire and theft will be covered, and I would be assured of indemnification in case any of the insured risks occur. Another risk management strategy I will employ is training my workforce on the appropriate use of office equipment. This will aid in reducing workplace injuries and confusion among the employees. In addition, training the employees on the appropriate use of the studio equipment will help in reducing the repair and maintenance expense. The core objective of wanting to start the business is to maximize profits and minimize cost by all possible means. In this regard, I believe that my risk management strategies will boost returns and reduce expenses at a considerably high percentage. Communication The competitiveness of the industry requires effective marketing techniques. One of the best mechanisms to survive in a competitive market setting is to establish sound communication techniques to reach as many potential customers as possible. Some of the marketing techniques that I will employ to popularize my business include advertisements and product promotion. Advertisement Advertisements have proven to be effective tools of passing information in competitive business environments. There exists several advertisement platforms that can be used to inform, remind and persuade customers to continue purchasing services from my studio. Some of the platforms I intend to use include media advertising and online advertising. For the media advertising, I will use radio and television advertisement. Research has shown that almost every family possess a radio or a television set. In this regard, using radio and television as advertisement platforms will aid in reaching many customers across the country. According to Straubhaar, LaRose & Davenport, 2010). Television and radio advertisements are very convincing and for this reason I anticipate to have a large number of customers by the end of the year. The modern technology has given new life to the advertising practice. With the modern technology, advertisement campaigns have been made easy and convenient for both the business and the customers/clients. My business will incorporate the full use of the modern technology to advertise the available services and new development. I intend to establish a website for the business where important information regarding location, service rendered, and the support staff will be displayed. In addition, I will incorporate the social media platforms such as Facebook and Twitter to conduct the advertisement campaigns. Millions of people visit the various social media platforms every day and, therefore, advertising on social media is a very appropriate approach. In essence, most music artists are in more than one social media sites and, therefore, advertising on social media will serve as a convenient location for the target customers. The social media site have received widespread recognition in almost all lines of business. In this regard, effective utilization of the social media can bring enormous benefits to the business (Tschmuck, 2012). Service promotion After carrying out research and a lot of survey in the music industry, I have learned that product promotion cannot be avoided in any venture. For this reason, I intend to use various product promotion approaches to popularize the studio. In the first two months, I will allow the clients a discount of fifty percent for recording more than one song. In addition, I will offer services for credit to customers who bring new customers. After the first six months, I will organize an award ceremony for the loyal customers. By the end of the first year, I will sponsor at least two upcoming artist to perform in the nearby town in order to popularize their talents. Hund-Göschel (2009) argues that Sponsoring artists will attract other artists who might be having financial problems to record their music. As a service promotion strategy, I will produce T-shirts bearing my studio’s name and logo to give the artist who will record music with the studio. This will aid in developing a good public image for the studio and making it known to many people. Music artists perform in many towns and giving them T-shirts will enhance the spread of information regarding the studio in all areas that they visit. Studio budgeting My initial business costs will be the purchasing of the music recording equipment, electricity expenses, and salary for employees. To operationalize the studio, I will require at least two desktop computer, one laptop, one recording machine, four speakers, one scanner, one photocopier, a telephone, internet connections, two guitars, and two sets of microphones. The estimated initial cost amounts to about $2000. I have developed an effective strategy for raising the initial investment capital as discussed below. I anticipate to raise 50% of the total initial costs from my yearly savings, 35% from a bank loan, 5% percent from the friends and relatives, 5% from well-wishers and 5% the sale of my old computer. I am optimistic that my financial plans will be successful and that the studio will run smoothly without many financial drawbacks. Through research and past experience, it is clear that financial challenges are the major causes of business failure in the modern economy. Actually, without sufficient initial cost, the business cannot com not existence since the purchase of basic initial requirements will not be possible. The established studios in the music recording industry have enabled me to learn many business tactics especially on matters of financing. It is usually challenging for a business to thrive without a substantial contribution from the owner to the initial capital. The person willing to invest in any business should have at least 50% of the required initial cost. Starting a business with most financing coming from creditors is very dangerous. It is quite obvious that a business will take some time before starting to generate reputable returns. If the business takes too long to start generating sufficient returns, the creditors might demand their money back. If such an event happens, the business owner may be forced to sell the assets of the business and thereby terminate the operations. Marketing Marketing plan At the early stages of business initiation, I will spend at least six hour every day to address clients’ problems. I will charge comparatively low prices than the competitors at the initial stages of the business. In addition, I will use selective pricing in order to suit the needs of every client. Established artist are economically stable and can afford to pay high charges. The upcoming artists are financially incapacitated and may not have the power to meet high charges. In relation to this reason, I would charge less price to the upcoming artist compared to the established artist. Growth program and vision I have a great vision for my anticipated business concern. The size of the studio will not remain the same for the entire period of operations. I intend to increase the number of office for the studio in future. Each office will address one particular issue to enhance proficiency and reduce workload per head. In anticipate to expand the studio services to major towns with the area. In this regard, I intend to establish constituent offices in other areas and make the current proposed location the headquarters. My vision is to establish a multi-billion company that will offer all services related to music recording. To succeed in this, I purpose to work with the established studios to learn their tactics and how they survive in the industry. In addition, I will work with potential investors in the industry in order to spread risks and also attain financial benefits. Expansion of any business concern is an expensive undertaking that requires enormous resources. A wide scope of knowledge in the field is required and sufficient finances. In summary, the development of the business plan has been well organized, and all factors relating to music recording have been put into consideration. Effective implementation of the plan will see the studio grown past the region and national borders. The expansion mechanisms and the vision of the business concern have been well developed. Generally, the success of the business will generate enormous returns to all the stakeholders. Reference list: Field, S. (2010). Career opportunities in the music industry. New York: Ferguson. Hund-Göschel, A. (2009). Music sponsorship at a turning point. Lohmar: Eul. Jones, M. L. (2012). The music industries: From conception to consumption. Houndmills, Basingstoke, Hampshire: Palgrave Macmillan. Rogers, J. (2013). The death and life of the music industry in the digital age. New York: Bloomsbury Academic. Straubhaar, J. D., LaRose, R., & Davenport, L. (2010). Media now: Understanding media, culture, and technology. Boston, MA: Wadsworth Cengage Learning. Tschmuck, P. (2012). Creativity and innovation in the music industry. Berlin: Springer. Read More