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Article Title:
How to Start Your Own Indie Record Label In Just a Few Simple Steps!

Article Description:
Since it is so difficult to get a contract with a big label and 
the competition for jobs at the big labels is brutal, you may be 
better off starting your own record label. However, before you 
even begin your career in the music business, you need to answer 
several questions. 

Additional Article Information:
1160 Words; formatted to 65 Characters per Line
Distribution Date and Time: Wed May  3 21:12:48 EDT 2006

Written By:     Ty Cohen
Copyright:      2006
Contact Email:  mailto:[EMAIL PROTECTED]

Article URL: 

For more free-reprint articles by this Author, please visit:


How to Start Your Own Indie Record Label In Just a Few Simple Steps!
Copyright © 2006 Ty Cohen
The Ultimate Record Label

Since it is so difficult to get a contract with a big label and 
the competition for jobs at the big labels is brutal, you may be 
better off starting your own record label. However, before you 
even begin your career in the music business, you need to answer 
several questions. 

It doesn't matter if you are starting a band, are wanting to 
start your own label or even just setting up a recording studio.

Define Your Business Goals

You need to sit down and write a formal business plan. I know 
that sounds like total dullsville, but, believe me, you need to 
do it. Without careful planning you will only be wasting both 
your time and money. While the music business is glamorous, it is 
also a cut-throat business and the more experienced players will 
eat you alive and leave you bankrupt if you don't take the time 
to properly set up and plan your business.

You need to determine what resources you already have and what 
resources you are going to need to get the business off the 
ground. List items such as: the people involved, equipment owned, 
experience in music, experience in business, available working 
capitol, a place to work from (it can be your basement or garage, 
but you will need somewhere to work.), business contacts, music 
gigs, available working capitol, etc.

No matter how musically talented you are, you cannot start your 
own record label without working capital and some basic business 
knowledge. If you don't have it, find a partner who does if you 
want to be successful, or take a look at the financing guide 
available along with the How to Start a Record Label course over 

Products and Services

What are you going to produce and sell? Please don't answer 
music. You need a more concrete plan then that to be successful. 
Will you be making CDs of your live performances? Or will you be 
writing and recording your own original compositions? 

In either case, be specific. You will need enough material to 
record an entire CD before you can sell it. Don't forget that 
if you don't own the copyright to the lyrics and music, you 
will need to get permission to use them or risk being sued for 
copyright infringement. Trust me, if you are successful and using 
someone else's copyrighted material, you will get sued. So, draw 
up a royalty contract with the copyright owner before you record 
the material. 


I don't necessarily mean who is recording the same kind of 
material. I assume you already know that. I mean who are the 
other independent labels. These are some of the things you need 
to find out:

 * What is the going royalty fee?

 * How much can you charge to rent out your studio? Or what 
   should you be willing to pay to rent someone else's studio?

 * Who are the best people to distribute your CDs? What will it 
   cost you? Can you negotiate fees?

 * What is your Unique Selling Proposition? In other words what 
   make you stand out from the pack? How are you better than all 
   of the others like you?

 * Have you created a "brand" yet? By "brand" I mean a something 
   that makes you unique and different. KISS and Madonna certainly 
   have a unique brand. You need to develop your own "Brand"

You'll learn how to do this and everything else needed to start 
a record label by visiting 


Who are you going to sell your music to... who is your target 
segment? Teens in general, rap fans, jazz, country, hip hop fans, 
etc? How do you plan to reach your target audience? Will you send 
letters to the DJs, advertise in the local media, seek free 
publicity by doing free concerts, make sales calls, use an 
internet website, etc? 

In other words, if you aren't familiar with marketing, you better 
get familiar or find someone who already is to work with you. 
In the competitive music business, you must shamelessly promote 
yourself every chance you get. The public has a very short memory 
for artists and unless you keep your name out there in front of 
them, the will completely forget about you. Think about all of 
the "one hit wonders".

Establish Your Business

Decide of a legal structure. Your choices are sole 
proprietorship, partnership and corporation. Because of all of 
the different skills needed to operate your independent record 
label, partnerships are the most common form. Unless you already 
have a lot of money or property, a sole proprietorship or 
partnership should be sufficient. You can always upgrade to 
a corporation when you have sufficient assets to need the 
protection incorporating provides. 

If you choose a partnership, draw up a partnership agreement that 
lists in detail what each partner brought to the company, what 
their duties and responsibilities are and how they will share 
profits or losses. A partnership agreement is extremely important 
to avoid future problems. 

Next, go register the business with the proper legal 
jurisdiction. Once you are registered, you can rent space, lease 
equipment, open accounts with vendors and do all of the other 
things necessary to operate a business. Join the professional 
organizations both in and outside the music area. It never hurts 
any business to join their local chamber of commerce. In fact 
that can be an excellent source of referrals.

Working Capital

Now that you are a registered business, you need to start a 
business checking account and get a credit or debit card so you 
have a way to pay your business bills. You will also need to 
set up books to record income and expenses to use for later tax 
reporting. If you aren't familiar with the tax requirements for 
small businesses go to your local small business development 
center. Most states have them and they provide either free or 
low cost assistance, advice or classes so you can learn what is 
required by law. Alternately, you can hire an accountant to do 
your bookkeeping for you.

I'm sure you heard the horror stories of a performer robbed blind 
by their accountant or business manager. So, even if you can 
afford to hire a business manager or an account, learn about 
keeping books and the legal requirements so the people you hire 
can't cheat you quite so easily. 


You will need some type of business insurance. Consult with the 
small business development center to see what they recommend 
you should get. You can ask an insurance professional but, 
unfortunately, they will tell you that you need everything and 
that really isn't true when you are first getting started in 
business. When you become successful, then you will need all of 


Careful planning will get your independent record label off to a 
good start. If you take all of the necessary legal precautions 
you will save yourself a lot of trouble in the future.

Ty Cohen is the acclaimed author of over a dozen 
best-selling music industry "How to" books and courses. 
Grab a copy of Ty Cohen's latest book title by visiting and to learn more about 
starting or turning your existing record label into 
a world wide, profit pulling record label visit:
Start A Record Label Today!



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