Promotion of the audio equipment rental business. Recording studio business plan
In this material:
In practice, opening a recording studio as the main source of income today is a promising and profitable business line. A recording studio business plan contains recommendations regarding the process of organizing and registering a business project, as well as requirements for premises and equipment, customer search opportunities, and financial analytics.
Should I open a recording studio today?
Today, the domestic consumer does not have high requirements for the quality of the music being listened to, on the basis of which recording studios opened in small premises, with a modest staff, and not equipped with expensive equipment are in demand. These recording studios quickly pay off the initial investment and reach the break-even point. At the same time, projects with significant upfront investment will be much slower to develop and more difficult to compete, given the need to recoup the initial investment.
Beginning and popular musicians strive to win the fight against piracy by posting their own tracks on the Internet, where there is no need to talk about high-quality sound recording. Due to this, in order to save money, it will be enough for such performers to use the services of a more budgetary recording studio. It is also often beneficial for musicians and performers who continue to record professional CDs to replace a rehearsal studio with an affordable recording studio.
List of recording studio services
A professional recording studio provides the following services:
- recording, as well as mixing tracks and full-fledged music albums;
- recording musical accompaniment for commercials;
- voice-over of videos, translations and localizations of films and serials;
- work on arranging compositions;
- recording remixes of popular tracks, creating mix albums;
- etc.
The quality of the services provided and their range are enhanced by the acquisition of new sound recording equipment and the modernization of existing equipment.
Additional sources of income
For additional profit, it is recommended, in addition to the traditional services of a recording studio, to rent premises for rehearsals for novice musicians. Today, beginner musical groups and solo performers often have a problem with the lack of space not only for sound recording, but also for rehearsals before recording, performances, concerts. By allocating a separate area in the rented premises for creating a rehearsal room, you can diversify the sources of the profitable part of the business project.
In addition, it is recommended to rent sound equipment to beginner musicians and bands for an additional fee. Beginning performers, who are limited in funds at the initial stages, often do not have their own musical equipment and rent it for use not only for sound recording purposes, but also to equip venues for concerts and performances. In this case, you need to take care of the additional purchase of special concert equipment for subsequent rental.
Not only musical bands and professional performers turn to the services of a recording studio - various advertising agencies that need to record voice acting for a music video at a professional level or provide a video sequence with musical accompaniment will also become your clients. In addition, the services of a recording studio are in demand by videographers who shoot weddings, celebrations and various festive events in order to record professional musical accompaniment to the final video.
Where to begin?
Studio Registration
To carry out activities, state registration will be required in the form of an individual entrepreneur without forming a legal entity, or in the form of a limited liability company or an open or closed joint-stock company (for professional large studios with impressive initial costs). The optimal form of regular payment of tax payments is a simplified taxation system, in which 6% of income or 15% of the amount of net monthly profit goes to the state budget. In addition, this form of taxation does not imply the regular need to prepare complex tax returns and financial statements, so at first you can do without the expensive services of a certified accountant or involve a third-party specialist.
room
The best option is a room with an area of about 50 square meters, divided into three zones: a room for direct recording of performers, groups and musicians, a separate room for sound recording equipment and a sound engineer, as well as a small lounge that acts as a reception room. You can organize a room for a recording studio at home, however, the solidity of the organization will be emphasized by renting a separate non-residential premises. The first option, however, will save significant funds at the stage of initial investments and operating expenses of the studio.
Particular attention should be paid to the soundproofing system, since this system is essential for the efficient operation of the sound recording equipment of the studio. In particular, soundproofing is important when arranging a recording studio in your own or rented apartment in a residential building in a residential area. It is recommended to use durable special triplex glass to separate the zone of location of the sound recording equipment and the work of the sound engineer from the room for direct recording of the performers' performances. Among other things, the premises for the recording studio must comply with fire safety standards and the requirements of sanitary and epidemiological control.
A recording studio does not imply the employment of a large staff, for effective work it will be enough to hire a qualified and experienced sound engineer, as well as an account manager, whose duties will also include conducting a regular marketing campaign to attract new customers. It is recommended to carry out the functions of the studio administrator at the first stages on your own. At certain stages of its activity, the studio may need the professional services of an accountant and a lawyer, who are recommended to be involved as outsourcing specialists, and not employed on a permanent basis.
Equipment
The acquisition of the necessary equipment for a recording studio without fail forms the articles of initial investment. You will need the following equipment:
- several professional microphones with stands and noise reduction;
- closed headphones;
- midi keyboard;
- a personal computer equipped with an expensive modern sound card and special studio monitors installed in the sound engineer's work area.
Among other things, you should be puzzled by the acquisition and installation of full-featured licensed software suitable for professional recording and sound processing.
How to look for clients?
A constant flow of clients and workload, and often overload of the studio with orders, ensures a high and stable level of the profitable part of the business project. Leasing a separate space for rehearsal purposes in parallel with the provision of recording services will attract new customers and provide additional income. Do not abandon the traditional ways of advertising services: print media, radio and television, posting ads, advertising on thematic Internet resources and music forums. A separate effective component of the marketing campaign will be the creation of your own business card website for a recording studio and the promotion of the project in the publics of popular social networks. The organization's website is equipped with a price list with a list of services provided and prices, a page for the studio's portfolio, as well as contact information for the account manager, indicating the location of the recording studio and work schedule.
Financial component of the project
Recording studio investment and running costs
The initial investment required to open a studio is formed from the costs associated with the state registration of an individual entrepreneur, a limited liability company or an open or closed joint-stock company, as well as the search and rental of suitable premises, repair and design work, and the acquisition of the necessary professional recording equipment, computer equipment and office furniture. In addition, start-up costs include costs associated with the organization and conduct of the initial advertising and marketing campaign. Depending on the region where the studio is located, the list of purchased equipment and other factors, the amount of initial investment reaches an average of 500-800 thousand rubles.
Operating expenses are formed from tax payments, rent and utilities, salaries of employees and costs associated with conducting regular marketing campaigns to attract new customers. On average, the monthly expenses of a recording studio range from 100 to 200 thousand rubles.
Income and calculation of profit and profitability
Taking into account the modest payback period of the business project, the net profit with a stable flow of customers is about 70 thousand rubles a month. The profitability of the project is about 32%, the payback period of the business is about a year.
Possible risks
Opening a recording studio in a small town is associated with the risks of low demand for services and an unstable client flow. At the same time, setting up a recording studio in a metropolis implies a high level of competition. Among other things, the potential risks of a business project are unfavorable social and external factors, the low effectiveness of ongoing advertising campaigns and the inability to attract qualified personnel.
The business of providing recording services to clients, additional leasing of space for the rehearsal area and sound equipment for organizing concerts is accompanied by entrepreneurial risks, but is a promising way to extract permanent profit.
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The prices for our services are formed on the basis of several components.
Number of equipment
Equipment class
Event date
Fare
Event duration
Technical staff work
How to calculate the amount of musical equipment
The amount of equipment is calculated based on factors such as the number of people, the program of the event and the area of the space. For example, for a small conference of up to 100 people in an ordinary assembly hall, a set of equipment from two speakers on stands and a pair of microphones, as well as a projector with a screen, will be enough. If we are talking about a concert of a musical group, then such a set will obviously not be enough.
Which class of audio equipment to choose
The class of equipment also affects the price. Each manufacturer of musical equipment is counting on a certain segment of users. For example, a summer cafe on the beach or a wedding DJ is unlikely to buy an expensive line array for their daily work. And for a concert hall or a street stage on City Day and similar events, where performances by famous artists are held and several hundred or thousands of people gather, two budget columns will obviously not be enough.
Date of event and price for technical support
Like most activities, our work has seasonal ups and downs. There are several peaks in the demand for our services in a year, and they all fall during the holidays. On holidays, the prices for renting musical equipment become more expensive than usual. Please be understanding about this. Any holiday is very good, but we work, and you rest.
Transportation of concert equipment
Our equipment is located in Moscow, Sochi and Krasnodar, but we often work in other cities as well. For the transportation of equipment, we use freight transport, which we hire together with a driver. If the event allows you to bring equipment and immediately release the car, then this will minimize transportation costs. If the equipment needs to be transported over a longer distance, or we are talking about a series of concerts in several cities, then as a rule we hire a truck with a driver for the entire time of our work. We also include these costs in the cost of our services. If you want to reduce their cost, then in some cases this can be done at the expense of transportation. If you have such an opportunity, you can take over the transportation of equipment to and from the event.
The complexity of the event and its cost
Despite the general similarity of scenarios and technical equipment, each event is unique in its own way. Everywhere there are nuances that we are accustomed to take into account. For example, when only one musical group performs at an event, which comes with its own sound engineer and lighting designer, then from our side there is no need for this work. It is enough for us to prepare the site for their requirements and just make sure that someone else does not accidentally pull out any cord from the outlet. Or when a big program is started, and the bands on the stage are constantly changing and the equipment is being re-wired to the requirements of each artist, then the amount of our work increases noticeably. All these points must be taken into account when forming the terms of reference and, accordingly, the price of our services. That is, if you say "There's nothing complicated, you just need to put the speakers on, turn on the music and that's it." So we just put the speakers on, turn on the music and that's it)) We will come to other options less prepared. In order for us to understand exactly what is required of us, tell us about your event in more detail.
Event technical staff
As mentioned above, each event has its own characteristics in conducting and servicing. These features are formed, among other things, from the technical rider of the event. One or two people can easily cope with some technical tasks, and somewhere a whole team will be needed.
Everything will depend on such basic factors as:
To develop your own business, there are a huge number of business ideas. One of them is the opening of a recording studio. This case is rather unusual. For its success, it is necessary not only to "get sick" with this, but also to be well versed in this area.
First steps
Only a person connected with music can open his own recording studio and develop this business. That is why there is practically no competition in this area.
Where to begin? First of all, you should draw up a business plan for a recording studio. The development of this document is the initial step for any enterprise. A recording studio business plan will systematize all the main points that need to be considered and will allow you to determine the prospects for the future. A pre-compiled document will give a concrete visibility of what will happen after the implementation of this project, what will be the amount of profit, according to which scheme it is best to act.
Is this business profitable?
Does it currently make sense to open a recording studio from scratch? It is worth considering the fact that today the one who makes sound recordings at home receives the most profit. Studios equipped with expensive equipment and having large areas, for the most part, stand idle and suffer losses. The majority of musicians do not require good sound, therefore, they are not going to overpay for quality, especially since most of the compositions and songs are posted directly on the Internet.
There are music groups that are willing to pay for CDs. However, at the same time, they want to record only during their rehearsals in their home studio. In addition, most consumers download music online. Selling discs brings only a loss, and therefore few people care about high quality sound.
Room selection
Renting a music studio, which is equipped with expensive professional equipment and is located on huge areas, is currently inappropriate. It is enough to open such a business at home. If there is no own apartment for this, then a suitable room should be found.
The business plan of the recording studio should provide for rent. Such a room does not have to be located in the city center. An apartment for your own studio can also be rented in a residential area. In addition, it will cost much less.
The size of the apartment may be small. Enough twenty to thirty square meters. However, it is worth taking care of good sound insulation so as not to disturb the residents of the house.
List of required equipment
Today, opening your own recording studio in an apartment has become possible thanks to the development of digital technologies. This will require the purchase of special equipment. The recording studio business plan should include a detailed list of all the necessary equipment. This list includes the following:
A computer with good power and a decent sound card;
- studio monitors;
- midi keyboard;
- microphone stands with microphones;
- Closed-back headphones
The business plan of the music studio should also consider the further preparation of the project. You will need to install special software on your computer. It must be licensed. This is important for bringing the performer to a serious competitive level.
It should be borne in mind that the purchase of paid programs will require additional funding. This will pay off with the trust of even the most demanding client.
In addition, the licensed programs have a lot of functionality. This will allow you to record sound of better quality and at a high level.
Those entrepreneurs who do not want to invest in licensed software can find certain programs on the net that are legal and at the same time free.
Just don't write pirated versions.
Start-up capital
The cost of the necessary equipment for sound recording will cost approximately one hundred and fifty thousand rubles. For an hour of studio work, a fee of 500 to 1000 rubles is charged. With a sufficient number of customers, the income is small, but stable.
When selecting staff, the arranger and composer may well be replaced by a talented sound engineer. This will reduce payroll costs.
Additional services
A recording studio, whose business plan should provide for all possible development prospects, can specialize in a particular area. Either live or electronic music is recorded here. Appropriate equipment must be purchased for the chosen direction. The design of the music studio should also be carefully considered. This will allow renting the premises for rehearsals, because musicians, as a rule, do not have enough such areas.
It is worth bearing in mind that the studio recording business is not an independent project. This is part of show business.
Currently, the number of musical groups is increasing. Some of them eventually reach a decent professional level. In this regard, musical groups need to rent sound equipment. They need equipment not only to record works, but also to organize their concerts.
Young performers are usually limited in funds. That is why they rent equipment. A recording studio business plan should take this into account. Concert equipment can be purchased separately. This will allow you to earn some income.
Those people who want to record congratulations for relatives and friends can pay attention to the recording studio. Parents will enjoy listening to songs performed by their children. There are also amateur musical groups that will need to record individual songs or entire albums.
These days, there are plenty of unfilled business niches that can be very lucrative.
One of these types of business is the provision of musical and lighting equipment for temporary use. Indeed, without music and light it is impossible to hold any event, which means that there is every chance to earn good money. However, in reality, everything is not so simple.
First of all, you need to understand that professional sound rental, light rental requires a very large initial capital. Even if you purchase a remote control and several active speakers, you will need at least several thousand dollars. At the same time, one must understand that no self-respecting musician in life will play through a Chinese amp or a bad microphone. Prices for quality tube amplifiers are truly astronomical, which is why there are so few random people in this business. Alternatively, you can purchase a set of inexpensive equipment and open a rehearsal base. On such a basis, it is guaranteed that you can earn 300-500 rubles per hour. If the equipment is used at a good level, then earnings can amount to 1000-1200 rubles per hour. Naturally, it must be taken into account that cheap equipment breaks down more easily, and it is very difficult to rebuild its sound at a good level. Expensive equipment does not break down so often, but it requires expensive repairs and maintenance. So, for example, changing tubes in amplifiers will cost a pretty penny. The use of transistor technology is not particularly welcomed by professional musicians. In addition, all kinds of inept “dummies” usually rehearse at the bases, so the risk of breakdowns increases many times over. A drum set requires a particularly frequent repair - replacing plastic and cymbals will cost under 10-20 thousand rubles. It is almost impossible to force a negligent musician to change the plastic. So a person is needed who will rebuild the equipment before the rehearsal and make sure that the drummer does not play with damaged sticks. And if there was a deliberate breakdown - to be able to demand compensation for the damage.
But the rehearsal space is the bottom step of such a business. Professional rental of sound equipment, rental of sound for stage performances will require not only expensive amplifiers, speakers, monitors, switching, but also transport for their transportation. Smart workers will also be needed to connect the equipment, as well as install it according to the stage-plan of the performance. As a rule, good sound engineers and workers require higher wages, while inexperienced ones can burn all the equipment in the first month of work. So labor costs will also take a fairly large part in the total spectrum of expenses. As for incomes, they will not be much at first, since no one will trust a start-up equipment rental company. As an option - to work first with small clubs and impresario, and also try to organize concerts by ourselves.
It is also quite realistic to try to occupy a specific niche in this type of activity. For example, organize street concerts and take money from performing musicians. Or try to promote such a business as lighting equipment rental, lighting rental, specializing in high-quality lighting, offering it not only for concerts, but also for television companies and photo studios. After all, this is really in demand, given that for filming, television people often need to rent several spotlights or spheres for a short time. In a word, the success of such a business depends heavily on the ability to think, intuitively find customers and calculate future income and costs.
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Perhaps you have noticed how many festive events take place in your city every day? New offices, shops, factories, companies are opening. There are weddings and corporate events. Can you imagine a big party or wedding without quality and modern music? This is not so much about live sound, first of all about high-quality sound. Even digital audio is completely different. Sound quality largely depends on the level of musical equipment.
Not everyone can afford to buy expensive musical equipment, to the general joy, today in many cities there are companies that offer rental of musical equipment for various purposes. Their work is aimed at meeting the demand of customers in terms of supplying quality music to events. It must be said that this option of creating your own business is becoming more and more popular.
Who needs musical equipment?
You need to decide who your potential customers are. Local musical groups, groups. After all, they regularly perform at concerts and always need high-quality equipment. Music groups need good sound, but musicians prefer to buy their own sets of guitars, stereo speakers, subwoofers and amplifiers. Buying even expensive equipment fully pays for itself after a while.
Another story is for up-and-coming rock, rap, pop bands, solo artists who can't afford expensive equipment. This is part of the potential clientele. Also, the equipment is necessary for companies wishing to hold corporate parties for their employees. Also, the leaders of new companies with the aim of presenting a new business. Anniversaries and wealthy citizens who want to have fun celebrating their memorable events will become your clients. The list of potential customers is huge. The number of clients directly depends on the range of musical equipment leased. If only expensive music systems are available, then there will be few customers, but with decent pay. If the entrepreneur offers a large selection of both expensive and cheap equipment, then the circle of potential clients expands.
How to open a music equipment rental business?
It must be understood that this business requires solid investments. Here are examples of the cost of popular equipment. A set of two passive speakers JBL AM6215 / 64 for 1000w costs 190 thousand rubles for 1 speaker. A set of Yamaha MSR400 speaker systems costs from 25 thousand rubles. The cost of one amplifier Crown MA 5002 reaches 150 thousand rubles. There can be several such types of equipment in one set. Now I understand the cost of the equipment.
The cost of renting musical equipment
Depending on the set, the cost starts from 3000-5000 rubles per day. This is the cost of a set of acoustics with a power of 1 kW. (1000 watts). Equipment with a capacity of 7-8 kW. costs 14-20 thousand rubles. Equipment with a capacity of 25-30 kW. costs 50-70 thousand rubles.
Calculation of profit from the rental of tools
For example, consider a 6 kW musical equipment. The kit includes 2 subwoofers costing 140 thousand rubles, two passive speakers for 90 thousand rubles, plus two power amplifiers 300 thousand rubles. A complete set costs 550 thousand rubles. The cost of renting a complete set is from 15 thousand rubles. That is, the financial costs will fully pay off after 33 rental orders. For what period of time you pay back the equipment depends on the advertising of your services. Just renting such a set at least 5 times a month, after 6 months of work, you will fully recoup its cost and then get a profit from rent. And the profit is pretty decent. There may be not one but 5, 10, 20 sets of equipment at the disposal.
Whether it is worth starting such a business directly depends on the city where it is planned to open a musical equipment rental office. There are cities where few people celebrate holidays, and there are also those where not a single event can do without high-quality music. For you, it is worth understanding whether this city is suitable for such a business or not.
It can be said for sure that this business option has great opportunities for development. Today, many companies offering equipment for rent supplement the price list for services with the rental of stages, podiums, scenery and lighting equipment. When there is supply, there will be demand. Good luck in creating and promoting your business!
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