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Do you want to create your own record label?

Do you wish to start a music production firm of your own? A music production or record label company is a trademark or brand associated with music videos and records. A record label company is in charge of the production, manufacture, marketing, distribution, promotion, and copyright enforcement of recordings, as well as the development of new artists and talent scouting.

Because almost everyone enjoys music, the music industry is one of the most thriving and profitable industries. However, starting a business in this industry isn’t easy, and there are a number of variables to consider and resolve before embarking on this journey. This business plan for R&N Entertainment, a record label startup, may be useful if you’re not sure how to start your own record company.

Create a clear business plan for your new enterprise as the first stage. Professional business planning may aid you in acquiring a business license as well as making key first decisions. It will help you define your services, identify your target market, build sales and marketing methods, and create a personnel and financial plan. Most importantly, if you need investors for your company, it will aid you in locating them.

The Company

R&N Entertainment will be a worldwide record label responsible for the production, manufacture, marketing, distribution, promotion, and copyright enforcement of music recordings.


R&N Entertainment was created by Randy Hilsly and Nash Jonson as a joint venture in which both partners have an equal share of investment, ownership, control, and benefits and risks. Both Randy and Nash have worked for Warner Music Group, one of the Big Three record labels. Because of their extensive experience, the owners know how to write a business plan for a record label and how to start a music production company.


Record labels have found it considerably easier to extend their business and reach a bigger audience since the internet’s debut. Our customers will come from a variety of backgrounds, geographies, beliefs, and colors, and we will be reaching out to people all over the globe.

Owner of a business

R&N Entertainment was created by Randy Hilsly and Nash Jonson as a joint venture in which both partners have an equal share of investment, ownership, control, and benefits and risks. Both Randy and Nash have worked for Warner Music Group, one of the Big Three record labels.

Why is the company being established?

The proprietors of R&N Entertainment have a same goal: to return the music industry to its previous splendor. For a multitude of factors, the quality of music is declining day by day. R&N Entertainment will ensure that the future generation gets access to the most popular music as well as a taste of current classical music. The creators have established a fantastic record label business model that is geared to grow and beat the competition with this shared purpose in mind.

How will the company get started?

R&N Entertainment will open its doors in a leased location that was formerly a restaurant in Houston. To convert the facility into a recording studio, it will need major modifications, for which the organization will hire a contractor. In addition to the usual merchandise, professional headphones, microphones, track recorders, mixing consoles, reference monitors, keyboards, a music workstation, audio editing software, computers, and other equipment will be acquired. Financial experts have calculated the following costs to start a music production company:

Customers’ services

Before you consider how to establish your own music production company, you must first choose what services you will give to the singers and musicians with whom you will collaborate. In order to secure sales and provide value to your business, you must also consider the kind of music you will deliver to your audience. This will also help you figure out your company’s record label business structure, which is why you should look into it before setting up your own studio.

The company’s services are categorized into the following areas in terms of income generation:

Record Store Distribution: The company will distribute its albums and records to a wide range of music retailers throughout the country. It will account for the bulk of our earnings after the money received through internet purchases.

Internet Record Sales: The company will use digital channels and internet platforms to sell records and albums on a large scale. Because consumer preferences are altering and most customers prefer to purchase online rather than in shops, the company’s primary source of revenue will be online record sales.

Concerts and Events: The company will also host concerts and events starring the singers and bands who have been engaged. The live concerts are being held for two reasons: brand exposure and income generation.

Contract buy-outs: It’s usual in the music industry for bigger businesses to buy out smaller companies’ contracts with young and promising performers. This contract buy-out offers smaller and newer labels with a considerable sum of money rapidly.

Analysis of the music studio industry’s marketing

An accurate marketing study is the most important component of a successful record label business plan, and it is only after this stage that a solid music studio business plan can be created. If you’re starting off small, you may use this template record label business plan or other sample record label business plans online to do your own marketing study. If you’re starting on a larger scale, it’s typically best to seek the help of marketing experts when creating a successful recording studio business plan. The success or failure of a business is totally reliant on its marketing strategy, which can only be developed after extensive market research. As a consequence, it must be addressed while developing a record label’s business plan.

For their music label business plan, R&N Entertainment employed marketing consultants to conduct a marketing research. The creators researched several recording studio business plans available online before creating their own music production business plan.

Market Developments

To grasp the industry trends in this sector, you will need to do significant research. You may use this record label business plan template or look for more record label business plans on the internet. This free record label business plan template may help you gather all of the information you’ll need to start a record label, including industry and market trends. The record label industry is older, but it became increasingly popular in the 1990s when independent tables, home studios, and consumer recording technology were more widely accessible. The global revenue of the music business started to drop in 2002 due to a multitude of factors, the most important of which was the changing tides in technology, which enabled artists to release their recordings directly on the internet without the need for record labels. The industry continued to deteriorate until 2013, when it was valued at $15 billion, the lowest revenue since 2002.

However, it resumed its expansion, increasing by 8.1 percent till 2017, bringing its value to $17.3 billion. This rebirth was the result of record companies continuing to spend not just in performers, but also in digital innovation that improved fan experiences and made use of technology like voice-controlled home speakers and other similar devices. As digitization has developed, fans’ engagement in streaming, especially paid subscription audio streaming, has increased. As a result, digital sales accounted for more than half of all revenue generated by the global recording industry (54 percent). By the end of 2017, 176 million users were anticipated to be paying subscribers, with 64 million more expected to join during the same year. Despite this, the industry’s total earnings were only 68.4% of what they were in 1999. These data show the challenges that this industry has faced as a consequence of increased digitalization; nonetheless, if handled correctly, digitalization may be a useful tool for record labels. To summarize, a record label firm can only succeed if it prioritizes having a strong online presence.

Segmentation of the Market

Once you’ve figured out the industry and market trends, you need figure out who your target market is and how they’re divided into client groups. The creation of effective marketing methods is aided by target market segmentation, which is vital for the music production company business strategy. Because a record label’s target market is generally made up of people from all over the globe, marketing segmentation is fairly standard across the board. As a consequence, this record label business plan sample, as well as other free record label business plan examples available online, may be able to assist you in determining your target market segmentation. This portion of your music production studio business plan must be given substantial consideration since an effective and efficient marketing strategy can only be established if you have a clear grasp of your target clientele. Previously, when the internet was not as widely used as it is now, record labels relied only on record retail sales, and their target market was very limited. However, with the advent of the internet, record labels can now easily extend their operations and reach a larger audience. As a consequence, even if a record label is based in the United States, its target market is global. Thanks to the internet, record labels may now reach a global audience.

R&N Entertainment will also target a global audience, with our specialists recommending the following categories:

Customers on the Internet:

Our initial and most important set of customers will be those who will be digitally linked to us. We aim to reach a global audience, which can only be possible if we maintain a strong online presence across all platforms, including the corporate website, social networking sites, the official app, and online retailers like Amazon and Alibaba. Our digital customers may access our data in a number of ways. The music files of the performers may be downloaded for free or for a fee using PayPal or another online payment system. Internet retailers also sell physical copy CDs in addition to direct downloads. Digital sales accounted for more than half (54%) of all money made by international record sales in 2017, therefore this is where we’ll focus our efforts. We’ll create a one-of-a-kind business strategy for reaching out to our worldwide digital audience.

Customers in the retail sector:

Our second target group consists of customers who will acquire our recordings at retail outlets throughout the United States. We plan to release our recordings only in hard copy in the United States at first, but by the end of the second year, we want to have created a European distribution network. Because almost every child and adult in the United States like music, this customer group will make a lot of money.

The third target category is the audience or clientele who will attend our live events and performances. We plan to host regular performances in all of the country’s major cities. In addition to producing income, we aim to use these performances to promote our artists and our brand. Although these live events will not directly create a significant amount of revenue, they will indirectly through promoting us.

Business Objective

The music industry’s businesses are working hard to fuel the industry’s recent revival while simultaneously ensuring that artists are adequately paid for their labor after a 15-year period of revenue loss. Our major business objectives to achieve as milestones over the next three years are as follows:

To become Houston’s leading record label during the first three years of business by providing high-quality services.

We expect a net profit margin of $10k per month at the end of the first year, $15k per month by the end of the second year, and $25k per month by the end of the third year.

The startup’s initial expenses should be matched with generated revenues by the end of the second year.

Enhance the retail distribution system and target the European market by the end of the second year.

These business objectives are well within reach, and they can be achieved by offering fans with engaging ways to consume music across a variety of services and platforms.

Pricing of Products

This sample business plan for a record company might also help you figure out how to price your label’s products. After analyzing market demands, we priced our services in the same ranges as our competitors. This pricing strategy was carefully studied in light of a variety of factors, including the competition provided by established record labels, notably in the United States’ Big Three.


Once you’ve discovered market demand, market trends, and potential consumers for your firm, you’ll need to devise a strategy for attracting them to you. Sales strategy, like marketing analysis, is an important part of a successful dental business plan, and it must be properly developed before thinking about how to design a record label business plan.

Analysis of Competitors

The record label industry is one of the most competitive in the United States, and a startup’s survival is almost difficult unless it has a clear competitive edge over its competitors. As a consequence, before building your own recording studio, you should consider it. Our extraordinary artists, who will be found via excellent talent sourcing processes, will be our primary competitive advantage. We’ll also try to tempt well-known bands by negotiating “360” deals with them, in which we’ll gain rights and a share of their tours, merchandising, and endorsements. In exchange for these rights and to assure the greatest retention of exceptional artists, we will pay larger percentages of CD sales, have greater tolerance with artist development, and give higher advance payments to artists.

Strategy for Selling

After performing a comprehensive analysis, our experts came up with the following outstanding tips for promoting and selling ourselves.

We’ll maintain a strong online presence across all platforms, including the firm’s website, social media accounts, the official app, and online retailers like as Amazon and Alibaba.

Advertisements will be placed in publications, newspapers, television stations, and social media.

For the first three months of our existence, we will offer free concerts to promote ourselves.

Sponsor programs on television and radio that are related to your industry.

Place ads in both print and online publications.

Personnel strategy

Preparing a personnel strategy is also an important component of beginning a music production company, so think about it before determining how to get started. The following is our company’s personnel strategy.

Employees of the company

Randy will be the General Manager, while Nash will be the Chief Financial Officer. Furthermore, the business will initially hire the following people:

  • Accountants are in charge of maintaining financial and other records.
  • Marketing and new business growth are handled by five sales executives.
  • For recording musicians’ recordings, there are five recording artists to choose from.
  • 10 Technical Assistants to help with the project’s technical components.
  • 4 helpers to assist with various tasks on a daily basis.
  • 4 The company’s social media accounts are managed by a Social Media Assistant.
  • Four SEO/SEM specialists are required for a strong online presence across all platforms.
  • Clients will be dealt with by two Customer Service Representatives.
  • 4 editors for editing audio and video recordings
  • The recordings will be delivered to retail outlets around the country by ten drivers/distributors.
  • 3 cleaning items for a hygienic environment

After completing a series of examinations, all employees will be hired and trained before being onboarded.

Plan your finances

In addition to the other strategies, you must develop a comprehensive financial strategy that addresses all financial aspects of your firm. As a starting point, you might look at this sample record label business plan. The financial plan should include the startup costs, inventory, payroll, equipment, rent, and utilities, as well as how these expenditures will be paid by revenues earned. Also, complete a comprehensive profit and loss analysis before you start thinking about how to start your own music production company. Our financial plan outlines the company’s development over the next three years and is tailored to the company’s short- and long-term objectives.