Music Business Plan

As an A&R Consultant with Lisa Davis Music Management, I have been able to take a lot of the material that I have learned over the past year during my program and share it with the Independent Producers and Artists that I have the opportunity to work with on a daily basis. Often when I speak with these artists they have no plan in place as to how they are going to market their music, or a budget to record, mix and package their music. This proves just how important a business plan can be no matter what field.

Well what is a business plan, what is it used for and what necessary components are needed for a successful business plan? With the help of eleetmusic.com and musicthinktank.com, I have put together the essentials any music entrepreneur (artist, producer, etc) will need to put together their business plan.

A business plan is an essential roadmap for business success. A business plan is used to: 1) Acquire funding from a financial institution or private investor or 2) How you will run your business on a daily, monthly and yearly basis.

The Elements of a good plan are:

Executive Summary:
This is summary of who you are, what you sell and what you want.


Products and Services:
Okay, so it seem obvious that you're an artist and product is your music, but there are so many other sources of income for artists today through ringtones, merchandise, songwriting etc, be sure you explore those other sources of income.

Marketing Plan:
"I am going to push my music on the internet and the streets", this often how many artists tell me how they plan on getting their music out. That is not a marketing plan, I believe the marketing section should cover who, what, where, when and how.

Management Plan:
Your team is only as strong as its weakest link. You may not have a manager, attorney or business manager, but for the people that are apart of your team, this where you would explain in detail everyone's roles and responsibilities.


Financial Plan:
This is a key component if you are looking for an investor or even family to invest in your project. How many albums or merchandise need to be sold to cover the costs of creating the project? How will you be able to pay back your investors and turn profit? These are things to be covered in the Financial Plan of your business plan.

This is just an overview of the components needed to write a music business plan. You can download a template here.

Business Plan Experts

A business plan should tell a compelling story about your business, explaining who, what, when, where, how and why. The plan should define specific business objectives and goals to guide the organization. These two successful entrepreneurs understood the importance of a business plan and what key components of a business plan made their business successful.

While working full-time at Red Lobster, Daymond John launched FUBU (For Us, By Us), a clothing line marketed to the African-American community, in 1994 with $100,000 in startup capital. At the height of the company in 1998, the business grossed $350 million in revenues.

 John now a cast member of the ABC show, Shark Tank, he listens to entrepreneurial hopefuls are looking for an investor to invest their personal money into their business ideas.  In exchange, the Sharks are not only looking for a return on their investment, but also own a piece of the next big business idea.

In an interview with blogger Tim Ferriss, John says that he makes the deciding factor in investing in an particular product by asking himself a few questions. He focuses on:

            -What void in the marketplace does this product fill?

            -Who are the core consumers? Has the company correctly marketed to them?

            -What are the sales?

            -What are the distribution channels?

            -How much does this entrepreneur know about his own industry?

            -Is the business on an upswing? Or has it peaked?

            -Is their room for profit and growth?

            -What is the plan for growth? Is it laid out or simply another idea in the entrepreneur’s head?

            -Is the evaluation of the company fair?

            -How can I best help this company?

He continues with that the entrepreneur should always be ready for these questions and he/she doesn’t have a quick response to these questions, there is a problem. 

“With a business plan, there is direction and focus. If there is no business plan, then there is no focus for your business and you are bound to fail. With a plan, you know where you are going, what you are doing, and how you will get where you want to be,” says real-estate tycoon Donald Trump.

Chairman and President of the Trump Organization and the founder of Trump Entertainment Resorts, Trump has succeeded in marketing and branding the Trump name on a number of products ranging from a mortgage firm, business education company, restaurants, online travel, menswear and more.

In 2004, The Donald became Executive Producer and host of the NBC reality show, The Apprentice, where competitors duke it out for high level management position within The Trump Organization.