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6 Business Rules Indie Artists Need To Follow To Make A Profit

So you've decided to be an independent artist! congratulations on starting up your small business!. It is essential to have the right mindset straight off the bat. Artists are generally very creative people so when it comes to the business side of music, we often sweep that under the carpet and, by doing so, we significantly reduce the chances of making a profit much less a sustainable living income. 

To be successful in the music industry, you must conduct your music dealings as a business, meaning that you will have to split your time between being creative and becoming business savvy. 

There are many benefits to being self-employed, aside from getting to be your own boss, there are many financial benefits, especially at tax time, which is why you need to be organised and structure your career as a business. Unfortunately, a lot of artists, including myself, think they can depend on just releasing their art. We don't often consider timelines, planning, expenses, income, income tax and the plethora of business rules that need to be followed to establish and run a small business. 

Starting out as an indie artist myself, I just wanted to make music and at no point (until my accountant sat down and gave me a firm talking to me because I presented him with six years worth of tax) did I even consider that I was actually running a business. In the eyes of the law and the government, I had responsibilities that went beyond figuring out what picture I was going to put on my new album cover. 

Here are 6 Business rules you will need to follow to make a profit as an indie artist. 

1. Start with a business plan. I have started three businesses, and every time, I have completed a business plan. Your business plan must include a mission statement, your short term goals, long term goals, a workable budget and overall goals and objectives. This plan will be there to follow, refer to and keep you on track while you work at achieving your goals. 

2. Start small. I know, it's an exciting prospect to have your own album out, along with a great video, epic photography, a slick website and the coolest merchandise, but! There are some things you need to consider first. When you are a new artist you won't have a following, or at least it will be minimal, so we don't want to waste money or even worse, borrow money for large projects when you haven't built the clientele to purchase our products. So I say start small, test the waters. Do what you can on a small budget, one that you have already planned out in your business plan. 

Start with releasing a single, create a website for yourself on a site like Wix or WordPress, these can be done relatively easy. Consider the things that need your budget, the quality of your recording and the quality of your promotional shots. 

With things like merchandise, look at items that can be purchased in large quality for a reasonable price that can be sold at your gigs for a reasonable markup, i.e. posters, these are inexpensive, popular and you can make a good profit on them.

The aim is to build your business and brand, as your brand starts to grow and gain a following, you can assess your current business financials and look at preparing for your next project. Remember you need an audience to sell to. 

3. Maintain professionalism.  Have you heard of the saying "the customer is always right" well, this is no different! Whoever you have dealings with it I that you are professional and courteous, nobody wants to work with a jerk! If you never answer emails, you're always complaining, talking about others behind their back, not paying your bills and you don't turn up for gigs, then you will be labelled as unprofessional. Word will travel swiftly, and work will begin to dry up, hence ruining any chance you have of making a profit from your business. 

You must always approach every situation, remembering that you are representing your business, you are your brand, and if you mistreat it, it will come back on your boss, and who is your boss? YOU!, treat each meeting as if you need it to put food on your table, be grateful for the work you do get because it is what allows you to do what you love. 

4. Keep records of everything. The hardest lesson I have learnt would have to be the tax implications of running a small business. Organise a meeting with your accountant, if you don't have one, then get one and organise a meeting with them, they can help you set your business up legally and then they can tell you what you will need to keep records of and the best way to keep those records organised. 

Music can be a very costly career, so you most definitely want to claim all of the self-employed benefits your government allows you to. Keep records of everything you spend and everything you bring in. If possible, work with an accountant that is experienced in handling accounts of musicians as they are more likely to know your obligations and entitlements. 

5. Be innovative. When you are in business, you need to be competitive, and you need to be innovative. There are a lot of people doing what you do, a lot of artists trying to make a living in the music industry and just as with any industry; you need to stand out! 

Create new ways of doing things, new ways of promoting yourself, different kinds of competitions, ways to have people sign up to your mailing list, fresh, creative ways to get them to gigs or to buy your merchandise. Your audience has most likely seen it all, and when everyone promotes the same old way, things get stale ad boring, so if you are creative and innovative and provide your audiences with something new, then chances are you will win them over, as they say, "the early bird gets the worm".

6. Be consistent. Creating a profit from your small business isn't a walk in the park for most, but all of the successful artists have one thing in common, they are consistent! They are always there in front of their audience, and you need to be the same. There is no point in starting up your business if you are not totally 100% committed to it, meaning that you are consistent in every aspect. Your audience will get used to hearing from you, but as soon as they don't, they will forget you, so staying in front of your audience consistently is absolutely necessary for growth in your business. 

Imagine if McDonald's were open one week and then decided to close down for two days the following week, then open three days the next, the lack of consistency would turn customers away. We know how it feels right now as most of our businesses are unable to open due to COVID-19, I certainly don't like the feeling of knowing that my favourite restaurant isn't open for business. You need to be there, on their radar, consistently.

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