what is the formula that definse profit?
revanue – expenses = profit
what question does a mission statement answer?
the reason why you are in business.
what is a vision statement?
what your view is of where the industry is headed and where you will take your business.
what is a values statement?
it is a code of ethics or opperating principals.
what are the two stategic questions to consider before going into business?
what do i want to acomplish?
what am i willing to risk
what are three key elemets in any music busines
what the businees or product is

what your product market is

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what is the revanue streem(how do people get paid)

what 3 things should you do before going into business
market overview

phesability(risk analasys)

business plan

in what types of entities are businesses organized for tax and legal purposes
sole propitership




what are the four major record lables




who is the customer in the music business
whoever pays you directly
define the two kinds of competition
direct- similar businesses in the same product catagory

indirect- any product the goes after the same customers as your product.

what are 5 key aspects of business?
producty develpoment

product delivery

sales and marketing

accounting and finnance


whatr are the four key responsabilities of management?
what 3 conditions must be met before starting your own business?
business plan


comfortable taking risks

what are 8 benefits of writting down your own business plan?
road map compettative weapon

measuring stick fund-raising tool

opportunity management tool team building tool

stress management tool

catalyst for your best work

who can also benefit from a business plan?
everyone involved
what are 3 things that a business plan describes?
what your going to do

how your going to do it

the risks involved

what are the 5 chapters of a business plan?
description of company

description of products

market & overview strategy

management team & organization overview

financial summary

what section is the largest portion of the business plan and carries the most weight with financial people and investors?
how long and detailed is a business plan?
15-20 pages
what is the plans 6th chapter and what does it include?
appendix or refference section
what 4 key questions does a brand possitioning statement answere?
what business you are in

what makes you special

who are your customers

what is in it for everyone involved

what is the elevator test and what is it used for?
25 words or less to sell yourself to someone…

ued for networkiing

what is the biggest challenge facing any music person or music business?
define marketing
developing products and exposing them for sale to a specific customer..
define : sales
expoditing the products for a certain price or price range
what are the four functions of marketing?
managing customer relationships
communicating with the target market
advertising and presentation
what are the seven links in the marketing chain?
product stratagy

pricing strategy

promotional strategy

sales channel

sales force

user and or audiance profiles

competative environment

what are some examples of music industry products
live performance…….
what are the six phases of product life cycles
1-research and developement
3-early growth
4-late growth and shake out
5-maturity and saturation
what are the three key factors that influence pricing?
supply and demand

pricing conventions and traditons

sales and marketing abillity

what are the three basic prcing statagies ?
low cost product strategy

defferntation strategy

hybrid strategy

what typically happens in the music industry with unrealistic pricing?
they wont get any work
define : branding
creation of indellible images of you and your products in the minds of your target audiance , customers, and stock holders.
what are ten types of promotional tools ?
sales literature
demo recording
direct marketing
trade events
key influence relations
identity items
collateral materials
what are three key questions about your promotional strategy?
what can i afford
do i have to use all ten categories
what if im not good at promotional strategy
who are the four main players in maximising a music career?
business manager
how many songs should be included on a demo c.d.
why is it important to have your best song first?
catch their attention
who is the first person on the artist team
why should an artist be cautios about getting a lawyer to shop a c.d.?

they wont really shop your c.d. unless they think that it will be lucrative..

what sugestions does passman to screen the sharks?
get refferences
consult team
look beyond sales pitch
who will do the work
to what two possitions in a corporation ca you compare the role of a personal maneger?

personal mngr

what are the 7 items listed as major aspects of a managers job?
helps with business decisions
creative process
promotion and publicity
assemble management team
coordinates with agent
liason with the record label
buffer for outside world
what is the typical range of commisions that a mngr earns ?
what is the typical terms of a mangement agreement?
3-5 years with options
what is an album cycle?
time of commencement of recording to end of promotional responsabilities.


what is a sunset clause?
limits mngs income after termination
commision “step down” over time
what is a key man clause?
if the person you hired retires , dies , or is fired/quit, you can legally terminate the contract.
what is the role of a business manager?
acountant and takes care of the financiaql needs of the artist
what credentials or licenses are required for a oerson to be a business manager?
why is it rishy to have a family member as your business manager?
if something goes wrong you dont want to kill your brother or dad…you dant want a ruined family relationships.
how are business managers custmarily paid?
monthly retainer
percent or combination
what is value billing?
spending time negotiating deals- percent of deal basis
what is a retainer?
advanced payment , fees deducted
guaranteed amount every month
what are a clintes options if an atorny reveals a conflict of interest?
hire another atorney
waive conflict
what is the role of an agent ?
finds work for the artist
what unions may regulate agents
what does franchising mean?
working for a union and abiding by their rules.
what is the standard fee for an agent
10 percent
if an artist doesnt have a mngr , who does the agent report to
the artist
what does a distributor due
gets the product out to the stores.
what does a&r stand for and what do they do…
artist and repitoire – theyu find the talent and bring them to the lables .
what does the promotions departement do?
gets the artists songs played on the radio stations
what are the four major record destributors
sony bmg
what is a true independant distributor?
independant distributors deal with indipendant lables they handle a large number of small lables..
what does the term record include?
any kind of delivery of music for consumer use..
what are the two meanings of master?
orriginal recording made in the studio.. recording of one particular song…
record companies compute artists royalties based on what

% of wholesale price

multiply %of royalty times wholesale price 

what are free  goods
free goods are given at  a discounted rate and are not used to pay royalties to artist
can retailers return unsold records to the record company
what is a reserve against returns
portion of royalties witheld to cover returns
what does liquidating the reserve mean
within 2 years of shipment royalties are paid to the artist as a reflection of the reserve
what is recoupment
taking royalties recieved and supplying it to the amount advanced to the artist