Lessons Learned from the Indies – Lesson #3a – Managing the Business
Over my last several musings we’ve talked about Lessons to be learned from the Indie Artist - including #1 Getting the Gig, and #2 Getting Invited Back. Lesson #3 is the foundation for all of that – that it is great to get gigs and have opportunity, but if you can’t manage the business side of your art, there is a high probability it won’t matter if you get the gig, or get invited back.
There is an old chinese proverb that says ‘ To open a shop is easy, to keep it open is an art’. Following are a few Principles to help artists to begin to focus on the other ‘art-form’ that will help sustain them over the long haul.
1. Make it Your Business - If you want your music to be your career, then make it your career. Too many consider it a pastime, and then wonder why they aren’t able to make a living. One of the first steps is to set up a separate checking account for revenue and expenses for your art. If you make $200 for a gig and then put it in your personal checking account, there is a high probability that it will be spent for groceries, gas, cable, etc. Ultimately, that money may have gone for those things anyway, but its healthy and wise to keep it separate so that at anytime you are able to monitor what revenue (and expenses) have transpired. More on this in the next blog!
2. Save – As a child we learned to save, and as an artist we need to put that into practice. Its one of the most challenging things – often we are barely scraping by and then we have a fruitful month and the tendency is to celebrate and spend! As an artist, if you can get into the practice of putting away for a rainy day you will be freed from some of the stress that comes in the month when the gigs just aren’t there. There will typically be seasons of plenty, but they are generally followed by seasons of scarcity. When you are starting in your career, the scarcity is because its just tough to book; when you are successful, the scarcity is because you want time off. Either way, its smart to have a nest egg for that season.
3. Manage Your Margins - I was talking with an artist at their merch table one night and they were so proud of their new shirt – the design was cool, etc. They were marketing the dog out of this shirt even though the artist told me they only made $3.60 on it - it cost them over $8 and they were selling it for $12 - “but its so cool!” HUH?? I later asked them what they paid for their Cds that they had manufactured themselves that they were selling - $1.27 – which were being sold for $15. So they were pushing merch where they made $3.60 verses a merch piece where their profit margin was over $13. Enough said.
4. Put Your Money in the Bank - This sounds silly at first, and yet I have seen so many artists who were on tour and were carrying around thousands of dollars of cash. “They just hadn’t made it to the bank yet”. Make it to the bank! Join a bank that has multiple branches – or at the very least find any bank and turn your money (which you made by selling the merch with the greatest margin) into a cashiers check and/or money order. So much can happen when money is just laying around, but the greater issue is to be planning for the days ahead, and when its sitting in a cash box in the van – its just a lot easier to spend at In& Out Burger or better yet, Guitar Center.
I’ll have 4 more principles in my next entry – now go get busy!!