Getting a business up and running is expensive and hard work.  Some of the step-by-step guides trick you into thinking it could be a piece of cake; but the reality is that each little step has around 100 sub-steps, and each one of those little sub-steps has another hundred of it’s own.

 

Today I received the boxes for packaging my first product and it took me 15 minutes to put one box together.  I’m sure I’ll get faster at it (I’d better!J), but still, there are things I’ll have to do by hand, and without much profit to be made, until I’m ready to order in quantity.  I don’t have the thousands of dollars right now to risk investing in inventory that might sit around for who knows how long.

 

Also, I already have an entire closet full of boxes of brand new, shrink-wrapped CDs.

I’ve been in the music industry for many years, both as an artist, and as an “executive” (in the loosest sense of the word!).  For about 13 years,  I’ve been the “president” of a recording label owned by me & my soon-to-be-ex husband.

When we formed our label in 1994, we were both artists/musicians, not business people.  We were both totally into the music, without a clue as to, what do you do after you produce a great album?  What’s marketing?

    

In the mid-90s, there were more and more business books coming on the market on how to do almost everything.  It was around the beginning of the music industry’s big “do-it-yourself” revolution.

 

I took on the role of President of our record label, because 1) my husband was the one who was spending the most hours in the studio doing the recording work, and 2) it was a good business climate at the time for a woman-owned business, with some new unique business and networking opportunities, of which I was the better at of the two of us anyway.

 

As President;  I ended up becoming the one responsible for all the day-to-day financial and business-running decisions of our company.  Clueless and in charge.  A powerful combination.

 

I put on a good front and did the best I could.  The product itself was awesome, but neither of us knew a thing about running a business.  I believe even Frank Sinatra or the Beatles wouldn’t’ve had a chance in our hands.

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Regarding the new business I’m getting ready to start, I’ve  been taking a lot of classes and seeking as much help as I can, to do it right this time. 

 

With my new business, my recent first product decision has been whether to 1) spend thousands of dollars to buy in quantity at a low cost (and then run the risk of having the new product join the CD party in my closet), or 2) pay 3-5x as much for limited inventory and materials, and then, when I can see the product becoming profitable, order in quantity at substantial quantity discounts.

 

I chose #2 this time, with very little initial profit and long days ahead of me as box assembler.

 

BUT, I’m ok with that.  Take it slow.  See how it goes.

 

Someone said to me – wouldn’t it be fantastic if as soon as you put your product on the market, you get orders for thousands!   

 

Well, yes and no.  I would have to work really fast to get those orders out, but it could be done.  But then, what about if I do get an order for 1000 right away, and quickly order thousands more, and then find out it was a fluke?

 

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See, that’s what’s happened in the past with CD sales.  A couple of times, some of our titles got off to a great start – quickly almost selling out of the initial order.  Then I would get excited and put in a new order before the first one ran out.

 

On one of our titles, which we released 10 years ago, there are still 50 left from the first run, and then the entire new batch.  We came so close to being sold out of the original order, quickly reordered, and then never even touched the second.

 

We made so many bad business decisions.  It’s almost funny, but it’s not.

 

In 1995, we released a hit children’s album.  It was played all over the world and sold slowly, but steadily, through independent sales and music websites.

 

First major Clueless Move  

We live close to one coast.  We had family on the other coast, and did some performing out there, and the album began to take off.  We ended up becoming very popular on the other coast, (not the one close to us!), championed by the children’s store, Zany Brainy, who at that time was very into promoting children’s music and musicians in their stores.

 

The musicians who performed at the Zany Brainy store openings didn’t get paid.  In fact, we had to provide our own flights to the gigs.  But the promotional opportunities were priceless.  The top children’s artists of the day were performing at those store openings and now we were being invited to move into this circuit.

 

But we had had no money available for marketing, tour support, etc.   Too broke to capitalize on what that time was the primo marketing opportunity for a children’s artist.

 

Clueless Move Number 2 

The largest distributor of kids’ music offered to place our CD in stores throughout the country.  Rather than being “savvy and astute”, we became “flattered and floating on Cloud 9”. We took out loans to manufacture and ship thousands of CDs out to the distributor, and for several months were celebrities to our friends and families.

 

No one ever told us about market shifts.  Store closings.  Returns.

 

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Over these past 10 years I’ve developed a greater compassion and understanding for business owners.

 

Being in the music business, a very annoying thing music loving non-record label owners used to like to say was:  “The record companies are robbing the people!  Charging $15 for a CD!  Everyone knows CDs only cost $1 to make!!!!”

 

Yeah sure.  What about the photos & artwork?  What about the cost of the musicians?  What about the production and studio costs?  What about tour support and radio support so you even know this music exists?  What about the risk the company takes in printing up large quantities of CDs that may never even sell (i.e. – see “closet” above)?

 

Everytime I hear that I just want to punch someone.

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I love music and no doubt will continue to be a fool for the art and take on the disproportionate expense of putting out my best work possible.  But financially speaking, I have yet to break even.

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Which brings me back to my respect for business and business people, and this new business I’m taking on.  I have learned a lot by doing everything wrong.  With my new business venture, I’m making the choice this time to wade in through the baby pool, one step at a time.

 

I hope it does really well.  But not too fast.