Mt. Hood Records is a unique but sustainable record label business model. Hillary MacQuilliams established the company as an Oregon registered LLC. The business operates to promote several Portland based bands, all with the common element of improvisation.
Analyse Industry
A few large corporations are the dominant players in the retail record market. These corporations control 87% the CD sales. Indie record label, which is a less commercial version than the big corporations, controls 8%. The remaining five percent are controlled by a combination of several record labels. Most labels follow a shotgun approach for sales. They sign up a lot of bands and hope one or two make it big. The record companies can make huge profits on bands that become commercially successful. Although the Indie labels have a similar structure, they are more selective and don’t always choose the most commercially viable artists.
Products and Services
Mt. Hood Records is a Portland-based record company that represents a select group Portland-based artists. Mt. Hood Records has adopted the business philosophy that for long term sustainable growth it will be more successful for the label to sign up just a few bands and promote them equally than to sign up a bunch and hope one is a commercial success, enough to float the rest of the bands. This approach is very appealing to some bands. This allows the band to have a more personal and focused label. The label is working hard to promote only a few artists, so the bands are conscious of this fact.
A Business Model
The first year of this record label’s success will require a lot sweat equity. This can be quite hard for many businesses to accept. Mt. Hood Records it helps that these realistic expectations have been established up front, and will not be an unwelcome future surprise. Additionally, the investors (friends and family) are aware of these parameters and have given their blessing. This will require a lot of effort, but it is possible with reasonable expectations and the right management to execute the business model.
Management
Mt. Hood Records has been founded and will be run by Hillary MacQuilliams. Hillary is an experienced musician. Hillary began touring with her band 180 South right after graduation. To support this month-long regional tour, Hillary and the band started their own record label to release a studio CD for themselves. Hillary knows that this was not an attempt to make a record company work. It was more of an experiment to start a label and release their own CD.
Hillary enrolled at law school after the band split up. After graduation, it was extremely difficult to find law jobs. Hillary became frustrated with the lack of success in her job searches and decided to try her luck in the music business because of her passion. She did extensive research to develop a sustainable business model by creating an exclusive local record label. Mt. Hood Records.
1.1 Objectives
- Within three years to become the leading local music label.
- Sign up for at least five clubs within the first 3 years.
- Within three years, you can achieve profitability
1.2 Mission
Mt. Hood Records is a locally-based record label. Its mission is to promote local musicians, increase live appearances, record sales, and create awareness for them. Mt. Hood Records has been established to promote its bands and at the same time make a fair profit.
1.3 Keys to Success
- Choose promising bands to promote.
- Avoid signing up too many bands. This will reduce the effectiveness of promotional efforts.
- Enjoy working hard, but have fun.
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