(The Recording Contract)
By Shannon MacDonald

At some point in time, every independent band will need a label to take them to the next level. Perhaps you think you are ready?

A label can help you reach the goals that have become unreachable and help with the overall success. Like any successful business that wants to take it to the next level, an injection of cash flow could be the answer. This is the game we play. Like flies to honey, if you are making waves, the record companies will usually find you. The following information can help…

At present, record sales have declined and income from streaming is at an all-time low. Now more than ever Record Industries need far superior ways to secure their investment. One must remember – a contract is not a “gift. It is built upon the “handshake on paper” prospect for making a profit from their investment. Perhaps a better example is to call it “a glorified bank loan”. In the end, it must be paid back… one way or another.

So these questions will need to be answered:
Have you built your fanbase? Your fanbase is an absolute must and can’t be done overnight.
Are they buying your project? You can’t get “there from here” if you are giving away your latest album.
Are they buying your merchandise? One person buys a tee… that is a free advertisement to all that see it and money in your business pocket.
Are you fully booked for live shows? Touring is important. Are you in constant demand?
Is there crowd participation at your shows? Labels absolutely consider physical attendance at your shows.
How is your Streaming Income? Proof of good streaming sales is a head-turner for the labels.
Remember: This is a two-way street and you both have to make money. That is “Good Business 101”.

If you have answered these questions with conviction, are willing to give up a percentage of your earnings, feel this is truly the road to the next level, then it is time to contact an attorney to review the deal.
A contract that is well written with clearly understandable terms is key. Make sure to use an “entertainment attorney” that understands these terms and will fight for you during your negotiations. NEVER use an attorney the label recommends.

Contract terms depend on what is on the bargaining table of the artist and their power. A newbie, with no real history of earnings, will not get “a deal” or the same deal as a seasoned artist with a proven track record of strong earnings.
Terms May Include:

  • Royalty rates
  • The number of songs to be delivered
  • What costs the record company will pay for
  • The amount of money the record company will spend on social media campaigns
  • What type of music production support they can provide
  • What kind of touring package will they provide to help with record/streaming sales
  • Whether the record company will also participate in the money earned from music publishing, merchandising and live performances

We at Saloon Studios Live understand the music industry and the trying times it has been through in 2020. Perhaps this is the time to put your best foot forward and do your research and see where you stand. We hope our assessment evaluation helps you. Remember, we are a full in-house recording and video company as well as a “live” entertainment complex. If you feel you need our help… do not hesitate to call us.