Setting Up In-House Retail Sales
Now, that you are familiar and likely connected with online
music sales sites, such as CD Baby, or combination
online/offline retail sites, such as The Orchard, you are
probably comfortable in having your music distribution and sales
fairly covered.
But, what if you could get even more music sales, and even more
profitable income?
I'm speaking of consigning your product to retail stores, but,
with one exception...consigning your product nationally, or even
internationally.
For all concerned, "consignment" means placing your music in
retail stores on a trial basis, then collecting payments when it
sells, with the retailer keeping a portion of your sale.
You see, as consignment goes, most musicians who consign their
music to retailers, usually limit their consignment territory to
only local retailers, or on a regional level at most. Their
reasoning is that any larger area will be too difficult to
manage.
But, that is simply not so, and they are losing a fantastic
amount of money by limiting themselves to their local regions.
So, I am going to show you how you can easily consign your
music to retailers and be able to collect payments for sales
every thirty days (or so) via a "step-by-step" process.
It is important to note that the consignment process will be
most successful if you are already receiving some degree of
promotion and publicity results, such as radio airplay, press
coverage, video airplay or through your music being played in
nightclubs via record pools, of which I have addressed in a
previous article.
Otherwise, you may find your ability to move your product from
retailers' shelves almost as difficult as if you did not have
product on them. And, if you do not have some degree of
promotion or publicity, whether you have hired such a service,
or you choose to conduct it yourself, practically, the only way
that you will experience sales is purely by retail customers'
accidental discoveries of your music.
So, ready?
1. Concentrating on retailers (both major chains and
independents) in areas where you are getting radio airplay,
video airplay, press coverage or any other form of promotion or
publicity, contact retailers in these areas who your
distributors may not service. One of the best up-to-date online
sources to use, particularly, for the U. S. is
http://www.yellow.com
This is the online version of the Yellow Pages, and you should
look in such categories as "Compact Discs," "Compact Disc
Retailers," "Music Retailers" or similar categories.
2. You may prefer to visit local retailers in person, introduce
yourself and make them a consignment offer, such as the amount
that you will need from each unit sale, etc., and how often you
will need to collect payment for any sales (usually every thirty
days is the normal time frame). Retailers will also expect you
to make a written agreement available to them that spells out
the terms of the consignment.
3. As for retailers outside of your local area where you are
already getting promotion or publicity, you can simply contact
them via telephone and relay the same information that you do
with local retailers in person.
In both cases, you should direct them to your website, whereby
hopefully, you have your music streaming for them to listen, as
well as have a bio and other important information regarding you
and your project.
You are also free to utilize the retail consignment form that I
have already created, and which you can download, customize with
your own information, then upload to your own website, that is
freely available at http://www.MuBiz.com/CnsnmtFrm.html
4. Once you have uploaded your customized version to your
website, your retail accounts can then simply download it from
your site, or you can fax a copy to them if they prefer.
You will also note that I have included discounts for retailers
within this 1-page form that are designed to dramatically reduce
the number of returns that are a commonality with
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retail
consignment and distribution. The less returns, the more money
you make (and keep).
Additionally, you will see where I have limited the number of
units to five (5) at any given time. This is to ensure that
there are just enough copies that should sell with no problem
within a 30-day period, especially, if you already have
promotion and publicity occurring in the retailer's area. This
limit also ensures that you have enough product to reasonably
service enough retailers.
Also, with this limit, re-orders are more likely to occur
before the end of your 30-day periods. This type of retail
activity looks really great to traditional distributors who,
after seeing your product's retail track record, may contact you
to inquire about carrying your product. This will give you
stronger bargaining power with them, as well as wider
distribution, than if you did not have retail product available
and moving.
And, even if distributors do not call, this will allow you to
approach them with an attractive sales history and track record.
Also, be sure to provide local retailers with two copies of the
consignment form to sign (carbon paper between two original
copies still works) so that both you and the retailer have
copies.
5. As for retailers outside your area, or local retailers that
prefer to use the online consignment form, be sure that they
download, sign and either fax or mail the form to you *BEFORE*
you send them product. This creates an initial record and
verification of a purchase request. You then, in turn, sign the
form then return a copy to the retailer along with his order.
6. When sending retailers product, be sure to *ALWAYS* send
your product via some shipping/tracking method. I would,
personally, use the Certified/Return receipt service with the U.
S. postal service, and I believe that the U. S. postal service
also now has tracking for 2nd Day Air/Priority mailings as well.
These particular services are probably the least expensive
services on the market, but they will ensure that your product
doesn't get lost or stolen en route to the retailer. They also
ensure a record of the retailer having received your product for
those few unscrupulous retailers that may not wish to pay for
your product if they received it by first class mail, but would
sell it and keep its profits.
7. At 30-day intervals, contact your retailers, whether in
person or via telephone, to inquire of any sales that have
occurred. While you can pick up payments locally, you should
have distant retailers forward you a check for payment that
corresponds with the number of unit sales.
You could also have them pay you online via a credit card
through PayPal, or another such online service. This would
eliminate lost/stolen checks through the mail, while
guaranteeing your payment quicker.
8. If, for example, within a 30-day period, you have three
sales, with two unsold units with a retailer, you have the
choice of either waiting for the remaining two units to sell
prior to forwarding more product to the retailer, or you can
offer to forward three more units to the retailer. However, it
is probably best to wait until the two remaining units sell.
9. In either above case, once all five units have sold at any
given retailer, begin the complete process over, starting with
the retailer signing or faxing another copy of the consignment
form in order to ensure accurate sales records and sales
continuity for your project.
Note: Should your project begin to experience a large sales
volume, you may wish to hire someone, i.e., a student or intern,
to work this aspect of your project, and whom you can pay a
commission for each sale. This will eliminate your need to pay
hourly wages or salaries, and will further save you money.
About the author:
Kenny Love is president of MuBiz.com, a multi-service music firm
providing radio promotion, media publicity, gig publicity and
business services for musicians. Get complete details at
http://www.myspace.com/kenlove
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