HOW TO CALCULATE PRICING YOUR MUSIC CORRECTLY: PART 5
Consolidate Your data
After you have accumulated all the data needed from Parts 1 - 4, the next step is to calculate and create a total cost of service. An example of a consolidation chart is below.
Time: 3 hrs @ $35.00 hr = $ 105.00
Depreciation 3 hrs @ $ .70 hr = $ 2.10
Overhead 3 hrs @ $ 4.87 hr = $ 14.61
Outsourcing 27hrs @ $30.00 hr = $ 900.00
or FlatRate @ $500 - $900
TOTAL EXPENSE FOR SONG = $ 1021.71
Ok, now that we have the estimated cost of Making a song. Let’s look at what it would take to recoup your expenses.
We need to make up the $1021.71 and try to make more. We are only looking at front end payment. There are so many different avenues to make money from your song. So, let us consider that Gravy. The focus is to recap your expenses.
How many copies of your song do you need to sell in order to recoup expenses? Well, what is the market and do you want to compete with or do you have a special idea on how to overcome the standards.
Taking a look at the norm, the average songs online are going for $29.99. Using that model we find you will need to have sell 35 (rounded off) units of your music online to recoup losses. That’s not including royalties and other avenues of revenue available to you.
Seeing the bigger picture on how to price your music will help you plan for growth and succeed in the music industry.
GOOD LUCK; LETS MAKE MONEY FROM WHAT YOU LOVE!