July 10, 2020

What is an Independent record label?

The term “Independent label” gets thrown around quite often in the music industry. When I was a young scholar I would often hear that word but I didn’t really know what it meant (I was that ignorant).

But what is an Independent Record Label?

That’s what we’re here to find out.

If you are new to the music game and are curious to know what an Independent label is, then this post is for you.

Without wasting any more time. Let’s get into it.

Definition

An independent record label in a true sense is a company that sells music without any external support. 

So that means as an owner you are self-sufficient. In other words, you are responsible for producing, marketing and even distributing your own music.  

This is not unique to the music industry.

When you come up with an idea for a product, there is a supply chain (even if you create it yourself) which a product has to go through until it gets to the end-user.

Who Can Start an Independent record label?

If you have an interest or passion for music you can start and run your own label. Starting is one thing but running a “successful” business is another.

How Can I start and register my own label in South Africa?

It’s easier to start a label now than before. You just need a product and a formalized business structure, that’s it.

Here’s a checklist:

  • The Product (single, EP, Album)
  • Register your company with CIPC for proof that you have a formalised structure
  • Apply and register for membership with the Southern African Music Rights Organisation (SAMRO)
  • Apply for an ISRC Code at the Recording Industry of South Africa (RISA)
  • Although it’s not a must, you can also apply to be an affiliated member with AIRCOSA
  • Find a reliable digital music distributor

The Advantages of owing or being signed to an independent record label

  • You are the boss.
  • You create and own your products outright
  • High-profit margins (You can make more money per record sold)
  • No pressure to release music or meet corporate deadlines
  • Internal communication is easier. The record label owner is just a phone call.
  • You have creative freedom and control on the type of music that you make
  • You can self-distribute your own music (It’s a tedious job though, I wouldn’t recommend it)

The Disadvantages of owning and being signed to an independent record label

  • It’s harder to break your music into the mainstream
  • It’s hard to scale when you’re independent
  • More money is required to market and promote artists and albums successfully to a national audience
  • Progress is often slower
  • Sometimes artists are not paid competitive royalty rates
  • Being a small company means you have to deal with uncertainty. The company could fail and go out of business in no time
  • Settling for high margins can sometimes result in a loss of volume (fewer records sold)

Takeaway

So there you have it.

I have just summarised and given you an idea of what an Independent record label is. I hope that you are now enlightened so you make informed decisions going forward.

If there something that you would like to share, your thoughts, opinions et cetera, please comment below.