Profitability. The Studio numbers (incl Excel spreadsheet)

[Davido]

Originally Posted by jindrich

I can't believe this thread is still alive. The data I originally posted was a rather silly simplification of a rather basic studio.
I have done dozens and dozens of those ever since, helping engineers that entertained the thought of openning their own joint. The ventures are analyzed on a number of fronts, including both partial and 100% financing.

I have to say that in every case, the numbers DON'T work anymore. In the best case scenario they'll reach the breakeven point at most, which makes it for a terrible investment. In 99% of the scenarios there's no way to make the business stay in the black. That doesn't seem to discurage people though.


I'd like to point out a few things, that many future studio owners don't consider:

-If you start with some large amount to invest that comes from your own pocket, you have to consider that the same amount would make a profit elswehere, and therefore you have to substract that from the results/profit to compare investments
-Rent has to be included as an expense, even if you own the property, for the same principle as above.
-Amortization has to be considered, or else your entire investment dissapears after 10 years, or the period you consider.


Here's another sample I did time ago: you have to stay booked the entire month (27 days a month) just to break even.

YOU BOUGHT A GOD DAMN DUALITY FROM THE OFF AND EXPECTED TO MAKE MONEY?

Replace half of your ridiculous start up demands with cheaper, but still great, demands, and youd reduce your debts massively. And thus MAKE MONEY.

[Davido]

Originally Posted by piano

LOL... IF you read the other posts you would have already seen I am making my living doing this.

My point is simply that younger guys will have a hell of a time competing with us older established guys who already own the gear and facilities.

But thats always the case for every line of work.

The new hairdresser that leaves uni will compete with Saks, Tony & Guy.

The new bakery will compete with McDonalds etc.

[Davido]

Originally Posted by jindrich

Exactly.
And this (old) thread was supposed to be strictly about the economics and prospects of a professional recording studio, places that require investments of several hundred thousand €/£/$, if not millions -like the extraordinary new complex from Clueless.

No it wasnt. In fact, in your opening line you said "privately owned, one room mid size studios"

Nothing about professional, or million pound budgets.

[piano]

Originally Posted by Davido

But thats always the case for every line of work.

The new hairdresser that leaves uni will compete with Saks, Tony & Guy.

The new bakery will compete with McDonalds etc.

Na.... it's not the case for every line of work. There was a time where many people could get into computer manufacturing or auto manufacturing. Now, it's big money to even consider this line of work. Establishments have been formed.

Same goes with the recording biz. The new guys (with out big money) will have to do it radically different to break in. I say focus on music writing not recording.