Case Study: Producing 10’’ vinyl with Pijama Piyama
The amazing Phoenix indie/DIY cumbia band Pijama Piyama recently reached out for my help on the mastering work for their debut vinyl record. And, just a few months after its release, they’re getting very close to selling out their first production run-an amazing achievement!
The band has been kind enough to give permission for me to share the rough backend financial numbers that we developed during the project. You can view our spreadsheet here.
First, you’ll see all of the costs listed for the production run: mastering, production, packaging design, etc. The sheet then calculates the amount you’d need to sell the record for at the merch table in order to break even. It also shows you how many units you’d need to sell to break even, and your expected profits if you were to sell the run out.
Don’t lose your hat when producing vinyl-run the numbers first! My Can You Afford Vinyl calculator is always available for you to experiment with; punch in your own numbers and see what happens.
Here’s the detailed behind-the-scenes breakdown of how the Pijama Piyama 10’’ vinyl pressing project worked out.
Production costs and sales price
Production costs and sales prices for the Pijama Piyama vinyl record project.
To use this calculator, modify any fields marked in blue. Let’s go over each option from top to bottom:
Cost of vinyl mastering
This field reflects the cost of dedicated vinyl mastering for the run, in this case for 4 different songs. Note: this number does not reflect any costs for digital mastering. In this case, I was brought in to do the vinyl mastering only, and a different engineer handled the digital masters. That’s a bit unusual, but not unheard of; it would be more typical for the same person to do both the digital and analog masters, to maintain consistency in sound across mediums. That wasn’t a concern in this particular case.
Production cost per unit
The field lists how much each individual record costs from the pressing plant. You should get this number as part of any quote you receive from a pressing provider. Make sure you shop around and get multiple quotes on your project-this cost can vary significantly from provider to provider, and has a big impact on your potential profits.
Number of units produced
This field shows the total number of records produced for the run.
Shipping from the factory to you
Some pressing providers include shipping costs in their per-unit quote, others don’t. Make sure you factor those costs in either way: it can be expensive to ship a bunch of heavy boxes filled with records.
Other production costs
Any additional production costs should be totaled up and included here. This can be anything from design services to promotional copies, advertisement costs, etc. In this case, the additional $500 is a rough figure added for additional packaging design support. On this particular project, the band commissioned a friend for some artwork, and saved additional money by making their own stamps and screen prints of the album artwork in collaboration with local artists.
Sales to break even and potential profits on the project
Sales projections and potential profits on the Pijama Piyama vinyl record project.
Sales price per unit at the merch table
This number is modifiable, and lets you experiment to see how the numbers change depending on what you decide to charge at the merch table for this item. You’re aiming to strike a balance here between reasonable fair market rates, what you want to charge your fans, and what you need to charge to break even on the project.
Sales price needed to break even
This field calculates the lowest sales price needed to break even on the project. Make sure this number is not greater than the field just above it (Sales price per unit at the merch table).
Number of sales needed to break even
This field shows the number of sales needed to break even on the project. This should not be a negative number! If it is, you’re likely to lose money on this project. Make sure this number reflects a number of units you think you can realistically sell, and make it conservative. If you would need to sell 10,000 units just to break even on your project as a small DIY band, that might not be realistic for your current fanbase.
Units remaining after break even
This field shows the number of units remaining in the run after you’ve broken even on sales. This should not be a negative number! If it is, you’re likely to lose money on this project.
Gross profits after costs, if sold out
This field shows the potential gross profits on the project, if you were to sell out the run. This can give you a sense of whether it makes sense to pull the trigger on executing the project.
Note that this is not the amount of money you’ll pocket if you sell out the production run. Taxes, shipping costs, sales fees, and any other sales costs need to be subtracted from this number to calculate your net profits (the amount of money you’ll pocket).
These additional sales costs often only become fully apparent after the project has been completed and released to the public for at least 6-12 months. So, keep an eye on your sales figures after the project is released to get a better sense of your net profits over time.
