PIPES STUDIOS
BUSINESS PLAN
A Business Plan for a Professional Voice Over Recording Studio
Table of Contents
Executive Summary
Business Description......
The Opportunity......
The Market......
Products......
Existing Clients......
Financial Summary......
1. Business Description
1.1 Company Overview......
2. Products and Services
2.2 Voice Over Recordings......
2.3 Digital Audio Editing......
2.4 Copy Writing......
2.5 Critical Success Factors......
2.6 Key Enablers......
3. The Marketing Plan
3.1 Existing Problems......
3.2 Market Needs......
3.3 The Solution......
3.4 Unique Features & Benefits......
3.5 Market Size......
3.6 Major Players......
3.7 Target Market......
3.8 Market Segmentation......
3.9 Emerging Market Trends......
3.10 Competitor Analysis......
3.11 Competitive Advantage......
3.12 Salary Research for Announcers......
3.13 Salary Research for Actors......
3.14 Pricing......
3.15 Promotion and Advertising Strategy......
3.16 Advertising & Promotional Budget......
3.17 Alternate Marketing Vehicles......
4. Sales Strategy
4.1 Sales Methodology......
4.2 Existing Customers......
5. Operations
5.1 Quality Control and Ongoing Service......
5.2 Technology......
6. The Management and Organization
6.1 Company Overview......
6.2 History and Current Status......
6.3 Company Organization......
6.4 Management Team......
6.5 Professional and Advisory Support......
6.6 Key Milestones......
6.7 Goals and Objectives......
6.8 Mission Statement......
6.9 Company Ownership......
6.10 Professional Development......
6.11 Risk/Opportunity......
6.12 Insurance......
6.13 Plans for the Future......
7. Financial
7.1 Important Assumptions......
7.2 Overview of Start-Up Costs......
7.3 Analysis of Start-Up Costs......
7.3 Balance Sheet......
7.4 Income Statement......
7.5 Cash Flow......
7.6 Financial Summary......
Appendices
Executive Summary
Business Description
Pipes Studios is a voice-over recording studio and audio production facility designed to serve the world's largest corporations and broadcast entities to complete audio productions such as radio and television commercials, telephone system recordings and voice-overs for business presentations.
The Opportunity
In recent years, cost – effective manufacturing of digital recording equipment has allowed freelance voice-over talents to invest in high-quality recording equipment at a reasonable price. Pipes Studios will serve both the local market and companies world wide via the Internet offering professional recordings and quick turn around at a reasonable price.
The Market
The research firm,Common Sense Advisoryrecently statedfor 2005 the total industry revenue for thelanguage services industry, including language translation and voice-over recording, was more than$8.8 billionworldwide in 2005 and is expected to reach over$12.3 billionby the end of the decade. According to the U.S. Department of Labor, Bureau of Labor Statistics, 2004 Census, the market is being served by 69,000 announcers and 100,000 unionized actors.
Products
Pipes Studios offers voice-over recording, digital audio editing and copy writing services to clients from around the world. This basic principle of value-added services and 100% customer satisfaction will act as the foundation for the delivery of audio productions from Pipes Studios.
Existing Clients
Clients that have already worked with Pipes Studios include Best Buy, McDonalds, Goodyear, Pixar, FOX, The Miami Heat, Euro Disney, Nike, Wal*Mart, The Waldorf Astoria and many more.
Financial Summary
A successful year in 2007 has proven the viability of the business model. Pipes Studios anticipates continuous profitability, a steady growth rate of 50% over the next three years with the goal of reaching $60,000 in gross sales within 12 months and exceeding $100,000 in gross sales within the next 36 months.
1. Business Description
1.1 Company Overview
Pipes Studios is a voice-over recording studio and audio production facility located in Minneapolis Minnesota and has been operating as a sole proprietorship since January 1, 2007. As a start-up, Pipes Studios has written a business plan, developed a strategic marketing plan, consulted with financial and business advisors and is now seeking capital for start-up costs.
Pipes Studios is owned and operated by Pipes O’Brien, a voice actor, who uses his natural gifts, predominantly his voice and mastery of it, to infuse life into the written word. Mr. O’Brien is a creator of voice overs; voice overs are the audio component of a media application commissioned by a client. As a professional voice actor, Mr. O’Brien is the producer of the creative vocal work that is recorded and used for a variety of applications including commercials for radio, television, telephone, podcasts, audio books, video games and more.
While Pipes O’Brien manages the day to day operations of Pipes Studios, he has developed a trusted network of business and financial advisors including an accountant, lawyer and banker, all of whom provide Mr. O’Brien with practical business advice to help ensure the success of Pipes Studios.
On the technological front, Pipes Studios maintains a balance between trust and proven technologies to manage daily activities as well as some cost-saving advanced communications technologies such as Instant Messaging, Voice Over IP and SaaS ( Software as a Service ) all of which will provide Mr. O’Brien with an excellent return on investment as the business grows over the coming years.
2. Products and Services
2.1 Description of Services
Pipes Studios provides three complementary services; professional voice-over recordings, music production and copy writing services.
2.2 Voice Over Recordings
A “voice-over” is defined as the voice of an unseen narrator, or of an onscreen character not seen speaking, in a movie or a television broadcast. The voice-over may be spoken by someone who also appears on-screen in other segments or it may be performed by a specialty voice actor. Voice-over is also commonly referred to as "off camera" commentary.
Pipes Studios provides voice-overs for television commercials, television station promos, radio commercials, radio station promos, podcasts and Internet broadcasts, telephone system recordings, voicemail messages and on-hold marketing programs, recordings for business presentations, educational videos and documentaries as well as movie trailers, character voices for cartoons, video games and computer games.
2.3 Digital Audio Editing
Audio post-production is now more a process of elaboration and embellishment than a process of necessary correction and repair. Although broadcasts are sounding better, the production can be greatly enhanced to sound more like a polished broadcast. The objective is to make a broadcast flow seamlessly from one segment to the next and the key is outstanding digital audio editing.
Automatic Dialog Replacement or ADR, is simply re-recording specific lines that could not be salvaged in the edit. The sound and performance of the lines must be matched to the original performance. For a successful re-take, all that is needed is for Mr. O’Brien to create the original take by recording in the same tone of voice, through the same microphone.
2.4 Copy Writing
A professional sounding audio production is likened to the audio aired in a news cast or documentary. The script is written out and rehearsed prior to recording. Generally a broadcast may have particular themes that are explored in sequential order, demanding more structure and precision. Copy writing is the art of crafting words.
2.5 Critical Success Factors
Critical Factor #1: Business sense
Critical Factor #2: Artistic ability
Critical Factor #3: Technical skills
This basic principle of value-added services and 100% customer satisfaction, will act as the foundation for Pipes Studios.
2.6 Key Enablers
•Offering value-added services
•Ensuring 100% customer satisfaction
•Mastering ProTools the digital audio editing software
•Expanding knowledge of all areas related to audio recording
•Committing to career development through workshops, seminars and conferences
•Adapting to change, developing new skills and applying knowledge
3. The Marketing Plan
3.1 Existing Problems
Small business from around the world depend on effective marketing initiatives and have turned to new media to communicate with their existing customers and to acquire new customers. While it may be easier to spread the message, recording it is not as simple. Many small business owners and those managing new media channels have limited technical production skills become frustrated when trying to record the voice over themselves and are overcome by inflated costs working through expensive agencies and have even cancelled projects due to poor planning and missed deadlines.
3.2 Market Needs
Small businesses need a simple solution to the recording, editing and delivery of voice-overs. Managers require fast, reliable freelancers that they can depend on when a project requires a voice-over. If a written script is required, many small businesses appreciate a voice actor that will do the research and writing. Finally, businesses need the peace of mind that comes with knowing the work is backed-up and hosted in a secure location.
3.3 The Solution
Pipes Studios satisfies the market needs of small businesses, delivering an easy, fast and reliable way for people to complete their voice-over recordings. When a client is facing tight budgets and looming deadlines, Pipes Studios provides a simple solution to getting work done on time and within budget.
3.4 Unique Features & Benefits
•Access to an award-winning voice talent with a fully equipped recording studio.
•Most projects can be completed with 48-72 hours.
•Request a price quote online and receive a reply within the hour.
•Financial transactions are processed online, eliminating the complexity of outsourcing.
•Computer files are archived and stored in a secure location for back-up.
3.5 Market Size
Common Sense Advisoryrecently statedfor 2005 the total industry revenue for thelanguage services industry, including language translation and voice-over recording, was more than$8.8 billionworldwide in 2005, and is expected to reach over$12.3 billionby the end of the decade.
- Common Sense Advisory, 2005
Based on industry research from AFTRA (American Federation of Television and Radio Artists), there are 300,000 union voice talent in North America. Additionally there are an estimated 1,000,000 non-union voice talent who are semi-professional and are also providing voice-over services on a freelance basis. This totals more than 1,300,000 professionals servicing the industry.
- Estimates provided by Voices.com, 2007
Announcers held about 69,000 jobs in 2004. About 57 percent were employed in broadcasting. Another 27 percent were self-employed freelance announcers who sold their services for individual assignments to networks and stations, to advertising agencies and other independent producers, or to sponsors of local events. About 30 percent of all announcers worked part time.
- U.S. Department of Labor, Bureau of Labor Statistics, 2004
3.6 Major Players
•ACTRA (Alliance of Canadian Cinema, Television and Radio Artists)
•AFTRA (American Federation of Television and Radio Artists)
•SAG (Screen Actors Guild)
•TAMAC (Talent Agents and Managers Association of Canada)
•Voices.com (The Online Marketplace for Voice Talents)
3.7 Target Market
•Marketing Departments for Small and Medium Sized Businesses
•Advertising Agencies
•Talent Agencies and Casting Directors
•Recording Studios and Audio Production Facilities
3.8 Market Segmentation
Types of voice-over recordings by percentage completed at Voices.com in 2007
3.9 Emerging Market Trends
•E-Recruiting
Relevancy: Outsourcing audio production to Pipes Studios, a specialized service and leader in the field.
Research: The world’s largest companies are looking to the Web for their recruitment and placement needs. The worldwide market for “eRecruiting services” is expected to generate nearly $15.7 billion in revenues by 2006 (IDC, 2002).
•Podcasting
Relevancy: Podcasting technology allows businesses to create their own radio shows and reach their target audience. The professionals at Pipes Studios eliminate the technological hurdles, allowing businesses to reap the rewards of delivering unique audio content to their customers on a more personal level.
Research: 50 million units sold worldwide, the iPod has a 90% market share in the hard disk-based media players - June 2006, Streaming Media. 12.3 million households will synchronize podcasts to their MP3 players - The Future Of Digital Audio - March 2005, Forrester Research
•Satellite Radio / HD Radio
Relevancy: For the past decade, radio stations have been replacing analogue equipment with state-of-the-art digital technology and systems. Pipes Studios delivers broadcast-ready digital files formatted to the station’s specifications.
Research: 20.1 million households will listen to satellite radio - The Future Of Digital Audio - March 2005, Forrester Research
•Audiobooks
Relevancy: Book publishers, and most recently newspapers and magazines are converting their content into an audio format that is easily digestible, and connects with listeners on a more intimate level.
Research: Veronis Suhler Stevenson stated that the far larger marketplace of words is a $41 billion opportunity in digitizing newspapers, magazines, and books. - Veronis Suhler Stevenson March 2006
3.10 Competitor Analysis
STRENGTH / WEAKNESS / OPPORTUNITY / THREATPipes Studios
Voices.com
Other Websites
Voice Talent Agencies
Other Voice Talents
SWOT analysis of sources for voice over talent.
Competition for jobs as announcers will be keen because the broadcasting field attracts many more jobseekers than there are jobs. Small radio stations are more inclined to hire beginners, but the pay is low. Applicants who have completed internships and those with related work experience usually receive preference for available positions. Because competition for ratings is so intense in major metropolitan areas, large stations will continue to seek announcers who have proven that they can attract and retain a sizable audience. Announcers who are knowledgeable about business, consumer, and health news also may have an advantage over others. While subject-matter specialization is more common at large stations and networks, many small stations also encourage it.
3.11 Competitive Advantage
Competitive advantage is a direct result of quickly establishing exclusive partnership agreements with complementary businesses and web services. Pipes Studios is currently in discussions with two key players within the industry.
3.12 Salary Research for Announcers
According to the statistics, salaries in broadcasting vary widely but generally are relatively low, except for announcers who work for large stations in major markets or for networks. Earnings are higher in television than in radio and higher in commercial broadcasting than in public broadcasting.
Median hourly earnings of wage and salary radio and television announcers in May 2004 were $10.64. The middle 50 percent earned between $7.43 and $16.81. The lowest 10 percent earned less than $6.16, and the highest 10 percent earned more than $27.61. Median hourly earnings of radio and television announcers were $10.49 in the radio and television broadcasting industry.
Median hourly earnings of wage and salary public address and other system announcers in May 2004 were $10.56. The middle 50 percent earned between $7.72 and $16.24. The lowest 10 percent earned less than $6.33 and the highest 10 percent earned more than $23.90.
- U.S. Department of Labor, Bureau of Labor Statistics, 2004
3.13 Salary Research for Actors
Minimum salaries, hours of work, and other conditions of employment are covered in collective bargaining agreements between the producers and the unions representing workers. The Actors’ Equity Association (Equity) represents stage actors; the Screen Actors Guild (SAG) covers actors in motion pictures, including television, commercials, and films; and the American Federation of Television and Radio Artists (AFTRA) represents television and radio studio performers. Some actors who regularly work in several media find it advantageous to join multiple unions, while SAG and AFTRA may share jurisdiction for work in additional areas, such as the production of training or educational films not slated for broadcast, television commercial work, and interactive media. While these unions generally determine minimum salaries, any actor or director may negotiate for a salary higher than the minimum.
Under terms of a joint SAG and AFTRA contract covering all unionized workers, motion picture and television actors with speaking parts earned a minimum daily rate of $716 or $2,483 for a 5-day week as of October 1, 2005. Actors also receive contributions to their health and pension plans and additional compensation for reruns and foreign telecasts of the productions in which they appear.
According to Equity, the minimum weekly salary for actors in Broadway productions as of June 30, 2005 was $1,422. Actors in Off-Broadway theaters received minimums ranging from $493 to $857 a week as of October 23, 2005, depending on the seating capacity of the theater. Regional theaters that operate under an Equity agreement pay actors $531 to $800 per week. For touring productions, actors receive an additional $777 per week for living expenses ($819 per week in higher cost cities).
New terms were negotiated under an “experimental touring program” provision for lower budget musicals that tour to smaller cities or that perform for fewer performances at each stop. In an effort to increase the number of paid workweeks while on tour, actors may be paid less than the full production rate for touring shows in exchange for higher per diems and profit participation.
Some well-known actors—stars—earn well above the minimum; their salaries are many times the figures cited, creating the false impression that all actors are highly paid. For example, of the nearly 100,000 SAG members, only about 50 might be considered stars. The average income that SAG members earn from acting—less than $5,000 a year—is low because employment is sporadic. Therefore, most actors must supplement their incomes by holding jobs in other occupations.
Many actors who work more than a qualifying number of days, or weeks per year or earn over a set minimum pay, are covered by a union health, welfare, and pension fund, which includes hospitalization insurance to which employers contribute. Under some employment conditions, Equity and AFTRA members receive paid vacations and sick leave.
Median annual earnings of salaried producers and directors were $52,840 in May 2004. The middle 50 percent earned between $35,550 and $87,980. Median annual earnings were $75,200 in motion picture and video industries and $43,890 in radio and television broadcasting.