The sell-off rights to merchandise aren’t well known to all musicians. However, it is something you should be aware of before you start to work with a merchandiser.
What are sell-off rights?
This simply means that the merchandiser doesn’t have the right to manufacture more merchandise right before the contract is over. They can only sell what is left in stock. Most merchandiser will ask to sell it through retail outlets as it won’t be sold on concerts. The artist will get royalties of these pieces that get sold. There should be no question in that. Before you take this step, there are a few things you, as an artist, need to ask for.
Buy it Yourself
Before the merchandiser sells your merchandise after your contract has ended, he or she should give you the chance to buy the rest of your merchandise back. If you have merchandise that you only sold online, it could be a good idea to start selling that merchandise at concerts too. It gives your fans the chance of having that one shirt they couldn’t order.
If you don’t buy the rest of your merchandise, the merchandiser will get a sell-off period. This can be anywhere within 6 months to a year. Just make sure that the sell-off rights are non-exclusive, so that if you work with another merchandiser you won’t get in trouble. And, the merchandiser cannot stockpile the merchandise. This means that they can’t manufacture more merchandise right before the end of the term. If you’re making an agreement, try to get this in the contract. Ask that they only manufacture a specific amount of merchandise so that this doesn’t happen.
Distress Sales or Dumping
Ask them to put this in the contract too. This means that merchandisers cannot sell your merchandise at very low prices just to get rid of the stock.
If you do get a sell-off rights agreement, they should ask you by the end of the term if you want to buy the remaining stock. If not, you ask them to get rid of the merchandise. With this meaning, destroying it. Or you ask them to donate it to charity.
Merchandise usually comes as an afterthought to people embarking on the journey of their music careers, but it’s a major revenue stream for many musicians and labels. Merchandise isn’t just a means to make money. It’s how your fans connect with you as an artist and as a brand, show their support and capture memories. Having merchandise allows people to express who they show they are part of your journey
Setting up your own line of merchandise doesn’t have to be complicated and you don’t have to do it alone. You just need the right partners to help you deliver on this aspect of your music business. Before you start, you need to know the five steps to building your line. We’ll walk you through these below.
1. Get your Merchandise Designs Made
Kanye West managed to sell plain white Egyptian cotton T-shirts at $120 a piece, but most artist merchandise needs a little bit of decoration to entice people to buy.
You need to create artwork that captures your values, the emotions you create, your beliefs; your brand, and it needs to connect with your fans on an emotional level. Not to mention your artwork has to be visually appealing and your fans have to be proud to wear it.
Think about what you want done before approaching an artist or designer to create your artwork. The more you can tell your designer about yourself, the better equipped they will be to create merchandise that you will be proud to sell and that your fans will actually want to buy.
2. Decide Which Products you Want to Sell
Once your artwork is complete and you’re satisfied, the next step is to choose which products to sell. Bare in mind, not all products are made the same. There are standard T-shirts and there are premium T-shirts for example.
Every category of products from T-shirts, sweaters and hoodies right through to varsity jackets, backpacks and beanie hats will have various manufacturers and product ranges within them and it’s your job to decide which ones you want to use. Consider the following when deciding:
- Quality of T-shirt; Standard or premium?
- Is the garment easy to re-label?
- How much does it cost?
- Does it fit nicely? Will your fans want to wear it?
- What does the fabric feel like and what is it made of?
These decisions will affect production costs which will impact your retail price. Don’t get me wrong, Beyoncé can sell her merchandise on a cheap Gildan Softstyle T-shirt for £35.00, but she’s Beyoncé. We have to be practical here and choose a product that looks and feels the way you need it to in order for you to feel comfortable selling it at the price you’re asking for.
3. Get your Samples or Mockups Made
Now your designs are made and your products are selected you need to be able to show people what the product will look like. There are two ways you can do this.
Get Mockups Made
This is a more cost effective way of showing people how your products will look. You can put the mockups on your website and use them to promote on social media. We can also provide you with images to produce your own mockups on. Just ask for access to our Google drive.
Get Physical Samples Made
Having a physical item that you can take photos of and promote on your social media channels and at your gigs may be a little more costly, but it’s certainly much more effective at getting people to trust and buy your products. Now they can feel the garments before making a purchase. People won’t buy a product from you if they can’t see it – unless maybe you’re Beyoncé.
4. Set Up your Sales Channels
Once you’ve created your products, you need a way for your customers to buy them.
A sales channel is simply a way of bringing products or services to market to make them available for purchase.
Selling online is essential if you want to reach more customers than you could offline. Get an e-commerce website built so that your customers can buy your products online. Research on the range of e-commerce platforms available and choose the right one for you. See suggestions:
- Big Commerce
- Woo Commerce
Selling Merchandise at Gigs
If you have a gig and you have a chance to take some of your merchandise with you, then do it. This is a chance for you to connect with your customers, talk to them, sign copies of your EP, take photos with them and make it a memorable experience.
If you can’t get a table, then wear your own merchandise. Bring a duffle bag or two and sell your merchandise to people straight out of the bag. After you’ve delivered your performance, people will want to become a part of your brand and your story. Don’t deprive them of this. Not everyone will have cash, so be prepared and get a portable card reader. We recommend the iZettle.
5. Production & Fulfilment
You will need a means by which to produce and distribute your products so that your customers will receive them. There are a few ways to approach this depending on your circumstance.
You can sell your products online without having to get them made in bulk and keep inventory and still earn a profit on your sales. You sell the product first and then we print and ship it to your customer on your behalf with you lifting a finger. It’s a good way to get started on a low budget and test out which of your products are most popular. Learn more about print on demand here.
Ordering in bulk is higher risk due to more cash being spent upfront, but will give you a higher profit margin. If you have a growing fan base and you’re selling regularly, this may be the route for you. Paying £5.00 per T-Shirt and selling them at £20.00 will give you pretty good margins with a relatively low breakeven point. It’s a good idea to learn about the different printing methods as well, which you can do here.
You can choose to keep your products yourself and ship them to your customers manually, but may consider outsourcing to a fulfilment centre when your operation grows.
So now you have everything ready, why not get started?
It can take a while to get everything prepared to start selling your merchandise, but once you’ve reached that stage then you’ve crossed a real milestone. Having the right guidance during the process is essential, and that’s why we’re here to help and offer our expertise.
We believe you should be able to earn a living from your craft and want to help you do that, so get in touch and let us know what we can do for you.
Get in touch with us at firstname.lastname@example.org or give us a call on 0116 350 0321.
Written by Kieza Silveira De Sousa from Wear Your Heart Out