I'm in the process of starting one, mainly for the purpose of publishing my own band. What you need is an artist, a distributor and a handful of cash. A record

I'm in the process of starting one, mainly for the purpose of publishing my own band. What you need is an artist, a distributor and a handful of cash. A record label is in the business of creating and marketing the actual product, and the minimum cost is the price of pressing and shipping the records. The label might also front the money for recording, mixing, mastering, and hiring a designer to do the artwork. Booking, management and live promotion is usually a separate business area, but with indie music you'll often find bands, labels and promotion overlapping quite a bit. The tricky part is of course getting your product in the hands of your customers. Selling them online is one option, but if you want to get the records into stores, you really need to partner with one or more distributors. They take a percentage of the price (20% is a good number), and have established channels for promoting, selling and shipping the product. We're doing the first release on a shoestring budget. We've recorded and mixed everything ourselves, and traded services with a designer and photographer. I haven't gotten a quote from the pressing plant yet, but I've budgeted $500 for professional mastering and around $2000 for the first run of 500 12" records. CDs are alot cheaper (about half, I think). We need to sell around half to break even, Add in the costs for professional recording, mixing, artwork and promotion, subtract the money for the artist and the margin for the distributor and record store, and you'll see that you'll have to sell ALOT of records to make a decent profit. A couple of thousand unit solds is a big success for a small artist. Bigger labels will invest in artists expecting that most of the releases will be losing money, hoping to score a hit once in a while that will turn a profit. Starting an indie label in 2011 is not exactly a brilliant career move unless you're exceptionally savvy, but it's a fun and not too expensive hobby.