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jamesrichings on 06/25/2015 at 02:01PM

Financing Your New Dance Record Shop

For anyone looking at launching a musical business in 2015, a dance record shop is a logical choice. Over the past few years the numbers for vinyl sales have continued to soar, signalling resurgence in this sector. In the first part of 2015 alone, there was a 53% year on year rise compared to 2014. In 2014 vinyl record sales crossed the 9 million mark for the first time in 20 years. Any industry posting such statistics is well worth investment!

What do you need for your new dance record shop?

Choose a location

This is the obvious first step. While the most ideal location is a busy area with high footfall, the proliferation of e-commerce means you can use any space you can find while creating a distinctive online shop to showcase your stock.

Decide on staff strength

The second step is to decide on staffing. The ideal size of staff for your shop is dependent on the size of the shop at launch. A small sized shop can be handled solely by one person but to ensure seamless operations, aim to have at least two individuals managing the shop. Keeping tabs of the stock, completing shipping and attending to all customer enquiries may be hard for a single individual regardless of the size of the shop.

Source for stock

This is perhaps the most important part of setting up your dance record shop. Your stock needs to cover house, techno, funk, disco as well as specialist old dance records. The items can be new or second-hand but there should be clear distinction in your catalogue. Your second hand stock will come mostly from car boots, charity shops and old shops but you can also get stock from DJs and members of the public willing to get rid of their records.

Advertise

Getting the word out about your shop is the only way to hasten success. In the early days, explore free advertisement options and scale up as the business grows for example, enquire about getting on the local radio.

Getting finance

Lack of funding is one of the main reasons a lot of people are unable to start up their dream businesses, and with the dance record shop it is no different. Getting the shop off the ground, bearing in mind the things listed above, will require a decent amount of investment. Here are three main ways you can get the essential capital:

Your savings

If you have any money saved up this may be a good time to put it to good use. Using your own savings means you don’t have to go through the wait associated with loans or bother about repayments with often extortionate interest rates.

Borrowing from family

If you have anyone within your family that has funds for investment this is a good time to talk to them. If they are impressed with the potential, they will be willing to part with the amount you seek without asking for interest, or for a stake in the business.

Crowdfunding

Crowdfunding is a relatively new method of funding a business idea. It involves reaching a number of individuals online or offline, mostly strangers, who will be willing to invest small percentages in your business to make up the amount you are looking for. The terms of investment vary depending on the type of funding. Investors may own a stake in your business or simply hold out for profitable repayment of the funds at a later date.

These three major ways of getting funds, however, have their drawbacks. For example, inability to repay money borrowed from a family member in a timely fashion can cause a strain on the relationship. This guide here does a great job of looking at the pros and cons of each method of business funding.

The age of the buying audience for vinyl records is generally

individuals below 35 years of age

. This paints a bright picture for the prospects of the industry. With proper planning and adequate funding, a dance record shop has immense potential in today’s global marketplace

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