Housold Records

@thehousold

+254 711 593 283

Housold Records

housoldstudios@gmail.com

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Presented by MELDRICK SAKANI

Registration number: ACJI/05604/2013S

Course code: ACJI/3208

Email: meldricksakani@gmail.com

Course Tutor: Dr. THUKU ESTHER Ph.D.

Faculty of Social Sciences and Technology

School of information and Communication Studies

Department of Journalism and Media Studies

Submitted to the Technical University of Kenya in Partial Fulfillment for the award of the
Degree of Bachelor of Technology in Journalism and Media Studies

March 20, 2016

HOUSOLD RECORDS

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 Table of Contents
DECLARATION........................................................................................................................5
DEDICATION............................................................................................................................6
ACKNOWLEDGEMENT......................................................................................................... 7
EXECUTIVE SUMMARY........................................................................................................8
BUSINESS DESCRIPTION.................................................................................................. 8
MARKETING PLAN.............................................................................................................8
ORGANIZATION AND MANAGEMENT.......................................................................... 8
OPERATIONAL AND PRODUCTION PLAN.....................................................................9
FINANCIAL PLAN............................................................................................................... 9
CHAPTER ONE: BUSINESS DESCRIPTION...................................................................... 10
1.1​ Business Name.......................................................................................................... 10
1.2 Business Location and Address......................................................................................11
1.3 Legal Structure of the Business......................................................................................12
1.4 Type of Business.............................................................................................................13
1.5 Products and Services.....................................................................................................13
1.6 Justification of the Business Opportunity...................................................................... 14
1.7 The Industry................................................................................................................... 15
1.8 Business Roles................................................................................................................15
1.9 Entry and Growth Strategies.......................................................................................... 16
CHAPTER TWO: MARKETING PLAN................................................................................16
2.1 Customer........................................................................................................................ 17
2.2 Marketing share..............................................................................................................18
2.3 Competition.................................................................................................................... 19
2.4 Advertising and Sales Promotion................................................................................... 25
2.5 Pricing Strategy.............................................................................................................. 25
2.6 Sales Tactics................................................................................................................... 25
2.7 Distribution Strategies....................................................................................................26
CHAPTER THREE: MANAGEMENT PLAN....................................................................... 27
3.1 Business Management and Qualifications..................................................................... 27
3.1.1 Qualifications and Role of the Business Management............................................ 27
3.1.2 Major Sections in the Business................................................................................ 29
3.1.3 An organogram showing the Organization of the Housold Studio..........................30
3.2 The Key Personnel......................................................................................................... 30
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 3.3 Other Personnel.............................................................................................................. 31
3.4 Recruitment, Training, and Promotion........................................................................... 31
3.4.1 Recruitment..............................................................................................................31
3.4.2 Training....................................................................................................................31
3.4.3 Promotion.................................................................................................................31
3.5 Remunerations and Incentives........................................................................................32
3.5.1 Remunerations......................................................................................................... 32
3.5.2 Incentives................................................................................................................. 32
3.6 Licenses, Permits, and By-Laws.................................................................................... 32
3.7 Support Services.............................................................................................................32
CHAPTER FOUR: OPERATIONAL PLAN...........................................................................33
4.1 Operational Facilities and Capacity............................................................................... 33
The office space................................................................................................................ 34
4.2 Operational Strategy.......................................................................................................35
4.3 Operational Process........................................................................................................36
4.4 Regulations Affecting Operations.................................................................................. 37
CHAPTER FIVE: FINANCIAL PLAN...................................................................................38
5.1 Pre-Operational Costs.....................................................................................................38
5.2 Working Capital Requirements...................................................................................... 38
5.3 Project Cash Flow Statement for Year One....................................................................39
5.4 Preparation of Pro-Forma Income Statement................................................................. 40
5.5 Pro-Forma Balance Sheet............................................................................................... 41
5.6 Calculating the Breaking Even Point............................................................................. 41
5.7 Expected Profitability Ratio........................................................................................... 42
5.8 Desired Financing...........................................................................................................43
5.9 Proposed Capitalization..................................................................................................43
CHAPTER SIX: RISK PLAN................................................................................................. 44
1.​ Risks of finances........................................................................................................... 44
2.​ Social Cultural Risks.....................................................................................................44
3.​ Ecological Risks............................................................................................................45
4.​ Legal Risks....................................................................................................................45
5.​ Technological................................................................................................................ 45
6.​ Economical and Industrial risks.................................................................................... 45

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 DECLARATION

I declare in all honesty that this is my own innovative work, which has
not before been presented by any entity, group of people or any individual for
the award of Certificate, Diploma, or Degree.

NAME: MELDRICK SAKANI

SIGNATURE: __________________________

DATE: ________________________________

DECALRATION BY THE SUPERVISOR

This business plan has been presented to the Technical University of

Kenya Examination council with my approval as the supervisor of the candidate
for the award of A Bachelor of Technology Degree in Journalism and Media
Studies.

SUPERVISOR: Dr. Thuku N. Esther, Ph.D.

SIGNATURE: _________________________

DATE: ________________________________

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 DEDICATION
I dedicate this business plan to my loving mother Cecilia and my father
the late Mr. Aoll Sakani, may God rest his soul in Peace, eternal. I also give
special dedication to my friends who facilitated the writing of this business plan,
they include but not limited to Opiyo Otieno, Latif Ahmed, Makhanu Nanjala,
Otieno Oyier and Kirimi Murithi. I dedicate this business plan to my Uncle Mr.
Katiambo for the crucial role he played in my University Education, to my life
coach Mr. Odhiambo James and to Dr. Joyce Omwoha who remain my personal
mentors in life and very crucial parts of my Education.

The almighty God cripple you with blessings, unending.

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 ACKNOWLEDGEMENT
I send my special thanks to Mr. Katiambo David, Mr. Odhiambo James,
both of who’s help I would never have made it this far without. I thank my
family for their moral support, my mother for her prayers, and my friends Frank
Opiyo and Opiyo Otieno for the true friendship they have continued to show
me. I thank my amazing classmates; the college experience could never have
felt better. I thank all the people I might not be able to mention that have offered
me spiritual and emotional nourishment in my studies at the Technical
University of Kenya.

I also thank my supervisor Dr. Thuku Esther for her guidance and
patience in supervising my work.

May you be struck by the lightening of God’s blessings

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 EXECUTIVE SUMMARY
BUSINESS DESCRIPTION
The business shall be called Housold Records representing a Music Recording Studio
that shall engage in music writing, music composition, music production and distribution
with a combination of public relations and show business. The Studio will be located in
Nairobi City in South B Estate at the Resilient Park apartments, close to the Kenya Institute
of Mass Communication and the Technical University of Kenya Men’s Hostel. The place is
strategically suitable as it is surrounded by learning institutions such as Technical University
of Kenya Men’s hostel, the Kenya institute of Mass Communication and a couple more
residential and commercial residences that house young people hence potential talent and
partners in the business. Not so far from this location is the seat of the Kenya Television
Network (KTN) Headquarters, which shall again be a major partner in the business of
entertainment. The business will be a start-up partnership between two individuals, the Vice
and the Deputy Producer with its first operation expected to kick off on the 1st of December
2017.

MARKETING PLAN
From market search and analysis I have found that the area of music industry in
Kenya lacks the element of marrying business and professionalism into the craft and this is
the reason why artists cannot support themselves by the use of their music. The market for
this business will comprise of individuals, commercial and institutional customers. Since
there are competitors the business is bound to face in the market, the business aims at getting
a big market share by capitalizing on the competitors’ weaknesses. This will include laying
down a pricing strategy in regards to the cost of services, labor and price charged by
competitors. In order for the business market to grow fast it will find strategies to cope with
competition and via the use of advertisements, talents shows and exhibitions of art create
awareness of the products and services.

ORGANIZATION AND MANAGEMENT

The owners of the business shall be the Vice Producer and the Deputy Producer.
Because I will have a Degree in Bachelor of Technology in Journalism and Media Studies
with a bias towards Broadcasting and Production, I will well be able to handle the duties and
the responsibilities that come with the Job. My colleague will likewise hold a Degree in
Music and a proficiency in music production and this makes him fit to perform the duties of
music Production. It will be the mandate of the Vice Producer to oversee the operations of the

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business, supervision, controlling and coordinating all Studio activities, making key decisions
and overseeing various events, functions and meetings of the Studio. Training of personnel
will be offered by the business and re-numerations will be given accordingly on a bi-monthly
basis. The business will also take in motivating workers through bonuses, offs and gifts, end
of year party, promotions and salary increments and other benefits. The business before start
will obtain all legal requirement e.g. registration certificate, license, certificates for copyright,
business permit and by-laws compliance certificate from the Nairobi city council as well as
taking an insurance cover for the business.

OPERATIONAL AND PRODUCTION PLAN

The business having recruited its employees and equipped the premises with the
necessary facilities like furniture and fitting, networking equipment, computers, telephone,
this will be aided by the capital that will be available for the business. Selling of services and
booking of Studio time and appointments will be done online through our Studio websites.
Soft copy delivery of music products will be done to the customers with the use of mobile
phone applications. The Studio shall create mobile phone applications from where the
followers of our music can be able to directly access the music form the Housold, in real time
as it is produced. The business will be operating from 8:00 am to 8:00 pm apart from main
public holidays and on Sunday. On special occasion however, the business will open her
doors to the public holidays because them is when many people make use of the
entertainment services. The business will too adhere to rules and regulations affecting
business operations like licenses, health and insurance cover.

FINANCIAL PLAN
The estimated amount that the business will require to start is Kshs 2,000,000 which
will be obtained from different sources. The sources will be; personal savings – Kshs
1,200,000, contributions from friends and family – Kshs 800,000. The business’s working
capital is expected to increase with time.

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 CHAPTER ONE: BUSINESS DESCRIPTION
The chapter shall identify the name and reasons for the name of the business. It shall
identify the particular location for the business, the legal structure of the business and the
type of business that is carried out by the entity. The chapter endeavors to justify the
existence of the business, explaining the industry that the business is venturing into, the
products and services that shall be offered in relation to current products and services in the
market. The chapter shall conclude by detailing its strategies for entry and growth and shall
explain her short term and long term goals in the business.

1.1​ Business Name

The business shall take the name HOUSOLD RECORDS (pronounced
“house-hold”). There are several fundamental principles that inform the adoption of this
name. First, the name originates from the term “household,” for this reason and for the sake
of memorability, the name HOUSOLD is best placed to represent the entire business. When
someone calls you simply say, “I’m at the Housold!”

Secondly, the term signifies the mission and vision of the studio. The studio shall
produce music that appeals to all genres in the “house hold” and hence shall grow to become
a “house hold name.”

Thirdly, the studio endeavors to focus on the business of making music work for the
artists. I understand that music in Kenya particularly and Africa at large suffers due to the
effects of piracy and the failure by the already existing entities like the MCSK. the studio
shall therefore adopt a global and thoroughly aggressive approach to the promotion, sale and
marketing of the music, and the ‘untapped digital market’ that works in the new age of music
business, hence the term “sold” within the name, HOU-SOLD. “Housold music is totally sold
out”

The studio shall combine Music and Public relations, in a spirit that says, ‘why make
music if they don’t get to listen?’ Therefore, if it is not sold, then it certainly is not Housold!
Another important aspect that was drawn into the selection of the name is that the studio
seeks to attract talent in much the same breath as it seeks to attract audience for the talent.
The studio shall be “a second home to the artist so to speak. Not only shall it produce the
music, it shall train, source, and advice talent on the best practice. Simply put, it shall be the
“household” where talent meets.

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1.2 Business Location and Address
For a start, the business shall be located in the entrepreneur’s house in his resilient
park apartment in South B Estate of Nairobi, second floor, house number ten. The
location was selected out the fact that it would be easier to cut down on extra costs as a
way to gain advantage at the initial stages of the business and also to be able to benefit
from the availability of human resources and potential institutions available around the
geographical location. For instance, the Kenya Institute of Mass Communication.

Figure 1.1.1 Google Maps showing the Geographical location of the business

In relation to the map above, the business shall be located exactly opposite the Kenya
Institute of mass Communication. Location close to a center for learning, a center that
focuses on the development of art is also strategically targeted to attract both the talent and
market for the talent. This location is also suitable because of its close proximity to the CBD,
which is a central attraction for business.

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Clients can reach the studio through the following contacts

Telephone: +254 711 593 283

Cell: 020 737 750 859

Email: housoldstudios@gmail.com

housoldrecords@gmail.com
acesakani@gmail.com

Blog : http://housoldstudios.wordpress.com

Website: www.housoldstudios.com

Facebook: housold studios

Twitter: @thehousold

P.O. Box 70-00300

Ronald GPO Nairobi

1.3 Legal Structure of the Business

The business will begin as a partnership between two individuals, the sound producer,
and the video producer, with the view to grow into a publicly owned company listed in the
securities exchange. There shall exist two major branches of the business, the audio arm, and
the video arm. Hence, the business shall function as a body containing two major organs
joined into one by the unity of purpose, the vision, the ambition, and the objectives.

The reason for a partnership is in order for the business to benefit from the wealth in
skills and knowledge that will come from the power of putting heads together. The
partnership will also make it possible to cut on the cost of capital.

I will play the role of the Sound Producer and my partner will be proficient in the
video aspect of the business.

I intend to invest 800,000 Ksh as starting capital for the business. This money shall
come from my own personal savings I intend to accumulate in a period of three years. My
partner shall invest an amount of 600,000 Ksh to cater for the video arm of the business. We

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shall also source for funds from family and friends to meet the remaining costs of starting the
business. The cost shall be broken down as follows:

●​ Apple Mac Book Pro core i7 with Retina display Ksh.275,000

●​ Yamaha Music mixer Ksh.50,000
●​ Camera 40,000
●​ Microphones, pop filters, and stands (rough estimate Ksh.40,000)
a)​ dynamic microphones
b)​ condenser microphones
c)​ large diaphragm microphones
d)​ stereo pair microphones
e)​ variable polar pattern microphones
●​ FireWire recording system Ksh.22,000
●​ Audio interface Ksh.7,000
●​ Digital Audio Workstation software Ksh.7000
●​ XLR cables ksh.2,000

The above expenditures are properly in line with the businesses’ budget. Other material
requirements shall be acquired in the course of running of the business. (The prices reflect an
exaggeration of extra Ksh.2000 to the current market prices).

1.4 Type of Business

The business shall primarily engage in the “creation of music.” The studio shall write
music, create beats, source talent, record the audio sound, shoot the video, promote, and sell
the music on behalf and by the permission of the talent. The business shall also carry out the
promotion of talent as brands to the global market sphere. The studio shall actively seek out
talent by organizing talent shows, and contests; it shall train the talent by its own talent
academy and shall manage the talent by the use of “artists” managers. Other independent
artists shall also be able to access these services at a fee. Aside from music, the studio shall
create animation, radio, and television commercials, and merchandises that aim at promoting
the image of the talent as a brand. The studio shall transact contracts on behalf of the artists in
the place where the artists need that kind of legal help with the sale of their work.

1.5 Products and Services

The business shall produce and digitally distribute music audio and video, as the
primary product and service. The business shall also produce and sell television and radio

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commercials and animations. Promotion of music shows, artist promotion, and consultation
services shall also be served at the client’s request. One outstanding aspect about the business
is the “Public-Relationist” approach that it seeks to approach the music Industry. The
Housold shall give both the artist and their fans “the whole package”. “When an artist goes
into the Housold they come out a star.”

1.6 Justification of the Business Opportunity

Music as a business, unlike other genres of art, depends so much on the team that
works behind the artist much more than the talent and ability of the artist. The reason why
musicians like Sauti-Sol and Elani thrive in the “not so good” climate of the music industry in
Kenya is not so much on the talent they have but is highly due to the efficiency of the team
that is behind them. I began hearing of the Sauti sol band in 2009. The five men band was
formed in the year 2005.But it was until they were taken in by management team that works
behind them that they really made their mark outside of the African continent.

Enough talented artists out there are not earning anything from the sale of their music.
Being talented is a bonus per se. It is the way they say; “Behind every successful man is an
able woman” Understanding the dependent nature of art, and music in particular, the business
is taking a “public-relationist” approach to the music industry, an element that lacks in Kenya
and Africa’s music arena at large. There is relatively lower appreciation of talent in Africa
and artists are left to strive on their own devices.

My personal experience with the music industry is that the producer is not interested
in the artist’s gradual development and stability in the industry. There are more famous
producers in Kenya than there are musicians. In 2014, the Music Copyright Society of Kenya
released their list of distribution of the royalties to the musicians and the highest earner was
not a Musician, but a producer. This is to say, producers benefit more than the artists do.
More than enough artists cannot survive on their music but are rather stuck at doing side
hustles to fuel their careers in music, which should not be the case, years after venturing into
the music industry. This business aims to make music work for the artist.

Sometimes it happens that an artist is very talented and is not just as skilled when it
comes to conducting business and making his or her skill work for him. The Housold studio
shall come in between the artist and the business in order to protect the artist from elements
that would easily take advantage of them. After extensive research, the researcher found that

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there lacks such a body that stands back together with the artists. There exists legal structures
supposed to represent the artists but many a times the legislation in place takes the back seat.

I totally agree with Rapper Juliani when he says, Kenya lacks an established music
profession. Unlike other countries like Nigeria and South Africa, Musicians in Kenya cannot
afford personal assistants and managers. What the Housold studio does, it shall bring these
artists together and provide do them the services that other artists around the world get. The
Housold simply seeks to gather talent into one collective force and increase the bargaining
power, so that together common services that are a requirement among the artists are not
again beyond their reach and we get to have our voice heard. The studio seeks to create that
force that is the driving power behind successful artists around the world.

1.7 The Industry

In relation to the rest of Africa and the world at large, the Kenyan Music scene is
relatively fertile with an abundance of opportunity. There is yet plenty of opportunity lying
bare that only needs to be tapped. There lacks an elaborate infrastructure, that processes
music like an industrial manufacturing process. What we have in Kenya, are abstract pieces
that seek out to make quick returns and fold as quickly as they came. There lacks meaningful
investment in the music industry and the result of this is easily noticeable in the way all that
The Kenyan music does in the global sphere is to play catch up, catching up with trends that
are set by West African countries like Nigeria. This is an opportunity for investment given the
pivotal role that Kenya occupies in the East African region. There are not as many Music
recording labels as would compare with the West African nation of Nigeria, and South
Africa. The record labels that exist in Kenya mostly cater for the Gospel Music, leaving other
artists without a chance to thrive.

1.8 Business Roles

The primary goal of this business at its inception would be to attract as much talent as
it would attract audience to the talent within the first three years of its existence. The studio
shall endeavor to make music, as an art to become a business that one can earn meaningful
income. The business aims to tap the raw talent that exists in the country and beyond. The
business shall run with the long-term view of becoming a publicly owned company, the first
of its kind in Kenya, to be listed in the Nairobi Securities Exchange.

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1.9 Entry and Growth Strategies
The company plans to set out a robust campaign that targets the talent and the
audience at the same time. The studio shall open up multiple accounts in the social media
platforms that aim at selling the services of the company to the public. The studio shall also
be a massive hunt for exceptional talent that it will endeavor to mentor as a “pilot project.”

CHAPTER TWO: MARKETING PLAN

​ The chapter shall detail description of the target market the business hopes to attract,
and retain, giving reasons for this kind of business strategy. The chapter shall talk about the
market share in the industry it aspires to venture into and shall give a detailed analysis for
why it should exist at all and the kind of market it expects to capture at the stage of entry all
the way to the stage of growth. The chapter shall also give information about the expected
competition and the expected competitive advantage over the competition. Information about
the advertising strategies and the expected period for advertising shall suffice. Tactics for
sales, distribution, and pricing of the products shall be explained.

2.1 Customer
At the Helm of the target, audience that Housold Studios hopes to attract is the young
people. The studio generally fashions her products to appeal to the young adult generation,
with the view to widen out and cut across all possible genres in the House Hold.

Understanding the Unstable nature of many Family structures today, the Studio shall
endeavor to strike a connection between members of different genders, and ages in the
household. The studio shall use the young people of today to carry the “Housold” name home
and make it their own.

Beginning with the business’ geographical location, that of near major learning
institutions in the center of the city, the studio targets the young adult age group that is
normally crossing over and joining the working class. This group of young people is
normally the most pronounced in terms of Social media presence, consumption, and
participation.

This is normally the point in a young person’s life when they have graduated and yet
they still do not know whether they want to be formally employed or, they want to pursue
their talents. The availability of a clearly cut out infrastructure that caters for their fears,
indecision, and anxieties as a reflection of the dire situation of the music industry, will help

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them to want to pursue their dreams because of “that someone that will hold their hands to
the end.”

These college graduates are a group of people who have access to funds, either from
their part time of full time jobs. They are just about making the milestone decisions in their
lives. When these people have studied and have not found fulfillment in their studies, they go
out of convention and remember that they have talent and this is precisely that time when
they land at the Housold. The business will therefore ride on the group’s high-level
consumption of social media content and in this way will be able to ignite a social media fire
that is necessary in fueling show business.

2.2 Marketing share

The Housold studio seeks to claim 10% of the market share for a start.

Company/Competitor Percentage Market Share

Housold Records 10
Homeboyz Studios 20
Main switch Productions 15
Kingdom Music 5

Pie chart showing the market share the business hopes to assume at the start

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 According to the statistics by UNESCO, showing the rate of the stability and the
maturity of the music industry in Africa, Kenya falls under the list of countries that are
emerging in the Music Industry. This is to say, there is a lot of potential and market that is
untapped in the music business, which is a advantage the business can ride on.

Figure 2data showing the music industry maturity in Africa: UNESCO

The leading players in the industry include the Homeboyz studio, the Calif records,
Real Sounds studio, kingdom Music, Main switch Production, eagles studios, Ogopa
Deejays, Grand Pa Records, Prince Cam media, cream Vision, Jomino, Penya records, Sub
Sahara records.

2.3 Competition

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 The table above represents data for the market analysis of the major player in the
industry. The table can only represent the players in the recording business. However it does
not quite tell who exactly is doing the business that the Housold cuts out for itself. We have
the Calif records dominating the industry because of their urban “ghetto” approach to music.
Their music primarily appeals to the low income market, comprising the population in the
informal settlements. Their competition is however neutralized by the urban approach that the
Housold will employ.

The expected market share

Company Percentage Market share

Housold Records 25
Homeboyz Records 20
Main switch Records 15
Kingdom Music 5

Below is a chart showing the projected Market Share the Housold is expected to
claim

Pie chart of Market share

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 The age of the internet

Figure 3 data for internet subscription in East Africa

Figure 4 data showing internet subscription in the rest of Africa

According to the two tables presented above, there is a general upward trajectory
among the internet users in Kenya in general and in the rest of Africa at large and this is
expected to be the trend for a long time to come. Understanding the nature of the market the
business seeks to attract the business shall not transact its products in exchange for money
alone. Instead, the business shall focus on selling data to the consumers in the form of
“internet bundles.” This is the new trend and it is something the company will benefit from
because instead of selling music for money, which is harder, the business shall focus on
selling online content for download and in this way, makes it easier to deal with the mobile

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phone companies that will automatically collect the revenue per every download. This
advantage will help boost the sale of music per unit, and will reduce the effect of piracy and
help in collection of credible data for the artist’s performance. In this way, the studio will
know which artist is the most valuable and which one needs some work to be done.

According to the statistics shown below, Kenya comes in third at 31% as the country
that has the third most access to internet in Africa, as of November 2015. This is a positive
advantage to the studio given that that Studio shall mainly use the internet as the primary
platform for distributing the audio and video products.

Figure 5data showing percentage of internet usage in African countries

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Competitor Strength Weakness
Homeboyz Studio ●​ Long years’ ●​ Very expensive
experience charges for
●​ Suitable location services
for optimal ●​ Does not promote
business artist music
●​ High capital base ●​ Inability to meet
of 2.5 million deadlines of project
●​ Good reputation delivery
and recognition ●​ Stuck in the old
●​ Controls 20% of modes of
industry distribution of
music
●​ Does not give
upcoming artists a
chance

Calif Records ●​ Perfect destination ●​ A bias towards

for Genge music Genge music
●​ Relatively reduces their
affordable for the listenership due to
upcoming artists low level variety
●​ Ample location for ●​ Lack of creativity
creative work and that locks them out
business of the international
●​ Recognized in the charts of music
industry ●​ Lack of the
●​ 7 years’ experience prospects of
in the market internationalizing
●​ Has several artist ●​ Lack of the
signed to them versatility of art in
their projects

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Kingdom Music ●​ Have a market ●​ Has a bias towards
share of 5% in the the non-gospel
industry musicians
●​ Control the ●​ Does not admit
majority of the secular musicians
region’s Gospel ●​ Invests dismally on
Music industry the video projects
●​ Is sufficiently and subsequent
recognized in the video quality
industry and well ●​ Charges are
sought after by up inconsistent
and coming artists ●​ Marred with
●​ Has high quality scandals of
level of corruption and
Productions conduct that is
●​ Is relatively cost inconsistent with
friendly to the artist what they purport
to stand for

Ways in which the Housold Records will counter the effect of the competitors

●​ Staying up to date and up to speed with the new and emerging modes of technology
for cost effective modes of transaction of business
●​ The Housold will admit very talented artist and nurture them and give them a chance
to grow and develop themselves
●​ The Housold Records will arrange for talent shows and talent searches to seek new
blood and talent
●​ The Housold will offer competitive prices for the same and extra services including
artist mentorship and the nurturing of talent
●​ The Housold will maintain a young, vibrant, talented and energetic crew that will
cater for the needs of the employees, the artists and the fans

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2.4 Advertising and Sales Promotion
The studio shall extensively employ the constant use of social media platforms to boot the
revenues and attract the talent to the company. There shall be created an online community
that will share stories and blogs about the activities of the Housold and the opportunities that
the readers can exploit. There shall be regular “star talent searches” that shall aim at
identifying talent within the community and in this way allow for the chance to interact with
the community within which the company operates in. forums such as these will also allow
for the collection of feedback about how the audience finds our work.

2.5 Pricing Strategy

Because the business seeks to reach out to the young adults in the society and the
public for the primary audience, the studio shall fashion its pricing for the recording of the
projects accordingly.

The following table details the market prices and the studio’s prices for the respective
products in the market.

Product or service Homeboyz Studio price Housold price

Audio Production Ksh 25,000 Ksh 15,000
Video production Ksh 40,000 Ksh 20,000
Animation production Ksh 70,000 Ksh 50,000
Voice over Demo Ksh 5,000 Ksh 3,000
Marketing of music Ksh 2,000 free
Radio commercials Ksh 50,000 Ksh 40,000
Mentorship of artist Ksh 21,000 Ksh 10,000

According to the table of comparison above, the difference between the price in the market
and the price the Housold proposes to employ in the running of its business. The comparison
hereunder is done between the Housold business and one of the leaders in the Kenyan music
industry, the Homebody studio.

2.6 Sales Tactics

Because chief of the products of the Housold Records are digital audio, videos,
animation, radio, and Television Commercials, the Studio shall primarily employ the use of
digital platforms to sell her products to the world. One of the major pillars of the business is

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the aspect of Public relation. The business shall therefore weave the principles of public
relations into every aspect of its transaction. The business shall not only record and produce
the artist, it shall in effect go an extra mile and promote the artist’s work in all the social
media platforms and

2.7 Distribution Strategies

The Housold Studio shall principally use the digital platform as its main Channel for
the distribution of its content. The studio shall employ the use of YouTube, Facebook, twitter,
and blogs both to reach out to the audiences and to distribute the products. This situation is to
say the studio is writing off the ancient tradition of writing CDs for the obvious cost
implications that might not be necessary today. With the rise in the number of Smart phone
Users in Kenya, the Digital platform is the most suitable to reach out to a massive audience in
a way that is timely, affordable, and efficient, without incurring extravagant costs dangerous
to the life of a startup business. The company shall develop a range of smart phone
applications from where followers of our social media platforms and many more of our
listeners shall be able to access our content in real time, efficiently and conveniently from the
comfort of their everyday lives. The audience shall also be able to access all information
concerning “what is cooking in the housold.” Investing in the digital distribution will also
help level in on the music pirates, as it will increase the number of original copies of the
music that are purchased. This will go a long way in fulfilling one of the objectives of the
studio; that of making music work for the artists.

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 CHAPTER THREE: MANAGEMENT PLAN
The chapter outlines the management structure that the business will adopt, detailing the
organization of the human resource personnel, the roles of each individual, the qualifications
that will actively be sought in employing the personnel, and the qualities an individual ought
to have to be awarded particular responsibilities. The chapter shall draw into perspective the
responsibilities that shall be carried out by each individual.

3.1 Business Management and Qualifications

3.1.1 Qualifications and Role of the Business Management
The Housold Studio Shall have three main arms: the Audio Unit (Aunit), the Video
Unit (Vunit), and the Public Relations Department (PR). Head of the Studio shall be the Vice
Producer, who shall work in close consultation with the Deputy Producer.

The Deputy Producer shall only subordinate the Vice Producer in his absence. There
shall be the provision for a Public Relation Strategist that shall operate between the offices of
the Vice Producer and the Deputy Producer. Initially the Public Relations office shall also act
as the Finance Unit of the Business until the business gains substantial growth. The Public
Relations Strategist shall act as a link between the two offices. Below is a table showing the
functions of the three main arms of the Housold Studio.

The Housold Studio shall be an equal, fair, Just opportunity employer. The Studio
shall strictly seek out individuals that are not only thoroughly talented an excellent at their
craft, but it shall also seek people that are committed and passionate about what they do. The
Studio shall however not strictly take academic credentials as the only viable qualification.
The Housold shall go out of its way to seek the skill and the desire where they are found.

Table 1 function and responsibilities of the three main persons in the Housold Studio

The Vice Producer The PR Strategist The Deputy Producer

●​ Generally provides
direction for the ●​ Acts as a link ●​ In charge of the video
Studio between the vice production unit of the
●​ In charge of making Producer and the studio
music beats, Deputy Producer ●​ In charge of the
recording audio ●​ In charge of the music production of both
sound and mixing composers audio and video
music commercials

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 ●​ Trains and directs the ●​ Mentors and advices ●​ Sources external
talent on the art of the talent about the personnel in the event
singing market of a need for one
●​ Shall be the link ●​ Acts as the Quality ●​ Proposes and
between the company assurance officer of recommends concepts
and the industry the Studio to be used and is in
●​ Shall carry out ●​ Organizes events that charge of hiring
transactions and shall promote the artists costumes and labor
make the major music required in the video
decisions on behalf of ●​ Organize talent shows shoot in consultation
the Studio, in in learning with the Studio
consultation with the institutions and the Designer
PR practitioner and public to help search ●​ In charge of selling
the Video Producer for talent the digital image of
●​ Shall ensure the ●​ In charge of the the Studio in
maintenance of sound wellbeing of the collaboration with the
equipment and recording artists and Digital Promoter
purchase of more acts as a mentor ●​ In charge of creating
equipment where ●​ Shall function as an animations for the
necessary intermediary between studio with the help
●​ In collaboration with the Sound producer of the Part time
the Studio Lyricists, and the Video Studio Animator
trains the artists on Producer maintaining ●​ Shall in collaboration
the art of lyric a close relationship with the Studio
composition, music between them Instrumentalist,
creation, and ●​ Shall facilitate ensure maintenance
performance communication of the video
●​ Overall managerial among members of equipment and the
and oversight of the the organization purchase of more
entire business ●​ Shall act as a torch equipment where
bearer and necessary
spokesperson of the
Housold Studio

The table below shows the qualifications for the three main positions of the Housold studio.

Table 2 table-showing qualifications for the three main arms of the Housold Studio

Office of the Vice Office of PR Strategist Office of the Deputy

Producer Producer

●​ A smart individual

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 ●​ Proficient in fruity ●​ Must have “people ●​ Must be proficient in
loops as a standard skills” the fields of Video
music making ●​ Must have more than production and
application 3 thousand plus animation
●​ Must be able to work followers on twitter ●​ Must be able to work
long hard hours and ●​ Must have an active hard and long hours
still be able to deliver social life and still deliver
excellent quality ●​ Must be easy going, quality work
work friendly and charming ●​ Excellent
●​ Ability to act as a ●​ Proficiency in music interpersonal skills
Disk Jockey composition ●​ Skills and experience
●​ A wealth of ●​ An excellent of handling both
experience in the salesperson motion picture
production of music ●​ An avid time keeper cameras and still
of more than four ●​ A diploma or degree photographs
genres in public relations or ●​ Efficient and
●​ A degree in Music communication is an excellent time keeper
production is an added advantage but ●​ Proficient in the art of
added advantage but not a priority music production and
not a primary ●​ A very smart Disk Jockey
requirement individual ●​ Must posses
●​ Must posses a ●​ High degree of managerial skills to
proficiency in easy integrity subordinate the Vice
and soft skills of Producer in the event
communication of his absence

3.1.2 Major Sections in the Business

The Studio shall be divided into two chief departments that shall be linked by the
office of the Public Relation Strategist. The business shall mainly be compartmentalized into
the Audio Unit (Aunit), and the Video Unit (Vunit).

The Public Relations Department (PR) shall come in as a link between the two main
departments. The Vice Producer shall be the Head of the Studio and the Deputy Producer
shall deputize the Vice producer and shall work in close consultation with him, by the
facilitation of communication between the two offices by the Public Relations Strategist.

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 The Deputy Producer shall deputize the Vice Producer in his absence. There shall be
the provision for a Public Relation Strategist that shall operate between the offices of the Vice
Producer and the Deputy Producer.

Initially the Public relation office shall also act as the Finance Unit of the Business
until the business gains substantial growth, enough to differentiate the two functions. The
Public Relations Strategist shall act as a link between the two offices. Below is a table
showing the functions of the threes arms of the Housold Studio.

3.1.3 An organogram showing the Organization of the Housold Studio

Figure 6 Organogram showing the Organization of the Housold studio

3.2 The Key Personnel

The key personnel in the management of the Studio are the Vice Producer, the Deputy
Producer, and the PR Strategist. There shall as well be the provision for the Executive
Personal assistant who shall also function as the Studio Designer and the Studio Lyricist who
will also work as the Studio Instrumentalist.

The Executive Personal Assistant and Designer shall function as the overall Personal
Assistant to the three arms of the Housold Studio. This office shall engage in the Scheduling
of studio sessions, arranging internal meetings, taking minutes, and running errands. This

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individual shall also be charged with the responsibility of assisting the recording artists
wherever they need that kind of help. He shall also be charged with the promotion and the
upholding of the Studio image by deciding the design of the outfits of members of the
Housold studio. In a sense, the Executive personal is the internal Relations strategist,
concerned with the image and the proper functioning of the three arms of the company.

The studio Lyricist and Instrumentalist shall have a proficiency in the art of Music
writing and Composition, and should be able to play at least three instruments. This
individual shall work closely with the Vice Producer in composing music and advising on the
kind of instruments to be used, the songs to be selected and the style of music to be
performed by particular artists. He shall also be in charge of the purchase and maintenance of
the Studio equipment.

3.3 Other Personnel

The place of a Digital Promoter and studio Animator for the studio shall be provided
for on a part time basis. This provision shall stem from the office of the Deputy Producer and
shall be charged with the responsibility of promoting the image of the Studio via the Social
Media Platform and the Creation of Animations on a contractual basis. The reason why these
two positions shall be provided on contract is how delicate they are. Animation and
advertising are two extremely fundamental aspects of the studio that need a high level of
efficiency and less wastage. The employees herein will therefore be required to sign a two
year contract that shall be renewed based on the quality of work done.

3.4 Recruitment, Training, and Promotion

3.4.1 Recruitment
Recruitments shall be done on a regular basis, depending on the need and the
applications the studio receives. Candidates shall strictly be selected because of merit and the
ability to fulfill the required credentials. The Housold studio shall be an equal opportunity
employer that will provide employment for people of all races, ethnicities, gender, and sexual
orientation without a bias towards personality and or academic background. Proficiency in
English and Kiswahili language and an extra language shall be looked upon with favor.

3.4.2 Training
Training of the candidates shall be done at the start of their first week in the Studio.
Immediately they meet the requirements for their jobs, they are put on probation. The

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Candidates are tried, and tested to ensure that they are the best candidates in the market and
that they meet the requirements of the Housold Studio.

3.4.3 Promotion
Promotion shall mainly occur by the means of an increase in salaries and allowances.
The little number of personnel means that there will likely not be enough titles to move up.
Therefore, the Employees of the Housold shall receive salary increments based on the amount
of effort they put into their work. The effort the employees put into their work shall be
measures by results they are able to realize. For example, how rapidly their sphere of the job
escalates, how much viewership the Studio gets and how much talent signs up with the
Studio.

3.5 Remunerations and Incentives

3.5.1 Remunerations
The employees of the Housold studio shall be paid every half of the month. The artists
shall be paid a half-monthly up keep stipend of 30,000 as insurance to their royalties, but this
shall be subject to the amount of sales in revenue they are able to generate.

The table below details the bi-monthly remunerations of the Employees of the Housold
Studio

Title Remuneration
Vice Producer 35,000
Deputy Producer 30,000
PR Strategist 20,000
Executive PA 15,000
Studio Lyricist 10,000
TOTAL 110,000

3.5.2 Incentives
The Studio shall provide free rides home for her employees every evening. There
shall be the provision of Breakfast and Lunch Cards every five days of the week. There shall
be the provision for Gift cards during holidays such as Christmas and New Year’s days
among many other days.

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3.6 Licenses, Permits, and By-Laws
The Vice Producer shall ensure the licenses for conducting Business by the Studio are
updated. Being a Music Creation, Production, and Distribution Company, the studio shall
require having a business Permit by the City Council, a License by the Music Copyright
Society of Kenya and a Certificate of registration as a legal Business entity by the City
council of Nairobi.

3.7 Support Services

The Studio shall contractually source outside caterers to cater for the needs of the
employees and the artists, according to the needs and the traffic of the job. Camera
Technicians, Video Vixens, and field technicians shall all be sourced according to the
particular needs at the particular time. The insiders themselves shall easily meet other needs
around the Housold.

CHAPTER FOUR: OPERATIONAL PLAN

The chapter shall detail the operational capacity and facilities to be used along with all the
necessary equipment that the Housold Studio shall use to carry business. The chapter shall
go ahead to outline an operational strategy it aims to employ in order to minimize on cost
while maximizing on profit. Costs of material together with the overhead costs projected to be
incurred every month shall be analyzed.

​ 4.1 Operational Facilities and Capacity

Facility Details
Machine #required capacity Cost/unit Total cost Supplies
Apple Mac
Book Pro 2 Core i7 275,000 550,000
Studio 13,000
Monitors 1 High power 13,000
Music mixer 1 Superior 50,000 50,000
Video
camera 1 HD 40,000 40,000
Microphones 5 Dynamic 40,000 40,000
Fire wire
recording
system 1 Brilliant 22,000 22,000

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Audio
Interface 1 Magnetic 7,000 7,000
XLR cables 12 Optic 12,000 12,000
Total 734,000
Table 4. 1 Summary for Business Requirements

​ Because the Housold Studio shall be a music making, music promotion, and music
distribution entity, the primary tools of trade shall be the studio tools and equipment. These
tools shall include the Microphones, the speakers, the camera, the sound mixer and the
musical instruments. The studio will acquire basic standard start up tools that required like
the computers, the music mixers, and the microphones. Additional equipment like transport
facilities for use during Studio road shows and public promotions shall be leased according to
the particular need of the time. The studio shall require furniture to hold its tools and these
shall be sourced from the carpenters in the locality. Other tools like cleaning equipment shall
also be acquired according to the need.

The office space

For a start, the business will operate inside the founders’ house. Later the business
will rent space in the middle of the CBD and below is an architect’s impression about how
the floor plan of the office space will look like.

4.1 1 Artist's Impression of the Floor Plan of the office

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 Above is an architect’s impression of the front office, the reception, and the
boardroom. The three departments of the Housold Studio shall carry out their strategic
meetings here and Auditions for the search for talent shall be carried out here. At the extreme
right end is the entrance to the business establishment. There shall be the lounge area where
guests shall be entertained as they wait to be served. The lounge area will open into the
corridor and along the corridors is the board room and the Vive Producer’s office. The
reception shall be automated most of the time because bookings and inquiries will be done
online. However, the PR Strategist will have his ears here just in case there is need for a
human agent.

The image below is an artist’s impression of the way that the space for the main
functions of the company will take place. The extreme left end of the picture shows the
Recording booths where the actual recording will take place. The three compartments visible
are little office spaces that shall be occupied by the Deputy Producer, the Executive Studio
Assistant, and the PR Strategist. The Radix office area is the place where short break sessions
will be carried out. Close to the cabinet is a door that leads to the washrooms and the kitchen
area.

Figure 7 Architect's Impression of the Recording space

4.2 Operational Strategy

​ The main manager of the business shall be the Vice Producer. The Vive producer shall
oversee the general running of the business. In the absence of the Vice Producer, the Deputy
Produces shall take charge. The Vice Producer shall be in charge of the Audio Production.
The Deputy Producer shall do everything concerned with the Video Production. The PR

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strategist shall be concerned with the relations within the Housold Studio. To minimize on the
cost of production, the offices of the Vice Producer, the Deputy Produces, the Executive
Personal assistant, and the PR Strategist shall all carry out duties additional to their Primary
Responsibility. The Vice producer shall also carry out functions of Audio Production. The
Deputy Producer is in charge of the Digital Promotion Unit and the Online Promotion of the
Housold Studio. The PR Strategist shall also carry out the Function of ensuring that the
salaries and remunerations of the Housold Studio are well taken care of. The Executive
Personal Assistant shall be in charge maintaining the image of the Housold Personnel.

​ As a studio that deals with art and the development of skills, Time is going to be the
biggest asset the Studio cannot afford to get wrong. In order to ensure the minimization of the
costs of transacting business, the Studio shall carry out massive production of music as
opposed to carrying out single unit music. The artists shall therefore be advised to produce
their music as an album as opposed to single tracks at a time. Producing an album at a time
will ensure that minimum time is used from one artist to the other and that enough of it is
invested in ensuring excellent quality of the product realized. Plenty of time will be invested
in doing research, in order to find the best practice possible according to every project. The
artists will work closely with the Executive Personal assistant; who in addition to providing
advises on the image of the artist will also put some financial aspect into the project.

​ Because the studio intends to use the latest technology, i.e., non-physical medium in
the distribution of its products, there will not be the traditional implications of purchasing
physical CDs. The studio will have Hard Disk Drives and online storage that will be used to
maintain its database, with no need for physical medium like record books. Most of the
studio’s interface will highly be automated, including the registration of artists and the
payment of salaries and remuneration. The Studio Shall be able to meet its own labor
requirements by the Personnel already in place. During special Occasions like Road shows
and “Talent Search Shows,” the studio shall source external talent according to the specific
needs. The following services shall however be sourced from one of the Studio’s Trusted
business partners once every month and to the heart of the audience.

Service Amount (Ksh)

Taxes 2,000
Studio equipment maintenance 2,000
Maintenance of hygiene 2,000

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Refreshments 2,000
Guest Entertainment 2,000
Electricity 2,000
Water 1,000
Total 13,000
4.1 2 Cost of Studio Maintenance and total Operational Cost

4.3 Operational Process

​ The artist shall be registered with the Studio. A demonstration of the ability to meet
the requirements of the studio as a show of the artist commitment to work with the
regulations of the Studio shall earn them the chance to be recorded by the studio. The studio
shall then reserve all the rights to the work of the artist as insurance for their continued
commitment to work with the studio. The artist shall be assigned a Lyric Composer and an
instrumentalist who will help in the composition of the music. The artist shall also be
assigned a music coach and a mentor who will help in the nurturing or the talent. Six months
of working with the Studio will earn the artist silver status. The Silver status is a level of trust
the Studio puts into the artist. One year makes the Silver Gold and two years make the Gold
Platinum. The continued effort of the artist will earn him a life membership in the studio and
this gives him the liberty to record music whenever they want. They get to become business
partners to the Studio, earning shares to the ownership of the studio by the amount of records
they are able to sell. Music will be manufactured from the composer’s mind to the artists’
mouth.

4.4 Regulations Affecting Operations

The Housold Studio shall operate under the Laws Governing the Production,
Distribution, and sale of music in the Republic of Kenya and beyond. Because the Studio will
engage in signing acts including artists from beyond the borders of Kenya, the PR Strategic
unit of the Business shall ensure that the international Business Partners acquire the right
documentations at the offices for immigration and are able to find their way into and about
the country, unharmed. The studio shall acquire licenses from the Music Copyright Society of
Kenya because it will be situated in the country and by virtue of being situated in the capital
city, the business shall also acquire zoning laws that apply to the county of Nairobi. The
Studio shall have a responsibility of paying taxes to both the national government and the
county government. By keeping aside 2,000 shillings every month, the studio shall be able to
meet its taxes requirement.

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 CHAPTER FIVE: FINANCIAL PLAN
This chapter shall show the finances available in the business, their allocations, and the way
they move in and out of the business. The chapter helps to determine shall endeavor to
determine whether the business operates at a loss or a profit.

5.1 Pre-Operational Costs

These are the cost incurred before the start of the business. The table below shows the
Pre-Operational costs.

Table 5.1 Pre- operational Plan

Item Amount (Ksh.)

Rent Plus 3 months deposit 120,000
Insurance 20,000
Advertising 30,000
Internet connection 10,000
Business permit 5,000
Web Hosting 2,000
Copyright 5,000
Machinery 734,000
Total 926,000

5.2 Working Capital Requirements

This is the total amount used in the daily operations of the business. It is usually the
total amount available less the pre-operational cost. The table below shows the estimated
working capital for the first three years.

Current Assets- Current Liabilities= Working Capital

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 Table 5.2 Working Capital

Item Year one

Amount available
(current assets) 2,000,000
Pre-Operational Cost (Current
Liabilities) 926,000
Working Capital
(Amount available) 1,074,000

5.3 Project Cash Flow Statement for Year One

The cash flow statement shall detail accounts of all projections of how the money
flows in and out of the business in terms of sales and purchases all through the year.

Item Jan Feb March April May June July Aug Sept Oct Nov Dec

Cash in

0 786 1578 2370 3172 3978 4790 5602 6419 7237 8056 8880
Opening Bal.
Cash sales
1074 1080 1080 1090 1094 1100 1100 1105 1106 1107 1112 1115
Total Cash In 1074 1866 2658 3460 4266 5078 5890 6707 7525 8344 9168 9995
Cash out

220 220 220 220 220 220 220 220 220 220 220 220
Salaries and wages
Electricity 2 2 2 2 2 2 2 2 2 2 2 2

Water 1 1 1 1 1 1 1 1 1 1 1 1
Rent 30 30 30 30 30 30 30 30 30 30 30 30
Internet 10 10 10 10 10 10 10 10 10 10 10 10
Miscellaneous 5 5 5 5 5 5 5 5 5 5 5 5
Insurance 20 20 20 20 20 20 20 20 20 20 20 20
Total cash out 288 288 288 288 288 288 288 288 288 288 288 288
Net Cash Flow 786 1578 2370 3172 3978 4790 5602 6419 7237 8056 8880 9707
*NB: all the values above represent thousands of Ksh.

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5.4 Preparation of Pro-Forma Income Statement
Item Year 2016
Sales 13,163,000
Cost of services 3,456,000
Gross Profit 9,707,000
Expenses
Wages and salaries 2,640,000
Rent 360,000
Water 12,000
Electricity 24,000
Insurance 240,000
Licenses 192,000
Advertising 40,000
Repairs and maintenance 24,000
Miscellaneous 60,000
Total expenses
3,592,000

Net Profit before Tax* 9,707,000

Net Profit after Tax 8,153,880

*tax – 16%

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5.5 Pro-Forma Balance Sheet
Item As at opening
date
Assets:
Current assets 926,000
Cash 677,000

Total Current Assets 1,603,000

Fixed assets:
Equipment cost 734,000
Vehicles 615,000
Furniture and Fittings 400,000

Total Fixed Assets 1,749,000

Total Assets 3,352,000

Liabilities
Current Liabilities 734,000
Other Liabilities 292,000
Total Liabilities 926,000

Total Liabilities and Equity 3,352,000

5.6 Calculating the Breaking Even Point

For the first month of operation

Step 1: calculating the total contribution margin

= sales – variable costs

​ 1,074,000- 288,000= 786,000 Ksh

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 Step two: calculate the contribution margin percentage

(Total contribution margin/sales)*100%

​ (786,000/1,074,000)*100%

​ =73.184%

Step 3: determine the total fixed cost or operational costs

​ 288,000 Ksh

Step 4: calculate the breakeven levels of sales

= fixed costs/contribution margin percentage

​ (288,000/73.184)

​ 3935.2863 Ksh

5.7 Expected Profitability Ratio

1. Gross Profit Percentage

= (Gross Profit/sales)*100%

(9,707,000/13,163,000)*100

73.74%

2. Return on Equity

(Net profit after tax)/Owner’s Equity* 100%

(8,153,880/2,000,000)*100%

407.69%

3. Return on Investment

= Net Profit after tax/Total investment* 100%

(8,153,880/2,000,000)*100%

407.69%

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5.8 Desired Financing
Item Amount

Pre-Operational Costs 926,000

Working Capital 1,074,000

Fixed Assets 734,000

Total 2,734,000

5.9 Proposed Capitalization

Item Amount

Owners’ Equity 1,400,000

Personal Savings 200,000
Contributions from family and friends 400,000

Total 2,000,000

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 CHAPTER SIX: RISK PLAN
This chapter details the risks the business is likely to face in the course of operation and shall
propose measures that will come in handy to counter the effects of those risks in order to keep
the business running smoothly un-abated.

The running of a business entity does not go without its own measure of challenges and risks.
At the Housold Studio, the following are the risks that are likely to befall the company.

1.​ Risks of finances

Financial risks are the types of risks that touch on the finances of the business
operation. They range from the misuse of the finances of the business, to fraud, to low sales
and even misuse of the finances of the business. In order to ensure that such losses are
averted and sufficiently dealt with, the Housold Studio shall charge the PR Strategist with the
duty of ensuring that all the finances are properly taken care of by the use of up to beat,
effective electronic skills of bookkeeping. The financial statements will from time to time be
reviewed in order to keep up with the day to day operation of the business. The Financial
Controller of the studio shall make these reports on a regular basis to the Vice Producer, who
shall at his own judgment convene board meetings to discuss the progress of the business. On
the part of the sales, the studio shall employ the use of effective and aggressive marketers to
see to it that the studio has several major projects running every other time.

2.​ Social Cultural Risks

The Housold Studio is Product of the Kenyan society first before it is an international
brand operating over the internet. For the reason of cultural clashes, it is expected that there
would be factions of the population that might not culturally approve of some aspect of the
Record Labels’ venture, maybe the style of music or the modes of product promotion.
Because the Housold is an entertainment as well as communicator of media messages, it is
fundamental that the messages that come out of the company are accommodating to as many
factions of the community in which they operate as possible in order to promote the business
as a brand and to conduct our business in the most transparent manner. The Studio shall
therefore, as part of Social Corporate Responsibility, prepare messages that expound on the
role of Music to the society and the Unifying factor that it plays. In line with creating music
that appeals to the whole “house-Hold,” the Housold Studio shall endeavor to piece back
together the facets of the society that are seemingly falling apart by using the power of music.

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3.​ Ecological Risks
Ecological risks are those that relate to the Geographical location of the business.
Ecological risks also include the role the business is likely to play in the environment around
which it is located. Housold Studio shall initially be located within the residence of the sole
proprietors’. In addition, the studio, being a music making entity that mainly deals with
Music Making, Music Distribution, and Music Promotion, will hardly incur any waste
products as waste materials. The business will use the latest technology of music production
and Distribution, which entails wiring the digital music copies online without necessarily
incurring any physical infrastructure like the plastic CDs as it were in the past. The only
challenge that remains is for the part of dealing with noise pollution due to the loud studio
sessions that will be characteristic of the Music studio. The pollution of noise shall however,
ably be dealt with by the use of efficient noise absorbers that shall be incorporated into the
infrastructure of the Studio Building.

4.​ Legal Risks

Because the Housold Studio will directly interact with legal issues like copyright of
the music and will need to seek legal advice from time to time in order to deal with the
matters concerning the laws of the country of operation the Studio shall hire the services of
Legal experts from time to time according to the need. As one of the business partners, the
company shall get into a partnership with one of the leading Legal Firms in the world of
entertainment and shall work closely with the firm to ensure that matters concerning the law
are adhered to.

5.​ Technological
The General trend the world over in terms of technology is that there will always be
need to move from good to better one time or another. Being a company that deals with
products that are mainly consumed via the use of technology, the Housold Studio shall create
an infrastructure to ensure that the company keeps up with the new and the emerging trends
of technological advancements in the market

6.​ Economical and Industrial risks

Because it is inevitable that the economic climate of any business changes from time
to time, the Housold studio will at most maintain a slim workforce in order to cut down on
expenses and have the three arms of the business handle as much work as is reasonably
possible without risking poor performance and below par standard of work.

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