The essence of the business project called «commercial radio station» is to earn money by selling advertising time.
The highlight of this business is that the main product produced (interesting radio programs) is distributed to everyone for free, and it is sold — advertising time.
To spin the magic wheel that attracts advertisers, you need a well-thought-out business — a radio station plan, initial capital, determination and a little luck.
Radio station business plan: where to start?
Consider the main steps that need to be taken to implement the business plan of the radio station:
1. Determine the format of the radio station
The first step is to choose the idea and format of the radio station, to determine the target audience. This is an essential point. Future profit and payback period will largely depend on it.
2. Register a legal entity
It is necessary to acquire the status of a legal entity in order to obtain a broadcasting license. At this stage, it is important to choose a beautiful name for your company and correctly indicate the types of activities.
3. Collect the necessary documents for starting a business
You can go through this step on your own. To avoid difficulties in coordinating with the Research Institute of the Ministry of Defense, it is better, although more expensive, to use the services of a subsidiary of the Main Radio Frequency Center.
4. Get broadcast frequency
It will be possible to obtain the conclusion of the GRFC with your broadcast frequency only if there are free frequencies in the range from 87 to 108 MHz. Otherwise, you will have to work on the development of the broadcasting frequency.
5. Develop a broadcasting frequency
This procedure is relatively simple for smaller communities. If the population covered by the broadcast exceeds 200,000 people, a broadcast competition will be announced.
This competition is held twice a year. Its cost depends on the region and the scale of broadcasting, and can reach $400,000 or more for large cities.
Of the unpleasant surprises that may await you at this stage, the contest may be won by a company that has appeared from nowhere and is not going to broadcast in your region at all.
In this case, you will only have to rent the frequency, and these are significant fixed costs that can significantly increase the cost of the business.
6. Media registration
Before registering the media, you must choose a unique, sonorous, immediately memorable name of the radio station.
In general, it may not coincide with the name of a legal entity, but it must be easy to pronounce and intrigue, attracting the attention of a potential listener.
The registration certificate is issued at the territorial office of Roskomnadzor, or at the central one, if broadcasting will be conducted in several regions, in the border zone.
The certificate will be issued after passing a 30-day name verification for uniqueness.
An important point: If broadcasting is not started within a year, the certificate may be cancelled.
Issued in the same department of Roskomnadzor as the certificate.
To obtain it, you need a package of documents with the concept of broadcasting the radio station and a cover letter.
We obtain a license for communication services for on-air broadcasting and a permit for the use of radio frequencies in the same place by submitting a package of requested documents.
Permission to use the frequency is issued for a period of 10 years.
Conclusion of a contract for retransmission with a network station
It is necessary at first to fill the air with interesting information and attract the listener.
Selection of premises, purchase and installation of equipment, registration of the transmitter
The main steps to launch a radio station include:
- search and rent of premises;
- purchase of equipment;
- transmitter registration;
- installation and testing of the transmitter and equipment;
- the beginning of a full-fledged work.
Radio station business plan: financial part
Without taking into account the estimated costs, it is impossible to draw up and implement a successful business — a radio station plan. But it is not possible to accurately take into account all the costs and expenses, especially with the floating exchange rate of the ruble.
So let’s evaluate:
- Registration as a media — $ 1,500;
- Payment for the contract for the retransmission of a network station — 5000-6000 dollars per 100,000 population;
- Frequency development — 20,000-150,000 dollars, depending on the power and region of the transmitter broadcast;
- Harmonization of the nominal frequency — 25,000-300,000 dollars;
- Competition fee — from $ 250,000 in cities up to 500,000 people, up to $ 30,000,000 in Moscow;
- License fee — 30 — 50 minimum salaries. Paid in cases where there is no competition (population less than 200,000);
- Studio equipment — about $ 100,000;
- Transmitting equipment — about $ 500,000;
- Certification — up to $30,000;
- Advertising, salary, utility bills, etc.
As you can see, the spread of even estimated figures is very large. On average, for 400,000 cities, the amount will be about 2.5 million dollars.
Radio station business plan: project payback
The average payback period will be from one to several years, subject to the right choice of name, format, staff, active advertising policy and proper work with investors.
What should be paid special attention to
In addition to the above, you should pay close attention to the start advertising. By the time the first broadcast goes on the air , most potential listeners should know about it .