|5||The Profit and Loss Statement|
Profitability … or the lack thereof!
Record companies use profit and loss (P&L) statements to both predict the success of a record prior to its release as well as analyze a project as it nears the end of its lifecycle. To understand the “math,” let’s look at all the components of a P&L, recognizing the financial significance of every line item.
SRLP …suggested retail list price
The suggested retail list price (SRLP) is set by the record label and is based on cost of the recording project, the artist’s status, genre of music, competitive landscape, and what the market will bear. Although the royalty models are changing, many labels still pay artist royalties based on the SRLP. The SRLP has a correlating ...