How to Start a Jingle Company

Start a jingle company by following these 10 steps:

1. Plan your Jingle Company
2. Form your Jingle Company into a Legal Entity
3. Register your Jingle Company for Taxes
4. Open a Business Bank Account & Credit Card
5. Set up Accounting for your Jingle Company
6. Get the Necessary Permits & Licenses for your Jingle Company
7. Get Jingle Company Insurance
8. Define your Jingle Company Brand
9. Create your Jingle Company Website
10. Set up your Business Phone System

We have put together this simple guide to starting your jingle company. These steps will ensure that your new business is well planned out, registered properly and legally compliant.

Exploring your options? Check out other small business ideas.

STEP 1: Plan your business

A clear plan is essential for success as an entrepreneur. It will help you map out the specifics of your business and discover some unknowns. A few important topics to consider are:

• What will you name your business?
• What are the startup and ongoing costs?
• Who is your target market?
• How much can you charge customers?

Luckily we have done a lot of this research for you.

What will you name your business?

Choosing the right name is important and challenging. If you don’t already have a name in mind, visit our How to Name a Business guide or get help brainstorming a name with our Jingle Company Name Generator

If you operate a sole proprietorship, you might want to operate under a business name other than your own name. Visit our DBA guide to learn more.

When registering a business name, we recommend researching your business name by checking:

• Your state's business records
• Federal and state trademark records
• Social media platforms
• Web domain availability.

It's very important to secure your domain name before someone else does.

What are the costs involved in opening a jingle company?

Frequent communication is essential, so providing clients with a number of channels to accommodate their personal preferences, such as telephone, text, and email is important. You’ll also need a powerful computer with enough storage space for large files and dependable internet access. Many invest in relevant software programs as well. As an alternative to renting a sound studio with equipment, you can purchase sound mixing equipment, musical instruments and microphones and create a music studio in your home. Depending on the price of real estate where you live, the savings can be substantial.

What are the ongoing expenses for a jingle company?

Ongoing expenses include utilities, equipment maintenance, and salaries for freelance musicians, sound engineers, and singers. (Many larger companies require the use of union workers.) Since calculating fees and royalties can be complex, having a good tax accountant on retainer is a wise investment as well.

Who is the target market?

Preferred clients are individuals or companies who wish to purchase original music, usually for promotional purposes.

How does a jingle company make money?

Depending on the terms of the contract, jingle company owners can make money by earning royalties on original music that is used on television shows or during other theatrical performances. The amount of the royalties depends on factors such as the length of the piece and how it is used. Some writers share their royalties with publishing companies, while others publish their own work. Works can also be sold for a one-time fee. This method is most typical with lesser known jingle writers, as the hiring agencies usually have more leverage.

How much can you charge customers?

Professional jingle writers have been known to earn over $20,000 for writing and arranging a single project. How much you can charge depends largely on the size of your client’s budget, your reputation as a jingle writer, how the music will be used, and how often. Earned royalties can be substantial over time. However, most new jingle company owners charge very little and even provide free demos of their work until they have a substantial list of credits. $500 to $1500 is considered a reasonable fee for an original song for a commercial. The fee for writing a simple jingle for a small company website can be as little as $250.

How much profit can a jingle company make?

Musical composers make an average of $44,000 per year, while writers make an average of $60,000. Jingle writers usually combine both talents and work closely with advertising agencies. Digital advertising for smartphones has become a lucrative new market. In 2011, one digital advertising company sold for $62.5 million.

How can you make your business more profitable?

Registering your work with the copyright office can make your business more profitable by giving you legal recourse in the event that there is any unauthorized use of your work. In addition to television commercials, movies, and radio ads, there are other types of businesses that require original music—the composition of which is a skill most jingle writers have. One example is the video game industry. Most video games have musical accompaniment or a soundtrack. Smartphone companies also offer hundreds of musical ringtones, many of which have become wildly popular. Even small businesses that can’t afford to purchase television or radio ads can have the benefit of an original jingle on their websites to help build their unique brand. In this business, increasing the success of others increases your own as well.

STEP 2: Form a legal entity

The most common business structure types are the sole proprietorship, partnership, limited liability company (LLC), and corporation.

Establishing a legal business entity such as an LLC or corporation protects you from being held personally liable if your jingle company is sued.

You can form an LLC yourself and pay only the minimal state LLC costs or hire one of the Best LLC Services for a small, additional fee.

STEP 3: Register for taxes

You will need to register for a variety of state and federal taxes before you can open for business.

In order to register for taxes you will need to apply for an EIN. It's really easy and free!

There are specific state taxes that might apply to your business. Learn more about state sales tax and franchise taxes in our state sales tax guides.

STEP 4: Open a business bank account & credit card

Using dedicated business banking and credit accounts is essential for personal asset protection.

When your personal and business accounts are mixed, your personal assets (your home, car, and other valuables) are at risk in the event your business is sued. In business law, this is referred to as piercing your corporate veil.

Open a business bank account

Besides being a requirement when applying for business loans, opening a business bank account:

• Separates your personal assets from your company's assets, which is necessary for personal asset protection.
• Makes accounting and tax filing easier.

Get a business credit card

Getting a business credit card helps you:

• Separate personal and business expenses by putting your business' expenses all in one place.
• Build your company's credit history, which can be useful to raise money later on.

STEP 5: Set up business accounting

Recording your various expenses and sources of income is critical to understanding the financial performance of your business. Keeping accurate and detailed accounts also greatly simplifies your annual tax filing.

Make LLC accounting easy with our LLC Expenses Cheat Sheet.

STEP 6: Obtain necessary permits and licenses

Failure to acquire necessary permits and licenses can result in hefty fines, or even cause your business to be shut down.

State & Local Business Licensing Requirements

Certain state permits and licenses may be needed to operate a jingle company. Learn more about licensing requirements in your state by visiting SBA’s reference to state licenses and permits.

In particular, may require jingle companies to obtain a seller’s permit. A seller’s permit enables states to record and collect taxes from goods (and sometimes service) sales.

Services Contract

Jingle companies should require clients to sign a services agreement before starting a new project. This agreement should clarify client expectations and minimize risk of legal disputes by setting out payment terms and conditions, service level expectations, and intellectual property ownership (who will ultimately own the composition--usually the company producing the ad). Here is an example of one such services agreement.

Recommended: Rocket Lawyer makes it easy to create a professional service agreement for your jingle company when you sign up for their premium membership. For $39.95 per month, members receive access to hundreds of legal agreements and on call attorneys to get complimentary legal advice.

Music Licensing

Jingle writers will need to register with a PRO, such as ASCAP or BMI, to ensure their music is copywritten, and to ensure payment will be properly disbursed.

• Learn more about music licensing requirements

STEP 7: Get business insurance

Just as with licenses and permits, your business needs insurance in order to operate safely and lawfully. Business Insurance protects your company’s financial wellbeing in the event of a covered loss.

There are several types of insurance policies created for different types of businesses with different risks. If you’re unsure of the types of risks that your business may face, begin with General Liability Insurance. This is the most common coverage that small businesses need, so it’s a great place to start for your business.

Another notable insurance policy that many businesses need is Workers’ Compensation Insurance. If your business will have employees, it’s a good chance that your state will require you to carry Workers' Compensation Coverage.

Is this Business Right For You?

This business is ideal for musically creative people who enjoy using their talents to promote business ventures.

What happens during a typical day at a jingle company?

The daily activities of a jingle company owner are varied and can include:

• Musical composition and lyric writing
• Networking with industry professionals
• Brainstorming and project collaboration
• Interviewing musicians, composers, and sound studio personnel
• Contract negotiations
• Obtaining a copyright for original musical works

What are some skills and experiences that will help you build a successful jingle company?

Some of the skills it is most important to have in this business include:

• The ability to read music and play an instrument
• Extensive knowledge of music history for reference
• Sound studio experience to mix and enhance music
• Effective listening and communication skills for understanding the specific needs of clients
• Negotiation skills for creating contracts
• Knowledge of copyrighting and licensing requirements

What is the growth potential for a jingle company?

The growth potential for a jingle company varies according to the size of the team. Some have composers and musicians on retainer to be better able to meet multiple deadlines for multiple clients simultaneously.