How much to charge for beats

When you make beats for sale, your price should be driven by several factors. This article will help you understand what things you need to consider before charging someone for beats you make.

Exclusive or not

First you need to determine if you want to license a beat exclusive or non-exclusive. Exclusive means you will sell the beat to only one buyer. Non-Exclusive means you will sell the beat to many. On the surface you might thing that the non-exclusive is always better since you can sell it more times, but generally you don’t get to charge as much.

A typical non-exclusive beat might go for $20 while an exclusive beat might go for $100. This is assuming your average non famous and non established beat maker.

So the math tells us that when you make beats and sell them non exclusively for $20 you need at least 5 buyers to equal one exclusive sale. The reverse to this is that you need to find one buyer willing to spend $100 on a beat. Obviously there will more people with $20 to spend than $100.

Non-exclusive Beats

To make beats for non exclusive sale, is the same as any other type of beat making. In other words you don’t necessarily hold back any of your talent just because you will be charging less. You do need to consider the pricing formula. Price your beat too high and you don’t get a lot of borrowers, price it too low and you don’t make top dollar.

Remember that lower prices will give you more potential customers. This is the tricky part. Consider the following three scenarios:

1. A $10 beat might get bought by 10 people = $100 profit.
2. A $25 beat might get bought by 4 people = $100 profit.
3. A $50 beat might get bough by 2 people = $100 profit.

All scenarios yield the same profit, but consider your customer base and competition. If you are the only one in your area making beats for the local rappers, then $50 is probably your price point. If you’re selling your beats online as an unknown, the $10 might be more reasonable. If you try to sell $50 beats online as an unknown,  you might get zero sales.

Also consider the non beat making work involved. License agreements, paperwork, personalities, etc. It would be much easier to deal with 4 people at $25 than 10 people at $10.

But when you are starting out, you need to test the waters, so price your beat where you feel it’s fair. If you don’t get any buyers for your beat, try lowering the price. Never publicly lower the price on a beat you have already sold to someone else that’s bad business. If someone bought a beat from you for $15 and now he sees you have the same beat on “sale” for only $5, he’s likely not to return to you for beats.

Remember that once you sell your beat under a non-exclusive license, you can never sell it exclusively.

Exclusive Beats

To make beats for exclusive sale, you have to be sure that you are willing to let only one person use the beat. Most commercial artists will never buy a beat that is not exclusive. Generally you might want to start your best beats out as exclusive licenses. Remember that you should charge at least 4 times your non exclusive price.

Because the price is higher, your potential customers are lower in number. If it doesn’t sell, you can bump it down to a lower price and/or non-exclusive.

Everyone would love to make a beat and sell it for a lot of money, but in reality, there are a lot of beat makers with the same idea. Eventually all professional beat makers will be selling exclusive licenses only.

Be humble and start small. You might even give beats away to rappers or groups you think have big potential. If they are looking for a deal by sending their demo out with your beats, that’s better for you if the record companies hear a single in it.

The great part is, once you sell your your first beat, even it’s for $1, you are technically a professional beat maker!