Business Ideas | Small Business Ideas: Start Your FM Radio Station Business

Monday, March 3, 2014

Start Your FM Radio Station Business | How to Start a Radio Station Business

If you want to start a FM Radio Station Business, you will need to pick the ideal location, secure the requirements for the permits and licenses, shop for the equipment, and attend to other matters of the business.

You may need to hire a DJ or you can opt not to have one. Have business plan so that you can have some sort of guide in the operations.

Do you love listening to the radio? Well, this is an excellent business opportunity for those who have the passion for radio service. Even if you don’t have much experience with radio jobs and tasks, you can easily gather the needed info on the web so that you can also familiarize yourself with the different equipment and tasks. Your very first task is to get the necessary license. You can inquire at the Federal Communications Commission for the application requirements. This will usually include the FCC Form 605 and the passing certificate that will be issued by COLEM or the Commercial Operator License Examination Manager.

What do you want? Radio stations vary. You can focus on playing music or in broadcasting news. To make sure that you’re following the right path, you will need to come up with a plan. Create your own business plan. Having a radio show can be costly because you will need someone on the air all the time whereas if you simply play music, you can save some money. With the advances in technology, it is now possible to run a radio station that plays music (e.g. oldies, top hits, etc.) even without a disc jockey. Come up with a unique and easy to remember name for your radio station. For instance, you can use at least 3-4 letters plus the frequency so that your potential listeners can easily identify it.

You will need to get equipment for the station and have it installed. You can shop around if you like so that you can get the best deals. If you still want to hire DJs, you may do so as long as your operating budget permits. Don’t forget to hunt for sponsors. Advertising can help your radio station stay afloat but just make sure that you pick the ads carefully. To ensure that your listeners will stay loyal to your station, you can have contests and quizzes where they can win money or special prizes. You must do this often so that people will stick to your station.

Allow listeners to call your station and make requests. Try to play all the requests because this is also another way of promoting your radio station. You may need a DJ for this tactic so that the phone calls can be answered. It’s not that hard to start a radio station as long as you’ve secured the needed permits and licenses. Find a suitable location and start investing now.

Radio

Radio is the transmission of intelligence by modulating waves of electromagnetic radiation at specific frequencies. Radio signals move at the speed of light and are said to travel over the air.

Radio Broadcasting

A broadcast is the one-way transmission of program content intended to reach a mass audience. Radio programs transmitted over the air are said to be on the air. Broadcasting of audio to mass audiences also is accomplished via streaming media on the Internet, cable, local wire networks and satellites.

Radio Station

A radio station transmits information and entertainment programs to a mass audience, either over the air or via streaming media.

Radio Network

Radio stations can be linked together as networks to broadcast a common program content.

AM Radio

Amplitude modulation (AM) is a means of encoding audio on an over-the-air radio transmission. AM stations are known as standard broadcast stations because AM was the first form used to broadcast signals to the public. AM stations also are known as mediumwave stations. To restrict signals to local areas, more than half of all AM stations in the U.S. are daytime stations or stations allowed to transmit only low power at night. In the U.S., standard AM broadcasts are in the frequency range 535 kHz-1.7 mHz.

FM Radio

Frequency modulation (FM) is a means of encoding audio on an over-the-air radio frequency transmission. FM full power, low power, translator and booster stations transmit in the 88-108 MHz frequency range. Only non-commercial educational radio stations are licensed in the 88-92 MHz frequency range. Commercial stations and non-commercial educational stations operate in the 92-108 MHz range. FM radio became more popular than AM because of its noise-free reception.

Low Power FM Service

An LPFM radio station uses a low transmitter power to broadcast an FM signal over short distances. They are used mainly by educational institutions and some public safety travelers information groups.

How to Start a FM Radio Station Business

The radio business is highly competitive and fluid. Prepare to invest yourself in your radio business goal with commitment and energy. Multiple factors you must address include, but are no limited to, start-up and operating capital, market and demographics, Federal Communications Commission (FCC) licensing, format, band positioning and/or Internet presence, and talent. All radio business development hinges on an FCC license.

Instruction:

Step 1

Develop a radio station business plan. Components of a business plan include, but are not limited, to an executive summary, a strategic focus and a market product focus. Information relevant to a radio station business plan includes analysis of radio market competition, which affects your strategic plan and market demographics. In the latter case, radio station formats--country, classical, alternative--appeal to particular target groups, such as males, 18-34. Your advertising strategy will target the relevant demographic group(s).

Step 2

Apply for an FCC license. Begin the licensing process by registering with the Universal Licensing System (ULS). Use login information to apply for a new FCC license. ULC recommends this first step to discover if there are any limiting factors, such as frequency availability.

Step 3

Raise startup and operating capital. Sources of capital include personal funds, investors and business loans. Prepare to present your FCC license and your business plan to loan officers and investors. If you lack funds or resources for funds, Familypsalms.com, an online radio startup consortium, advises to start slow and scale up as your station becomes financially viable.

Step 4

Arrange for studio and transmission equipment. Transmission equipment includes, but is not limited to, electronic hardware and component parts and accessories. Radio production facilities require equipment, such as audio chain equipment, including microphones, audio recorder and console, and signal processing equipment.

Step 5

Establish the station format. Research the Houston radio market. As of 2010, for example, the Houston metro area radio market includes country, alternative and Spanish stations, to name only three. The format you choose should be competitive with existing stations or fill a need in Houston not currently met.

Step 6

Hire appropriate talent. Choices for talent depends on your station's format. If, for example, you offer your community a news-oriented format, air talent must be media journalists. Competitive salaries for talent reflect the size of the market--small, medium or large--in which your station is located.

Step 7

Read Arbitron ratings for the Houston metro area. Arbitron is the gold standard for ratings. Ratings will tell you how Houston radio stations rate with listeners in demographic ranges from 12 years and older. Arbitron offers Market Survey & Population Rankings (Blue Book) with Houston market numbers.

Things Needed

Tips

Internet radio stations offer affordable options for startup stations.
Look at what entities, such as Clear Channel, Cox, Univision, own properties in the Houston market. This information will tell you the level and nature of the competition you will face.

References (7)

Resources (4)

About the Author

Alyson Paige has a master's degree in canon law and began writing professionally in 1998. Her articles specialize in culture, business and home and garden, among many other topics.

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1 comment:

FM Radio StationMarch 3, 2014 at 6:30 PM
FM Radio Station, How to Start a Radio Station Business, Radio Station Business, Start Your FM Radio Station Business
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Easy Tips and Ideas to Start Business

Although anyone can start a business, many people fail because of a bad product or improper research. If you want to start your own business, you can improve your chances for success before you even begin. In order to make your business successful, start strong and make sure that your idea will hold out for the long haul.

Have a Good Product

Ensure that you plan to sell something useful. Although you may think that your product is important or special, that doesn't mean the general public will agree. Ask friends, family and strangers what they think of your product. If they don't seem that interested, ask them why. With their suggestions, you can either improve the product or scrap the idea completely. According to Brad Sugars of Entrepreneur magazine, most small businesses fail because they sold a product that didn't have an adequate market. This also applies to small businesses that provide a service. A lawn-care business might be useful for part of the year in a northern state, but it is in-demand year-round in the south. Consider whether people will actually want to use your service and get constructive advice from those not afraid to give their opinion.

Research Local Businesses

Research local companies before starting up your own business. This will not only give you an idea of the amount of competition you will have, but it will also help you price your product or service. If you're looking to start a wedding photography business, you may find during your research that the market is over-saturated in your area. If not over-saturated, you should contact each business and ask them for a price list. Alter your prices so you can stay competitive with the competition in town. Researching similar local businesses will also help you decide where to locate your business location. Try not to start up a store or office close to another business of your type. If your small business is located away from similar business types, this will cause locals to choose you over businesses that are farther away from where they live.

Get Professional Advice

You may know someone who has started their own successful business. Ask him for advice and listen to his stories of how he started his company. You may gain useful advice on the good and bad ways to start a business. Local entrepreneurs can also introduce you to local product providers or advertisers that you may not have met without their help. Accept any advice with open arms, especially if the advice is coming from someone successful in the area.

How to Calculate Business Start Up Costs

Starting a business in no easy endeavor. It takes a great deal of research, perseverance and hard work. While sweat equity will make your small business more successful, you will most likely need real capital to get the business started. Before you start raising capital and/or investing your own funds, the first thing you need to do is determine the total start-up costs.

Step 1

Determine your costs of sales. For most small businesses this means inventory, the cost of raw materials, manufacturing equipment, shipping, packaging, and warehousing. However, not all businesses sell products. In this case, the cost of sales is primarily the direct labor involved in making the sale. For example, to open a small shoe business entails purchasing enough inventory ($10,000) to stock the store.

Step 2

Determine professional fees. Planning your business structure, i.e., limited liability corporation or general partnership, means hiring an attorney. There may also be the need to pay an attorney for help with establishing trademarks, copyrights, and patents. In this scenario, that puts total professional fees at an estimated $20,000.

Step 3

Determine technology costs. Technology can greatly reduce the cost of labor for small business if used effectively. Most small businesses require computers, printers, cell phones, website development, Internet access, software applications, information security, data storage, and outsourced information technology (IT) consulting. If the cost of technology is $10,000 to start, add an additional $5,000 a year for maintenance (hint: maintenance is not included in start-up costs).

Step 4

Determine administrative costs. This varies with business types and may include items such as business insurance, office supplies, product packaging, parking, rent, express shipping, desks, chairs, fax machines, phones, or anything else necessary to operate the business daily. A good estimate for start-up administrative costs would be $5,000 for the first six months.

Step 5

Determine initial sales and marketing costs. Now that you have your product, you need to let folks know about it. Sales and marketing costs generally include marketing materials for presentations, printing stationery, business cards, advertising, trade show events, and public relations. These initial sales and marketing costs can add up to $3,000.

Step 6

Determine the wages and benefits needed to secure a staff. This includes employee salaries, benefits, workers compensation, and payroll taxes. Let's put the cost of wages and benefits estimated at $20,000 for the first three months of business.

Step 7

Add all costs associated with starting the business for a total. Be sure to only include business start-up costs that will be incurred in the first three to six months of operations. For this example, the calculation is: $10,000 + $20,000 + $10,000 + $5,000 + $3,000 + $20,000 = $68,000.

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