Do you want to start a radio station business at home? If YES, here is a detailed guide on how to start a radio station for FREE with no money or experience plus a sample radio station business plan template. Over the years, radio is known to be one of the companions of a large number of people scattered all over the globe.
This is so because unlike the Television, radio stations can easily be connected to, with a simple device that you can carry around; the device could be a transistor radio, mobile phone or any internet enabled device et al. Radio broadcasting can be defined as a one-way wireless transmission over radio waves that can be far reaching- covering a wider audience.
In the united states of America, just as it is in most part of the world, radio broadcasting is indeed a major mass medium; servicing millions of Americans on a daily basis. Although the invention of the television in the 1950s contributed to a decline in the number of people that listen to radio stations daily, but with diversification by radio stations, they were able to regain some of the listeners that totally abandon radio for television.
In recent times, radio stations have becoming more creative and designing programs that can help them maintain a robust audience. This is important because the larger the number listeners you have glued to your radio station, the more juicy the commercial advertisement sponsorship you can attract.
Table of Content
- What Does It Take to Start a Radio Station?
- 2. Conduct Market Research and Feasibility Studies
- 3. Decide Which Niche to Concentrate On
- 4. Know Your Major Competitors in the Industry
- 5. Decide Whether to Buy a Franchise or Start from Scratch
- 8. Discuss with an Agent to Know the Best Insurance Policies for You
- 9. Protect your Intellectual Property With Trademark, Copyrights, Patents
- 10. Get the Necessary Professional Certification
- 11. Get the Necessary Legal Documents You Need to Operate
- 12. Write a Business Plan
- How Much Does It Cost to Start a Radio Station?
- 13. Raise the Needed Startup Capital
- 14. Choose a Suitable Location for your Business
- 15. Hire Employees for your Technical and Manpower Needs
- 16. Write a Marketing Plan Packed with ideas & Strategies
- 17. Develop Iron-clad Competitive Strategies to Help You Win
- 18. Brainstorm Possible Ways to Retain Clients & Customers
- 19. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
What Does It Take to Start a Radio Station?
If you are looking towards starting your own radio station In the united states of America, you would need a license and a permit from the FCC. It is illegal to run a radio station in the United States without following due process. It is important to state that in the United States, potential applicants for radio license are always in heavy demand.
The Federal Communications Commission (FCC) stated on their website that loads of people are applying to start their own radio stations in the U.S. For instance; a few years ago, the Commission received approximately 30,000 inquiries in a year from people who wanted to start a radio broadcast station.
Hence the demand for radio broadcast stations license and permit has grown while the amount of available spectrum has declined. Which is why when application filing window periods open for new radio stations, many competing applications are filed.
If you are looking towards sending in applications to the Federal Communications Commission (FCC), you should be aware at the outset that the filing of an application does not guarantee you will receive a broadcast station construction permit.
As a matter of fact, in many areas of the country, no frequencies may be available on which a new radio station could begin operating, without causing interference to existing radio stations. So, before going into setting up your facility and purchasing equipment for your radio station, ensure that you first of all secure a radio construction permit from the appropriate authority; the Federal Communication Commission(FCC) office close to you.
20 Steps to Starting a Radio Station from Home
1. Understand the Industry
The total number of radio stations in the United States of America as of 2009 was 3,494 and the number has grown beyond that in recent times. Statistics has it that American radio stations generated a total revenue of about 15.1 billion U.S. dollars in 2012 and out of the total revenue generated within the said period, an estimate of 510 million U.S. dollars was generated via online platforms. In 2009, there were 3,494 radio broadcasting stations in the United States.
Interesting Statistics About the Industry
In the United States of America, well over 90 percent of the people listen to radio one way or the other. It is on record that radio reaches well over 68 percent of U.S. consumers ages 12 and older on an average day and 236 million people listen to the radio each week. Global radio advertising expenditure is about $35.25bn and radio advertising expenditure in the United States of America is about $15.6bn.
Close to one fifth of Americans are exposed to radio programming while shopping, which is why radio stations will continue to attract adverts sponsorship from corporate organizations, religious body and the government et al. It is perhaps one of the most potent medium to reach out to a larger percentage of Americans. These are the percentage on where Americans to radio; Car – 42%, Home – 24%Work – 21%and other medium – 13%.
The majority of radio stations in the United States run their programs in English language. The second language used by radio stations in the United States is Spanish; this is so because Spanish language is the second most spoken language in the U.S.
Other national radio stations in the United States may decide to run their radio stations in a language that can be easy for them to communicate to their audience. That is why you can listen to radio stations that operate fully or partially in a wide variety of languages such as Russian, French, German, Italian, Portuguese, Chinese and Korean et al.
It is safer to say that the radio industry is saturated, but that does not stop more entrepreneurs from venturing into the industry. The truth is that, if not for the advent of the internet, there would have been a sharp decline or stagnancy in the growth of radio stations in the United States of America.
With the internet, it is now easier to set – up a radio station unlike the stress involved when applying for a radio frequency from the Federal Communication Commission – FCC.
People are encouraged to start their own radio station because of the wide reach of radio frequency, the ease of setting up a radio station, the less stress involved in running a radio station and of course the in – flow of commercial advertisement sponsorship.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
When you are making plans to open your radio station, it is important to consider the demographic composition you want to serve. It could be based on age group, ethnic groups or interest groups et al. These are some of the statistics that can guide you to choose the demography you want to design your radio programs for;
- More than 65 million Millennials use radio each week (52% male; 48% female). Average of 11.5 hours spent with radio each week
- More than 56 million Boomers listen to radio each week (53% male; 47% female)
- Boomers spend the most time with radio each week, with an average of 14.5 hours
- More than 94% of all Hispanics use radio each week (53% male; 47% female)
- More than 32 million Hispanics are reached each week with radio listen more each week than any other ethnic group, with an average of 12.5 hours
- African Americans (those 12 and older)Nearly 92% use radio each week (47% male; 53% female)
- Nearly 25 million African American listeners use radio each week
- Radio reaches 94% of Adults ages 18 and older each week with household incomes of $75,000 or more; they listen an average of two hours and 27 minutes per day
- Radio reaches 93% of college graduates ages 18 and older each week; they listen an average of two hours and 20 minutes per day
- Radio represents nearly one quarter of the time Americans (Adults ages 18 to 64) spend with media each day.
3. Decide Which Niche to Concentrate On
If you are looking towards starting your own radio station it is important to consider your area of strength before choosing a niche. Why is this important? Well, this is vital to consider, so that you can be known for one special thing. These are some of the niche you can choose from;
- Country Style Radio
- News and Talk Show
- Pop Contemporary Hit Radio
- Sports Radio
- Reggae Radio
- Religious Radio (Christian / Gospel Radio, Judaism Radio et al)
- Documentary Radio
- Science Fiction Radio
- Traffic and Metrological Radio
- Ladies Radio Channel
- Men’s Radio Channel
- Old School Radio Channel
The Level of Competition in the Industry
If you keen on starting your radio station, then you should be well prepared to compete with other radio stations. No doubt the competition level in the radio industry is high and for you to make headway in the industry, you should be able to come – up with programs that can get listeners glue to your radio station per time.
If you are into news, then you should serve fresh and latest news always. Naturally, people who listen to news usually tune to stations where they can get news as it breaks not stale news. As earlier stated, there are loads of people who are already in the trade and as such you have to bring something really unique to the table, since it is a survival of the fittest kind of business.
So, also if you into sports, then you should be up and doing in covering live sports events and also bringing the latest news in the world of sports.
4. Know Your Major Competitors in the Industry
All over the globe, there are loads of radio stations that have been in existence for decades. In the United States of America the case is the same. Hence, these are some of the top radio stations in the United States of America;
- WHTZ-FM – Z-100 – New York
- KIIS-FM – 102.7 KIIS-FM – Los Angeles
- KAMP-FM – AMP 97.1 – Los Angeles
- WXRK-FM – 92.3 NOW FM – New York
- WQHT-FM – Hot 97 – New York
- WKSC-FM – 103.5 KISS-FM – Chicago
- WBBM-FM – B96 FM – Chicago
- WXKS-FM – Kiss 108 – Boston
- KHKS-FM – 106.1 Kiss FM – Dallas-Fort Worth
- WIHT-FM – Hot 99.5 – Washington, D.C.
The income you can generate from your radio station is proportional to the finance that you pump into the radio station. It might be expensive to run a 24 hours 7 days a week radio station with some of the best on – air radio personality and quality programs, but that is part of what you require to attract listeners to you radio station.
If you have a robust listenership, you can easily attract corporate organizations and individual to place adverts on your radio station; that is perhaps one of the major means of generating income from a radio station.
5. Decide Whether to Buy a Franchise or Start from Scratch
The fact remains that all humans like to take an easy route in life. That is exactly why one may prefer to own a franchise radio station to starting a new one from the very bottom. The question therefore is; are there radio franchises available?
In the United States, if you want to start a radio station, you only have one option and the option is to start from the very scratch. The nature of the radio industry does not permit them to sell franchise on – like some other industry.
The industry is highly regulated and you would have to apply for fresh frequency if you want to set – up a new radio station in another location. You can choose to call the radio station same name, but it will not be on same frequency. For example of you are the owner of 92.7 City FM in Los Angeles, if you want to set – up another radio station in New Your City with same name, it might be 93.5 City FM.
6. Know the Possible Threats and Challenges You Will Face
The major challenge and threat that you are likely going to face when you start a radio station is the stiffer competition from your competitors. A radio station that operates within same location and with similar programs. The truth is that, organizations place adverts on radio stations that has massive listeners which is why you should always be on top of your game to keep people listening to your radio.
Other threat and challenge that you are likely going to face is unfavorable government policies; the government might come up with policies that will deprive you of airing your audiences’ favorite radio programs especially if it has to do with the security of the state et al.
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
The size of the radio station you intend starting should determine the legal entity that will be appropriate for you. Although when it comes to choosing a legal entity for a business such as starting a radio station, you have the option of choosing a general partnership, a limited partnership, an LLC, a “C” corporation, or an “S” corporation.
But on the average it will be better that you start a Limited Liability Company, an LLC for obvious reasons. Please note that these different forms of legal structure for business has its own advantages and disadvantages; which is why you must weigh your options properly before making your choice.
These are some of the factors you should consider before choosing a legal entity for your radio station; limitation of personal liability, ease of transferability, admission of new owners and investors’ expectation and of course taxes. If you take your time to critically study the various legal entities to use for your radio station, you will agree that limited liability company; an LLC is most suitable.
You can start your radio station as limited liability company (LLC) and in future convert it to a ‘C’ corporation or a ‘S’ corporations especially when you have the plans of going public (selling shares in the stock exchange).
Upgrading to a ‘C’ corporation or ‘S’ corporation will give you the opportunity to grow your radio station so as to compete with major players in the industry; you will be able to generate capital from venture capital firms, you will enjoy separate tax structure, and you can easily transfer ownership of the company; you will enjoy flexibility in ownership and in your management structures.
8. Discuss with an Agent to Know the Best Insurance Policies for You
In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance that is required by the industry you want to operate from. So, it is important to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best insurance policies for you’re a radio station.
Here are some of the basic insurance covers that you should consider purchasing if you want to start your own radio station in the United States of America;
- General insurance
- Health insurance
- Liability insurance
- Workers Compensation
- Overhead expense disability insurance
- Business owner’s policy group insurance
9. Protect your Intellectual Property With Trademark, Copyrights, Patents
Running a radio station will require that you produce your programs that are unique and exclusive to you. As a result, you will need intellectual property protection. If you do no secure your special programs or content, the possibility of other radio stations stealing your programs can’t be ruled out. It is also advised that this is done as soon as programs begin to air on the station.
If you have intellectual property protection for your special radio programs and contents it will make it easier to go to court and challenge anyone who decides to copy your content or program without seeking for permission from you. Besides, people will steer clear of your brain child once they know that it has intellectual property protection.
10. Get the Necessary Professional Certification
If you want to start a radio station in the United States of America, you will need a professional certification. One of the very reasons why being certified is advised by business experts, is so that you do not go into a business that you know nothing about.
Much more than being certified, it is very important that you carry out a thorough and exhaustive research that will help broaden your horizon. These are some of the professional certification that you can acquire before starting your radio station in the United States;
- Certified Radio Operator (CRO) you can obtain this certificate alongside Broadcast Station Construction Permit / License from the Federal Communication Commissions’ office.
- The Amateur Radio Operator Certificate and Technical Acceptance Certificate (TAC)
11. Get the Necessary Legal Documents You Need to Operate
No one can possibly go into the radio station business, without first having the appropriate legal documents. The radio industry is highly regulated in the United States and of course in most parts of the world. This is so because the security of a nation can be breached if an illegal radio station is allowed to operate within the airwaves of a country.
So, if you want to operate a radio station in the United States, it is advisable to consult the Federal Communication Commission to give you a list of all the legal documents that you would need to legally operate. These are some of the basic legal document that you are expected to have in place if you want to run your own radio station in the United States of America;
- Certificate of Incorporation
- Broadcast station construction permit / FCC License
- Business License
- Business Plan
- Non – disclosure Agreement
- Employment Agreement (offer letters)
- Operating Agreement for LLCs
- Insurance Policy
- Consulting contract documents
12. Write a Business Plan
Business plan is the reason why some successful businesses can look back and say that they followed particular and deliberate trends in building their businesses. The reason why people start commercial radio stations is to make money and making money involves attracting sponsorships and paid adverts from corporate organizations, government agencies, politicians, churches, activists and individual et al. hence the need of a comprehensive business plan.
Your Business plan is the blue print of your business; it is a business document that will help you to successfully set up a business and also administer / manage the business. It is not enough to just write a business plan for the sake of writing one, your business plan should be able to pass reality check; you must put relevant facts, figures and statistics into consideration when writing your business plan.
The truth is that, the main aim of writing a business plan is not just for the sake of having a business document in place; but to have a detail guide on how to effectively set – up, run and manage your business. Your business plan should outline and cover strategies on how you intend to operate your radio station and to attract listeners, adverts and sponsorship deals.
When writing your business plan, ensure that you are moderate when it comes to setting projections on income generation et al. These are some key factors that you should also consider when drafting a business plan for your radio station;
Executive summary and Company’s descriptions: you are expected to write about the concept behind setting up a radio station, descriptions of your company, your company’s vision statement, and mission statement, where your company will be located, the audience you want to reach out to and your management team.
Other key components that should not be missing in your radio station business plan are your service offering, SWOT analysis, marketing and sales analysis / strategies, adverts and sponsorship rates, costing and financial projection, management techniques, expansion strategies, publicity and advertising strategy, budget and start – up capital generation et al.
How Much Does It Cost to Start a Radio Station?
It is important to state that if you want to start a radio station, you should go for standard equipment and of course they can be expensive.
Your concern should not just be restricted to the amount needed to purchase standard equipment, but also the amount needed to pay employees and run the organization for at least 6 months, and the amount needed to secure a standard facility that meets your expectation and the amount needed to furniture and equip the office, the amount needed to pay bills, promote the business and obtain the appropriate business license and certifications.
When it comes to starting a medium scale radio station, the following expenditure should guide you;
- The Total Fee for incorporating the Business – $750.
- The budget for Liability insurance, permits and license – $ 3000
- The Amount needed to lease a suitable Office facility (Re – Construction of the facility inclusive) – $40,000.
- The cost of transmission and studio equipment ( installation inclusive) – $25,000
- The Cost for equipping the office (computers, printers, fax machines, furniture, telephones, filing cabins, safety gadgets and electronics et al) – $2,000
- The Cost of Launching your official Website – $600
- Budget for paying at least 10 employees for 3 months and utility bills – $ 60,000
- Additional Expenditure (Business cards, Signage, Adverts and Promotions et al) – $2,500
- Miscellaneous – $1,000
Going by the report from the research and feasibility studies, you will need about $150,000 to set up a medium scale radio station in the United States of America. You will need less than $20,000 to successfully set – up a small scale radio station in the United States.
If you are considering starting a large scale radio station that is far reaching with several employees under your pay roll, then you should budget nothing less than $500,000.
13. Raise the Needed Startup Capital
Establishing a standard radio station that will be on air 24 hours a day and 7 days a week requires solid capital base. As a matter of fact, you are not likely going to start attracting adverts and sponsorship deals within the first three months of operation which is why you must have enough money to cover the cost for at least 6 months.
No doubt when it comes to financing a business, one of the first thing and perhaps the major factors that you should consider is to write a good business plan. If you have a good and workable business plan in place, you may not have to go through stressful processes before convincing your bank, investors and your friends to invest in your business. Here are some of the options you can explore when sourcing for start – up capital for your radio station;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Sell shares to interested investors
- Applying for Loan from your Bank / banks
- Pitching your business idea and applying for business grants and seed funding from donor organizations and angel investors
- Source for soft loans from your family members and your friends.
14. Choose a Suitable Location for your Business
When it comes to sourcing for a location for your radio station, you can choose a location that fits into your budget. The location of your radio station does not need to be in a commercial hub; you can operate from the outskirt of town, as long as your signal can be received within the diameter you intend covering.
Besides with the aid of apps and the internet, you can locate your radio station in Hawaii, United States and someone in Lagos, Nigeria can listen to your radio station. Whichever locations you choose to set – up your radio station, ensure that it is safe and easier to locate.
This is important because your staff will work at odd hours and also for it to be easier for guest to visit your radio station when you want them live on air. The ideal facility for a radio station is of course a skyscraper if you can afford an office in such facility. If you radio station is situated in a high rising building, it is easier for you to transmit to a wider audience.
15. Hire Employees for your Technical and Manpower Needs
You would need a group of engineers to help you set – up the structure for your radio station. It is advisable that you acquire them as brand new because you can truly trust fairly used radio equipment, they may fail you when you least expect. Here is some of the equipment that you would need for to launch your radio station;
- FM Radio Transmitter, Antenna, Coaxial Cable, Power Supply, Audio Equipment and Accessories, Computers, Receiver, Transmission lines, Audio Processor, Connectors, Interface panel remote control, Cables, Equipment Rack, Power Protection equipment, UPS, Microphone, Silent Microphone boom arms, CD players, Mixer, Amplifiers, Monitor Speakers, Speaker Mounts, Computer automation software, Rack Mount, Power Protection Units
It is ideal to lease a facility or out rightly purchase one for your radio station as against renting on a short – term basis. When you lease a facility, it is easier for you to set up long term plans. When it comes to the number of employees to run a radio station, you are expected to use your discretion.
Although there are key roles that must be occupied, but that does not stop you from starting with a handful of employees and then grow the radio station as you begin to generate income from the station. On the average, you will need a minimum of 10 people to run a small radio station. This is inclusive of your anchor persons (one or two people can run each shift; morning, afternoon, evening and night shift).
16. Write a Marketing Plan Packed with ideas & Strategies
One thing about radio station is that it is easier to attract sponsorship and paid adverts when your radio station has a robust listenership. Before corporate organization sponsor or place advert on a radio station, the usually check the statistics.
That is why it is important to win the hearts of your target audience in your target location before intensifying efforts to get people to advertise or sponsor a program on your radio station. Here are some of the platforms you can utilize to market your consulting services;
- Introduce your radio station by sending introductory letters alongside your brochure to all the corporate organizations and businesses in the United States
- Advertise your radio station in relevant business magazines and news papers
- List your radio station on yellow pages
- Attend expos, seminars, and business fairs et al
- Create different packages for different category of clients who may want to sponsor a program on your radio station or place advert
- Leverage on the internet, social media and of course on your official website to promote your radio station
- Engage the services of marketing executives and business developers to carry out direct marketing
17. Develop Iron-clad Competitive Strategies to Help You Win
No doubt there are several radio stations scattered all over the United States who are working pretty hard to gain listeners because they need people to listen to their radio station if they want to continue to be in business. In order to survive the stiffer competition in the U.S. market, you would need to come up with unique business strategies.
Part of what you need to do to win your competitors in this industry is to give out freebies during radio shows, allow listeners to participate during live radio programs by calling into the radio station and also once in a while allow one or two of your ardent listeners to come on air live on your radio station.
18. Brainstorm Possible Ways to Retain Clients & Customers
One of the good things that can happen to any brand is having repeat customers at all times. The ability to have first time customers converted to repeat and ultimately loyal customers is the true reason why you are in business. Without being able to retain listeners, then things might nosedive badly.
Your customers in this regard are corporate organizations, government agencies, religious bodies, individual, and all those who sponsor or place adverts on your radio station and of course you listeners. So, if you are looking towards increasing customer retention for your radio station, then you should create different strategies for this group of people.
When it comes to retaining and increasing listeners all you need to do is to engage them when creating your radio programs, give out freebies during live radio programs and also give room for your listeners to participate during live radio programs by calling in and making use of social media platforms to contribute or share their thoughts.
19. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
Making your business known by all is one of the greatest tasks that you will need to carry out. This is because of the need to always make people tuned in on your station. However, there are times when doing this might prove a challenge. This is especially evident when you are not getting results when you carry out your marketing plans.
The nature of radio stations make it easier for them to make use of their platforms to create and boost their brand awareness and to create a corporate identity. Although, you can work with TV stations to promote your radio brand, but your best bet is to make use of your radio station.
You can also leverage on the print media and the internet to boost your brand awareness and create corporate identity. As a matter of fact, it is cost effective to use the internet and social media platforms to promote your brands, besides it is pretty much effective and wide reaching.
Lastly, you should create an app for your radio station that is compatible, IPhone Operating System (IOS), Android enabled device, and Windows Operating System et al. Apps makes it easier for people to connect to your radio station from their mobile devices without any stress.
20. Tips for Running Your Radio Station Successfully
Running a radio station is a lot of work. It is even more demanding when you run a 24 hours a day and 7 days a week radio station; you must do all it takes not to go off – air. No matter the kind of business you run, one of the key strategies to employ if you want to run the business successfully is to build a formidable team around your workforce.
When your employees work as a team, it is easier for you to achieve your business goals. Someone once define team as Together Everyone Achieves More. The truth is that there will be times when an employee will not be able to resume on – time and if you encourage teamwork amongst your employees, it will be easier for people to fill in for people when they are running late or absent from work.
Another thing that you need to do to run a radio station successfully, then you should work towards building a standard operating process. Organizations all over the world pay experts to help them build processes for their businesses. When you have a standard operating process in place for your radio station, you won’t have to be around all the time for things to work smoothly.
The essence of establishing standard operating process for your business is to make your business run on auto – pilot. Everybody on your team will be able to do what they ought to do without waiting for instruction from you or a superior officer et al.
Also, no matter how busy things might get for you because surely things will get busier; you need to create time to have regular meetings with your employees and your management team. Meeting with your team will give you the opportunity to re – strategize on how to move the business together, re – cast your vision, goals and motivate your team.
Starting a radio station may not come as easy as it seems. This is because of the huge amount of funds that will be needed to set-up and kick off the business. After that has been achieved, it can be then said that the business will be a money spinning one.
This is especially when you have the right sponsors on board. One other thing to take note of as you set up the radio station business is that you need the right people on your team that can help you drive the vision and mission to the maximum height.