Questions to Ask Before Signing With a Record Label
These are the questions to ask before signing with a record label, for a musician or band holding an offer and for the manager or lawyer helping to answer it. They follow the order the decision tends to take: the headline terms of the offer, the people at the label, who owns the recordings and the other rights, how the money is counted, what the label commits to around a release, and how the options and the exit work. Most are for the label, and two are marked for your own lawyer and manager, because an answer given in a meeting only counts once someone on your side has found it in the contract.
The questions
Each question, and why to ask it
The offer
What type of deal are you offering: a traditional recording contract, a license, a distribution deal or a 360 deal?
Why ask it
The name of the deal sets almost everything after it: who owns the recordings, who pays to make them and how the money is divided. In broad terms a recording contract has the label fund and own the masters, a license lends them to the label for a set period, a distribution deal leaves you as the owner doing more of the work, and '360' means the label also shares in income beyond the recordings. Have the label say which this is in one sentence, then have your lawyer confirm the paper says the same.
Who will own the master recordings, and for how long?
Why ask it
Ownership of the masters decides who earns from the recordings, and who says yes to their use, long after the campaign is over. 'The label, forever' and 'you, with a license to us for some years' are very different offers at the same advance. If the answer is forever, ask what they would trade for a fixed term.
How long does the contract last, and how many albums does it commit us to?
Why ask it
Terms are often counted in albums or release cycles instead of years, so a 'one album' deal with several options can run far longer than it sounds. The figure to weigh is the worst case, in years: the longest the contract could run if the label took up every option.
How much is the advance, and what will be recouped from our royalties?
Why ask it
An advance is usually your own future royalties paid early, so what gets added to the balance matters as much as the size of the check. Get two things in writing: when the advance is paid, since it may arrive in stages tied to signing, delivery and release, and every cost the label can charge against your account. A smaller advance with few chargeable costs can leave you earning sooner than a large one with many.
What royalty rate would we earn, and what is it calculated on?
Why ask it
A percentage means little until you know what it is a percentage of: the label's receipts, a price after deductions, or profit after costs. Two offers with the same headline rate can pay very differently, so have the label work one example in round numbers, from the money it receives down to the line on your statement.
Can we take the contract away and have our own music lawyer read it before we sign?
Why ask it
The only good answer is yes, with time to do it properly. A label that wants a signature in the room, or offers its own lawyer to explain the terms to you, is showing how it handles a conflict of interest. Get the date the offer stays open until, so nobody can invent a deadline afterwards.
Is this the full contract or a deal memo, and which terms are still open to negotiation?
Why ask it
A deal memo sets out the headline points and leaves the detail for a long-form contract that arrives later, sometimes after the announcement photo. Find out which document binds you, and whether signing the short one commits you to accept the long one or stops you talking to other labels in the meantime. A first offer is often written with room in it, and it costs nothing to ask where.
Would you consider starting smaller, with a single or an EP, before a full album deal?
Why ask it
A short first deal lets each side see how the other works before anyone is tied in for years. If the reply is the long contract or nothing, the useful follow-up is what the label is afraid of losing.
For our own lawyer: which clauses here are normal for a deal this size, and which would you fight?
Why ask it
This one goes to the person you are paying, not to the label. A lawyer who works on recording contracts where the deal is made knows what labels of this size tend to concede, which saves you spending goodwill on points that never move. You will not win everything, so have the problems ranked.
For our manager: how are you paid on this deal, and do you have any other ties to the label?
Why ask it
Managers commonly take commission on the advance, so they can be paid on signing whether or not the deal turns out well. That is no reason to distrust yours, only a reason to hear them say what they would earn and whether they have other artists or business with this label. With no manager, put the first half of the question to your lawyer: flat fee, hourly, or a share of the deal.
The label
Why do you want to sign us, and what would you do in the first six months?
Why ask it
Listen for evidence that they know your music and your audience: a song they name, a show they came to, numbers they looked up. A six-month answer with actual steps in it suggests the signing has been discussed inside the building. Flattery with no plan often means the plan is meant to come after the signature.
Who at the label would work with us day to day, and what happens if that person leaves?
Why ask it
The person courting you is often not the person who answers your emails once the deal is done, so ask to meet the one who will. Some contracts name a key person and let the artist leave if that person does; your lawyer can say whether it is worth requesting here.
Which artists at our level have you signed in the last few years, and where are they now?
Why ask it
Their biggest act tells you little about how a new signing is treated. What became of the last three small ones tells you more: whether a second record came out, whether they are still on the roster, whether they left on speaking terms.
Could we talk to an artist on your roster, and to one who has left?
Why ask it
A label that is comfortable with how it treats people can usually hand over a name or two. The two things worth hearing from those artists are what was promised that did not happen, and whether statements and payments arrive on time. If nobody who left is offered, find one yourself, since plenty of musicians will answer a polite message from another band.
Who owns the label, and how is it funded?
Why ask it
An imprint of a larger company, a label living on its distributor's advances and one paid for out of the founder's pocket behave differently when money gets tight. With a small label it is fair to ask how the next two years of releases are paid for; with an imprint, how much say the parent company has over what comes out.
How many records do you release in a year, and where would ours sit among them?
Why ask it
A small team with a long release schedule cannot give every record a full campaign, so somebody is choosing. You want to know who chooses and what moves a record up the list. The answer gets concrete once they name the month yours would come out and what else is planned around it.
Who distributes your releases, and in which countries do you have people of your own?
Why ask it
Many labels reach shops and streaming services through a distributor or a bigger label, which takes a fee, and it matters whether that fee comes off before your royalty is worked out. Outside the home market, the honest answer is one of three: staff of their own, a partner label, or simply an upload.
Rights
Do the rights to our recordings ever come back to us, and what triggers that?
Why ask it
A reversion clause hands the masters back after a set number of years, or when a record falls out of release or the label stops trading. If there is none, ask for one tied to a date, because 'no longer available' is hard to show while a song sits on a streaming service. Your lawyer can also say whether the law where you live gives creators any right to reclaim work later.
Does the deal cover music we have already released, or only new recordings?
Why ask it
Labels sometimes ask for the back catalog as part of signing, and those are recordings you already paid for and built an audience on. If they want them, treat it as a separate deal with a separate price; a license for a few years may suit both sides better than a transfer. Check too that unreleased demos are not swept in by a broad definition of 'recordings'.
Is the deal for the whole world, or for particular territories?
Why ask it
Worldwide rights only help you where the label can actually release and promote a record. If its reach stops at one country or region, the request is to keep the rest, or to get a territory back when nothing has come out there within an agreed time.
Does the contract touch our songwriting and publishing, or only the recordings?
Why ask it
The recording and the song underneath it are separate rights that earn separately, and a record deal does not need both. If the label has a publishing arm folded into the offer, ask for it as its own agreement with its own advance and term, so you can say yes to one and no to the other. In some countries the contract can also lower the songwriting royalty the label pays on songs you wrote, often under the heading 'controlled compositions', so have your lawyer say whether that applies where you are.
Is there a re-recording restriction, and how long does it run after the deal ends?
Why ask it
This clause stops you making new versions of the same songs for a period after the contract is over, which matters if you ever want recordings you own outright. The number of years is only half of it: the clock may start at release or at the end of the term, and those can be far apart. Live albums and acoustic versions are worth raising by name.
How exclusive is the deal: can we guest on other records, keep side projects or release under another name?
Why ask it
Exclusivity usually attaches to each of you as a performer, not only to the band name, so it can reach a solo project or a feature on a friend's track. Bring a list of what every member already does outside the band and ask for those to be carved out in writing. Find out who approves a guest appearance and how quickly they answer.
What rights does the label take in our name, image, artwork, website and social accounts?
Why ask it
A label needs your name and photos to sell the record. It does not need to own the band's name, hold the logins or keep the mailing list after you leave, so settle which of those it wants and what comes back to you, passwords included, on the day the deal ends.
Who approves sync licenses for film, TV, ads and games, and how is that income split?
Why ask it
One placement can earn more than months of streams, and it also puts your song beside someone else's product or message. The points to settle are whether you can refuse certain uses, such as political campaigns, and whether silence from you counts as a yes. The split on this income is often set apart from the main royalty, so get the number.
Can the label license our recordings or voices for AI training or voice models, and do we get a say?
Why ask it
Contract language about 'all media now known or later devised' was written before this was a question, and labels read it in different ways. What you want is your consent required each time, written into the label's current draft and not left as a promise. The rules are moving quickly, so have your lawyer check the wording against the position where you live.
Money
Which costs are charged to our account besides the advance: recording, videos, promotion, tour support?
Why ask it
Every label draws this line in its own place, and some charge the whole of one cost and half of another. Go through the categories one at a time and write a percentage next to each. Since you are the one repaying it, spending above a set amount is something you can fairly want to approve.
Is the recording budget separate from the advance, and who controls how it is spent?
Why ask it
In an 'all-in' fund you make the record out of the advance and live on what is left, so an expensive studio comes straight out of your rent. With a separate budget, ask who books and pays, and what happens to money that goes unspent. Either way, find out who covers an overrun.
Does our royalty rate go up at certain sales levels, on later albums or once we have recouped?
Why ask it
These step-ups are usually called escalations. They cost the label nothing unless the record succeeds, which can make one easier to get than a higher starting rate, so if the draft has none, propose a rise at the point the label has earned back what it spent.
Are our accounts cross-collateralized between albums, or with any other income the label handles?
Why ask it
Cross-collateralization lets the label recover losses on one record from the earnings of another, so a second album that sells can be paying off the first before you see anything. It is common, and labels will sometimes limit it when asked. The minimum to hold out for is that publishing, touring and merchandise money sit outside it.
How are streaming royalties worked out, and what is deducted before our share?
Why ask it
Streaming is likely to be most of the income, which makes this the part of the contract to understand best. Some contracts still carry deductions from the days of physical sales, such as packaging charges, reserves held against returns or reduced rates abroad. Where one of those is applied to digital income, the label should be able to say what it pays for.
If the deal is a profit split, what counts as an expense before the split, and is there a cap?
Why ask it
Half of the profit can turn out to be half of very little once staff time, overheads, a distribution fee and outside promoters are taken off first. A sample statement from a real release, with the names removed, shows this better than the clause does. Skip the question if you have been offered a royalty rate and not a split.
Who pays the producer, the mixer and featured guests, and do their royalties come out of ours?
Why ask it
Producers often receive a share of record royalties on top of a fee, and in many contracts that share is carved from the artist's side, not the label's. Your headline rate then becomes a smaller real one, so the figure to compare between offers is your rate after a typical producer deal.
Does the label take a share of touring, merchandise, endorsements or anything else beyond recordings?
Why ask it
This is the 360 clause, and it can sit a long way into the contract under a heading like 'ancillary rights'. Have each income stream read out with its percentage. If you already earn from shows and merch you built without the label, say so, because that is your strongest argument for narrowing it.
If you share in our live or merch income, is it a share of gross or net, and what do you do to earn it?
Why ask it
A cut of gross is taken before your agent, crew, van and manager are paid, and on a small tour it can be the difference between profit and loss. Net is the version to hold out for, with the deductions defined. Whatever the label says it brings to those areas, a booking contact, a merch operation or tour money, should be in the contract next to the percentage.
How often do we get royalty statements, how are we paid, and can we see a sample?
Why ask it
Twice a year is a common schedule, and some labels have a portal that updates more often. Two details get missed: how long after a period closes the statement arrives, and whether small amounts are held back until they pass a threshold. A sample shows whether you could follow your own account without an accountant beside you.
Do we have the right to audit the label's books, and how far back can we look?
Why ask it
An audit clause lets an accountant you choose check that what you were paid matches what was earned. Look for how much notice is needed, how long each statement stays open to challenge, and who pays for the audit if it finds a shortfall. A short objection window can close a statement before you have any reason to doubt it.
If the deal ends while we are still unrecouped, do we owe the label anything?
Why ask it
The usual expectation is that an advance is recovered only from your royalties and never from your pocket, but the contract has to say so, and you can ask to be shown the sentence. The second half of the answer is whether the unrecouped balance stays against your old records indefinitely or is ever written off.
Release
Who has the final say on the songs, the producer, the track list and the artwork?
Why ask it
'Mutual approval' sounds fair until the two sides disagree, so ask who wins then. Go item by item, because a label may leave the artwork to you and keep the choice of single. If creative control is the reason you are talking to an independent label at all, weigh this answer above the advance.
Do you commit in writing to releasing the record by a date, and what happens if you do not?
Why ask it
Without a release commitment a label can accept an album and leave it on a shelf while you stay under contract. The protection is a deadline measured from delivery, with a remedy if it passes, such as the right to end the deal and take the recording elsewhere. What taking it would cost you, if anything, belongs in the same clause.
How much music do you expect from us, how quickly, and who decides whether an album is accepted?
Why ask it
The delivery schedule sets the pace of your next few years, so check it against how fast you really write. Then look at the acceptance test. A label that can turn down a record as not 'commercially satisfactory' can keep sending you back to the studio at recoupable expense, while a 'technically satisfactory' standard leaves the taste to you.
What is the marketing plan for our first release, and what spending is committed in the contract?
Why ask it
Enthusiasm in a meeting is not a budget. The version to ask for is on paper: the singles, the timeline, the people assigned and a minimum the label must spend. If they will not put a figure in the contract, what went into their last comparable release, and what it achieved, is the next best evidence.
Who handles press, radio, playlist pitching and social media, and are outside firms charged back to us?
Why ask it
Many labels hire independent publicists and pluggers campaign by campaign, which can be a good thing when the people suit your music. Find out who they would hire for you and why. Then check whether those fees are recoupable, because a campaign you never approved can add a great deal to your balance.
Will the record come out on vinyl or CD, and can we buy copies at cost to sell at shows?
Why ask it
For a band that tours, the merch table can be where most of the physical copies go, so the price you pay the label per copy matters more than it looks. Three things need settling: who pays for the pressing, whether that cost is recoupable, and whether copies you sell yourselves earn a royalty.
Will you put money into touring, and is tour support recoupable?
Why ask it
Tour support covers the gap when early tours cost more than they bring in. It is usually recoupable, which makes it your own royalties arriving early and not a gift. Ask who sets the amount for each tour and whether the label expects a share of the ticket income in return.
What would you expect from us beyond making the record?
Why ask it
Some labels want constant posting, long tours and a yes to every promo request, and it is better to hear that now than in a tense phone call next year. Numbers help: weeks on the road, posts a week, days of press. If band members have jobs or children, this is where that gets said out loud.
What would you count as a good result for our first release, and what happens if it falls short?
Why ask it
Their answer is the yardstick you will be measured by, whether that is streams, ticket sales, press or simply a record they are proud of. A target far above your current numbers is a sign that disappointment is already scheduled. The telling follow-up is what they did the last time a release missed.
Options and exit
How do the options work: who decides whether there is a next album, when, and on what terms?
Why ask it
An option is usually the label's choice and not yours: if the record does well they keep you at terms agreed today, and if it does not they let you go. Two details decide how much that hurts: how long after a release they have to make up their mind, and whether the advance and royalty rise with each option. Fewer options is one of the more valuable things a new artist can ask for.
Under what conditions can you drop us, and what happens to our unreleased music if you do?
Why ask it
Being dropped happens to a lot of artists and is survivable, provided you leave with something. The something is usually the finished recordings the label never released, so find out whether you can take or buy them back, and at what price. Check too that being dropped ends your obligations completely, including any share of touring or merch income.
Is there any way for us to end the deal if you stop releasing, promoting or paying?
Why ask it
Plenty of contracts give the label several exits and the artist none. A usable exit says what counts as a breach on their side, how you give notice and how long they get to put it right. Which of those remedies would hold up in practice is a question for your lawyer, since it depends on the law the contract sits under.
What happens to the contract if a member leaves or the band breaks up?
Why ask it
A leaving-member clause can let the label keep the departing person on the same terms as a solo artist and decide whether to carry on with whoever remains. Each of you should understand it before signing, because it binds you individually. It is also a good moment to write down, between yourselves, who owns the name and how income is shared.
What happens to our contract and our recordings if the label is sold or closes down?
Why ask it
Catalogs are bought and sold, and a buyer may have no relationship with you at all. The clause to look for says whether the contract can be assigned without your consent, and whether you would get a first chance to buy your masters. With a very small label, ask what becomes of the recordings and any unpaid royalties if it simply stops trading.
Which country's or state's law governs the contract, and how would a dispute be settled?
Why ask it
The governing law decides which rules on contract length, royalties and reclaiming rights apply to you, and those differ from place to place. A clause that sends every dispute to arbitration, or to a court far from home, can make a complaint too expensive to pursue. Hand this one straight to your lawyer.
How to work through a record deal offer
Practical guidance for the conversation itself
Before you talk terms
Get the offer on paper
A phone call saying the label wants to sign you is not an offer. Ask for the deal memo or the draft contract before the next meeting, and read it with these questions beside you. Plenty of them will be answered on the page, which leaves the meeting for the ones that need a person: the plan, the people, and which terms can move.
Find a lawyer who does recording contracts
A general lawyer can read a contract. One who negotiates record deals where yours would be signed knows what a label of this size usually gives way on and what the law there adds or forbids. Ask how they charge before they start, whether by the hour, a fixed fee or a percentage of the deal, and make sure they act for you alone. A musicians' union or songwriters' organization in your country may keep a list, and some offer a contract reading service to members.
Write down what you already have
Before the meeting, put your own numbers on one page: monthly listeners, tickets sold at your last few headline shows, merch income, mailing list size, anything you own outright such as an earlier EP. This is your leverage, and it is also the comparison. Whatever the label offers has to beat what you could do by releasing through a distributor and keeping your masters.
Agree among yourselves first
A band that argues in front of the label hands it the easier negotiation. Sit down without the manager and rank what matters: owning the recordings, money up front, creative control, a short commitment. Decide who speaks for the band and which two or three points you would walk away over. If you have no written agreement between members about the name and the income split, make one now, since the contract will assume somebody knows.
Who to ask what
Ask the label about the plan and the people
The groups tagged The label and Release are for a conversation, ideally with both the person who wants to sign you and the person who would run your campaign. You are listening for detail: names, months, amounts, the last time they did it for someone else. Ask the same question to two people at the label on different days and compare.
Ask the contract about rights and money
For Rights, Money and Options and exit, what anyone says in a meeting is only a guide to what they intend. The answer that counts is the clause. When the label answers one of these, ask which section of the draft says so, and note the section number. Where the draft says something else or nothing, that is the list your lawyer takes back to them.
Ask your own side separately
Two questions under The offer are marked for your lawyer and your manager, and most of the others are worth repeating to them afterwards: 'the label told us this, is that what the paper says?' Keep those conversations away from the label. If the manager introduced the deal, the lawyer should still be one the band chose and pays.
Ask for a worked example
Royalty language is hard to picture. Ask the label to run a simple case through the contract: a round amount of streaming income, the deductions, your rate, the recoupable balance, and what would reach you. Then ask your lawyer to do the same sum from the draft. If the two results differ, you have found the clause to talk about.
Weighing what you hear
Put the worst case on one page
Write out what the contract allows if everything goes the label's way: the longest it can run, what you own at the end, what is charged to your account, which other income it shares in, and what the label is actually obliged to do. Then write the same for the case where the record does nothing and you are dropped. A deal you can live with in both cases is a deal you can sign calmly.
Trade instead of refusing
Negotiation goes better as an exchange. A label may accept a license for a fixed term if the advance is lower, drop the share of touring if it keeps an extra option, or raise the royalty once costs are recouped. Decide beforehand what you would give up to get your first priority, and let your lawyer make the offer.
Count only what is written
A marketing budget described over dinner, a release date mentioned on a call and a promise that 'we never enforce that clause' all have the same value once the person who said them changes jobs. If a promise matters to you, ask for it to go into the contract or a signed side letter. A label that means it will usually agree.
Let more than one offer exist
Check first that nothing you have signed, a deal memo included, stops you talking to anyone else. Then, if another label, a distributor or a publisher has shown interest, tell them you have an offer and ask whether they want to make one. You are not being disloyal. A second set of terms shows you which parts of the first are normal and which are not, and you can still sign with the label you liked best.
Where artists get caught
Signing for the advance
The advance is the most visible number and often the least important. It tends to be spent long before the contract ends, and it comes back out of your royalties, while ownership, term and options go on. Read the offer as if the advance were zero and see whether you would still want it.
Using the label's lawyer
However friendly the relationship, the label's lawyer is paid to protect the label. The same goes for a lawyer the label recommends and offers to pay for. Some labels will add a sum to the advance toward your own legal fees, which is worth asking about, as long as you choose the lawyer.
Accepting an invented deadline
'We need this back by Friday' is sometimes true and often a way to stop you reading. Ask what happens on Friday. A label that has spent months watching you is unlikely to disappear because your lawyer needs two more weeks, and one that would is telling you how the next few years would feel.
Leaving the exit for later
Nobody likes to discuss the ending while everyone is excited, which is why the exit terms tend to get the least attention in a first draft. Ask the Options and exit questions while the label still wants something from you. After you sign, the only route to better terms is the label's goodwill.