Exercise 1

1.1

Rival Red Publishing (RRP) mission is to facilitate a platform for unknown artistry. Banding creative artists in the literary, music, and visual art fields. Operating in three segments: Rival Red Eyes (visual media), Rival Red Ink (print), and Rival Red Debut (music). Rival Red Ink publishes books for unknown authors, Rival Red Eyes facilitates the sale of artworks, and Rival Red Debut works to exploit musical works. Rival Red plans to receive a commission on all works sold.

Because there are three different divisions of Rival Red the typical sale will vary for each segment. RRI will generate an average of $8 per sale. RRE will generate an average of $50 per sale and RRD will earn an average of $100 per sale.

1.2

According to the Association of American Publishers the publishing industry is shrinking decreasing by 1.8% from 2008 to 2009. Over the next few years it’s estimated to decrease steadily.

The prices of RRP services to authors and musical artist are consistent with the industry standards ranging from 15%-50%. However, since there is no industry average or standard commission for artist/designers, Rival Red plans to offer a 60% commission.  Rival Red products will vary in price but are consistent with average prices in the publishing industry.

1.3

Authorhouse.com has 60/40 ratio of female to male visitors averaging 120K a year. Visitors’ ages range for 25-64 with 52% having received some college. 80% of visitor have an average household income 25K-99K.

Blurb.com has 420K unique visitors a year, 57% male, 43% female. Average ages of visitors are 25-44 that has an average household income of  $60K.

Lulu.com receives 900K unique visitors half being male and the other female. 47% of them have received some college. The majority of lulu.com visitors (76%) are between the ages of 25-54.

Rival Red provides both a product and a service to consumers. As a publisher we provide a service to authors, and visual and musical artist. We provide the artist work to the public to buy.