Merchandise is one of the highest-margin income streams an artist has, which is exactly why labels want a piece of it. In traditional deals, merch rights were separate. In 360 deals, the label takes a commission or even full control of your merch operation. Know which version you are signing before your t-shirts become someone else’s profit center.
The key questions are who controls design, manufacturing, and sales channels, and what the money split looks like. Some labels just take a passive commission of fifteen to twenty percent. Others want to run the whole operation through their merch division, which means you lose control of quality, pricing, and how your brand looks on a shirt.
Tour merch deserves special attention because that is where the real money moves. Venue cuts, printing costs, and inventory risk all eat into margins before anyone gets paid. If the label takes its commission off the gross before costs, you can tour for months and owe money on merch. Always negotiate merch splits on net, never on gross.
Protect what you built before the deal. Carve out existing merch lines and direct-to-fan stores you were already running. And keep approval rights over every design with your name on it. Your merch is your brand walking around on people’s bodies. Never hand that power to someone who sees it as just another line item.
Think of merch as a business you own that happens to be attached to your music career. The artists making real money treat it that way: tracking margins, testing designs, and building direct-to-fan channels the label cannot touch. Even inside a 360 deal, a well-run merch operation with clean accounting puts more money in your pocket.
About the Author – Ruben Burgos: Ruben Burgos brings over 25 years of music expertise and more than 15 years of model guidance to the table. He is the indie major pinnacle to retaining credits for musicians and helping them navigate this wicked industry without the fuckery.