Good morning everyone, happy Sunday…

So I was sitting with a creator last week who told me he wanted to make more money with his channel.

For context: a few Sundays ago, I talked about how the Creator Economy is projected to make $43.9 billion, but only 16% of creators surveyed make more than $50K a year.

Nearly half make under $10K. And just 5.7% make $100K.

But before we could talk about how much money he wants to make, I asked back:

“How much inventory do you have to sell?”

He didn’t have an answer. Which makes sense, about 7 years ago, I also didn’t have an answer. I had a lot of ideas and spent my time thinking about ideas, titles, thumbnails and subscribers.

But not inventory.

Yet inventory is the most basic concept in business.

And if your intention is to utilize your creative as a business, you have to think about inventory (not necessarily instead of, but in addition to your creative concepts). 

So here’s a quick run through of how I think about Inventory on YouTube for anyone who wants to make more money as a creator this year…

How To Calculate Your Creator Inventory

Let’s pretend you woke up this morning and decided you wanted to start a physical product company. 

The very first thing you would do to predict how much money the business could reasonably make is figure out supply and demand. Which really just boils down to:

How many units can we produce?

How many units can we sell?

Creators should be asking the same question.

And I don’t mean literally. You don’t need to start selling merch or come up with a snack line. I actually don’t think those are the best revenue streams for creators  anyways. 

Your “inventory” is your videos. So you need to be asking:

How many can you produce?

How many can you sell?

But a lot of creators don’t know how to answer those questions. So here’s how I would approach it if I were you:

Step 1: Figure out your inventory

The first thing we need to do is figure out inventory. So let’s take the next quarter as an example. Looking at April, May & June: How many videos can you reasonably produce?

Let’s say you can do 1, long-form video & 4, short-form videos per month…

That means your entire Q2 inventory is 3, long-form videos & 12, short-form videos. That is your available sponsorship inventory. 

Step 2: Set your revenue goal

Now, we’ve got to figure out your price per unit. But pricing is often the hardest part for creators.

If you were a production company, you’d calculate your cost of production and price from there. But for most creators, the biggest cost is just your time, so it’s not actually that clear. So instead, I want to show you how to work backwards from your revenue goal. 

So first write down what you want to make this year. Then divide that number in 4 so you know what you need to make each quarter. For example…

Let’s say the goal is $100,000 per year. Break that into quarters: $100,000 ÷ 4 = $25,000 per quarter. Now we have a target to work backwards from to figure out your price. 

Step 3: Assume a realistic fill rate

A “fill rate” is just how you predict how many of your available sponsorship spots are going to be filled.

The reality of sponsorship sales is you won’t sell every slot, just like hotels don’t fill every room and airlines don’t fill every seat. That’s okay. And it’s good for your audience to get a break once in a while, too.

A good assumption for many creators is a 50% fill rate. Meaning you pitch every video, but integrations land in about half of them. 

So even though in this hypothetical example, you have about 3, long-form videos & 12, short-form videos in available inventory this quarter (or 15 total opportunities)...you’ll likely only sell integrations in about 7–8 of them.

So if you want to generate $25,000 this quarter, and you expect to sell about 7 integrations, then each integration needs to average around $3,600.

One last thing on that note to think about is selling packages rather than individual videos. 

So a “Quarter Package” might be 2 long form videos and 4 short-form videos for a total of 6 videos distributed over 3 months. Which is really good for the brand because they’re getting way more face time with your audience and a broader portfolio of content on your channel, and it’s good for you because it helps you predict revenue.

This is how Colin & I started making good money from brand deals…way before we had a big audience. We knew who our audience was, how much inventory we had to sell, and how much it cost to work with us. So we could give brands something to react to rather than us being reactionary every time a brand approached us.

I know this is kind of hard to walk you through just writing it out, so I had my team pull a section out of our Brand Deal Blueprint course where I walk through this step-by-step. 

If you’d rather watch a video on this than read, then I’d encourage you to check it out…

Most creators operate like artists.They wait for brands to show up with an offer. But if you want to do your creative work as a business, you have to operate more like a media company.

Media companies manage inventory. They know exactly how many ad slots exist in every 60-minute block of programming. Creators should know exactly how many sponsorship slots exist in the next 90 days of content.

So know your inventory, set a goal, know your fill rate & work backwards to price yourself. 

You might be surprised how much clarity it creates. And if it’s your goal to make more from your creativity, my hope is that you adopt this process and it helps you. 

Until next Sunday,

- Samir