Legality on selling mixtapes?

Alright, coming out with my first mixtape soon and I have spent a lot of money on the studio equipment. I want to make some profit considering I am good at what I do. Say I have permission to use the beats from producers. I have their direct permission to use the beats on my mixtape. Now, I record my lyrics onto these beats and throw together a mixtape. I burn the mixtape on to CD's and sell them locally only to friends and family. Would this be illegal? If so, define how illegal it is.