I have been getting so many emails lately asking how I do things that I thought I would start a business series to help answer these questions. I consider myself just a newbie only being in business for 4 years but have worked my bum off over the last 2 years since going to August exposure for the first time.
If I can help one person make it than I have done my job…my motto is too pay it forward, there have been many people who have helped me along the way and this is my way of giving back to our photography community.
It’s a really scary thought when the statistics say that for evey small business that starts today 80% won’t be here within 5 years. We are in the industry of selling relationships and we are letting ouselves and our customers down by not doing things correctly so we can be there for them through their future and make a living for our family. Why do you run your business if it’s not to earn a wage/ make a profit?
This is one of the scariest things for people starting out, they throw a price on their packages and think ok that sounds resonable, after 2 years the price is the same and at tax time your accountant says…you’ve made a loss of $20,000.
This is what happened to me. I could either go on and become one of those statistics or change the way I do things, so I have a business that is run properly and that actually makes a profit.
I enlisted the help of a business coach, it was confronting to say the least. I worked out that I was lucky to have been chargeing myself out at $5 an hour. It worked out better for me to go and get a job at a supermarket than run my own business. I see so many making this same mistake, and the many workshops I have done they talk about it. But how do we change it ?
- So how do we work out of prices, well its so easy but takes a few hours out of your schedule.
- First of all, write down the steps of exactly what happens from the moment a customer emails you to the time that they pick up there products at the end.
- Don’t cut corners here the more detail the better.. every appoinment, email, telephone call, editing time, blog posting, album deisgn, resizing images, sendng images off too the printer everything!
-Write it as steps.
-Now put a time next to it. eg; it takes me 1 hour for our initial appointment, 5 minutes to send them an email confirming there booking, 15 minutes to put together their welcome package, postage etc.
- Keep going till you have every step down with an exact time next to it, even if you have to put a timer next to you when you do things. Sounds crazy but time is money and in every other industry they value their time and put a price on it. Look at lawyers for instance!
Ok are you done? surprised? I know I was surprised, holy hell I said to my coach no wonder I never have time to do anything lol!
How much are your products or cost of goods?
Every piece of paper sent, packaging, ribbon, proof albums, telephone calls, disk’s and disk covers, album costs, price-list sent, how much did they cost you to print and design and page costs don’t forget frieght on your suppliers sendng you stuff.
Now how much are you worth an hour? honestly? times that by the time you spend with your cusomters and than add up you cost of goods and put them all together?
For instance $50 an hour which a very resonable/ low price for a pro x by 35 hours = $1750 + cost of goods $850 (just an example) $2600. This should be your base price and what you have to work on. This dosen’t include the general workings of your business like insurance, internet, commercial space, albums , staff etc… are you freaking out now? how much do you charge now as a base?
I have had so many people say to me that i should drop my price when I move the the SC as it is a different market. If I drop my prices I will be working at a loss and I want to be running my business still in 10 years time and constantly growing. Some people put this pressure on others because they don’t value there time and work, blunt but so true!
Canberra has so many wonderful photographers who are running amazing businesses, remember if you are at the top and not increasing your prices there is nowhere for the people just starting out to go. We have to stop thinking of ourselves as a unit but as a community. Next series we will work out our break even amount, this is how much we have to make a month to break even.
Are you to scared of putting value on yourself and your work?
Remember our customers value us when we value ourselves!! Don’t be a statistic!!
And a photo to remind me why I run my business…. Family!
Photo by Jinky Art who runs an amazing business and who we value because she puts value on her work!