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From Marathon Press
Given the unprecedented number of photographers entering the portrait/wedding industry each year, the increased level of competition makes it even more important for both new and experienced photographers to master the fundamentals of business management if they expect to achieve financial success. These key success strategies are outlined in the industry's first Financial Benchmark Survey published by Professional Photographers of America in 2006. Here are some important highlights:
Gain experience before you quit your day job.
Learn about the business of photography by operating a part-time business while still drawing a salary from stable employment. Don't go out on your own until you can:
- Develop a following among your target market, so that you can gain client referrals.
- Develop consistent cash flow from your part-time business. Most experts agree that a photographer should be grossing between $50,000 and $100,000 annually before it is wise to consider a full-time business in a home studio and at least $150,000 before considering a move to a retail location.
- Create an efficient workflow that will allow you to deliver orders on time.
- Bank enough cash to live on until your business becomes profitable. This can take from two to five years.
Control your start-up overhead.
Starting a home-based business will help you to control operating costs and provide the additional benefit of writing off some home expenses as legitimate business deductions. Not every home lends itself to business operations because of zoning and/or image considerations. So if you must start a business outside the home, search for a low-rent location such as a community-based business incubator until your business can afford costlier facilities.
Understand financial and operational requirements.
Don't go into business until you understand the financial requirements of doing business. Vital areas of concern are:
- Being fully aware of all business costs, from investment capital to monthly expenses and product production costs.
- Knowing how many sessions or events you must photograph to cover these costs and earn a profit.
- Learning how to price your photography according to industry standards that assure profitability.
PPA's Studio Management Services covers these issues at their Business Basics Workshops PPA Headquarters in Atlanta. The next Portrait-Wedding Basics workshop is scheduled for July 19-20. A Business Basics Workshop for Wedding Photography is scheduled for August 10-11. You can learn more about these workshops by clicking here. Budget your capital investments very carefully.
Too much debt will doom a business from the start. Remember: Your business must be able to generate enough revenue to pay you (or the bank) back for the capital investments you make. Even if you have the cash to invest in capital items and don't have to go into debt, that cash might be needed to help you survive the early business years when most studios do not generate enough revenue for the owner to draw a salary. Once you have the business start-up essentials, a good rule of thumb is to purchase only those extras that you can pay for within 12 months.
Once you do take the plunge into a fulltime business, build business volume as fast as you can, doing whatever it takes to get clients in the door.
PPA's Benchmark Survey confirms what business authorities know: The difference between financial success and failure often turns on the ability of a new business to build sales volume quickly. That's why many recommend not starting a full-time business until you already have a loyal following from running a part-time business. Even so, a full-time business will require additional strategies for building sales. Get the word out any way you can: through networking with other businesses; hosting a series of open house events for different community segments; get involved with charitable organizations by donating photography to their fund-raisers; look for "marketing partners" to help spread the word; get displays of your work on the walls of retail businesses and/or professional offices; and even offer "invitational sessions" for the purpose of "expanding your advertising portfolio" or making samples. Building your business base early will establish sales levels high enough to sustain your business over the long term.
Develop a clear business focus that consumers can easily understand. Don't expect prospects to be attracted to your business if you fail to create a business concept that is easily understood by consumers or one that lacks compelling products to excite their fancy. Sometimes it pays to direct your new business to only one or two niches, such as family and children's portraiture or wedding photography. Limiting your business in this way will help you to develop a strong focus that consumers can readily understand, and it will greatly simplify your marketing efforts.
Study effective marketing methods. Learn how to create year-round marketing strategies designed to:
- Attract new clients.
- Market back to existing clients, finding ways to reward them for their loyalty.
An excellent resource for learning about marketing methods as well as helping you to create a marketing plan is the Marketing Resource & Activity Planner for the Professional Photographer, available from Marathon Press at MarathonPress.com or call 800/228.0629.
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