The Cost of Starting and Being in Business - Photography part 6
(This is a reprint of a series of notes I wrote on Facebook in 2009)
In our last episode we discovered our Start up costs for a homebased photography business would be about $3370 with an additional $3081 annual reoccurring costs.
I thought I would touch on pricing a little. I'm not going to say what you should charge, or exactly how you should come to a pricing point. I am going to discuss cost factors in pricing.
In our last episode we discussed an estimated number of shoots; working out to 20 weddings and 100 portrait sessions for the year. we also talked about the hard cost of copyright registration at $35 per collection. Are business starting cost plus annual reoccurring cost averages over the 120 shoots to about $54. That brings our hard costs per shoot to $89. But wait there is more. We haven't talked about equipment.
Depending on who you talk to your equipment costs for shooting digital will vary based on the type of system you have for your DSLR or your computer.
For this exercise we'll talk about a Canon DSLR system and a PC computer.
We'll assume our subject has a commercial license of Photoshop CS3 and Lightroom 2.5 and a DSLR with a few lenses. They will be upgrading software and although they have an older pc they need a new computer to handle the new 30MB DSLR image files.
For a basic PC computer they have decided on a i7 HP elite system with 9GB of ram for $1200 and expect to replace this system in 18-24 months.
The upgrades in software for photoshop and lightroom (CS5 and LR3 are coming) amount to $200 for photoshop (alone) and $100 for Lightroom. total $300 without any plugin software
For the DSLR They will be upgrading in about 12 months with a estimated price of $3000 staying with Full-Frame cameras. We'll assume that they will buy one lens at about $1500 in that year time as part of a long term investment. we'll also buy two flashes at $500 each (we'll talk in a future episode more about equipment and basic system guidelines)
So over the next year $1200 computer + $300 software + $5500 cameras and equipment totaling $7000. Since this will have about an 18-24 month life we'll take have for this year $3500
So over our 120 shoots that's and additional $30 of costs; totaling about $120 per shoot in just costs.
Since rarely do clients only want a cd of the images for weddings and portraiture, prints need to be added to this. Print costs very by Lab, so do your own research about your lab and costs.
We'll base our cost off a basic package as we are focusing of basic costs. Most basic packages have a time limit from 1-2 hours at one location and include basic retouching and a few prints or a print credit. we'll assume less then 5-8x10 prints divided in to print options. we'll estimate the cost at $30-50 (note this depends on many factors and is not indicative of any real pricing but is an exercise in understanding costs. Real world costs will be higher or lower depending on LABs and photographer prices for prints include the photographers time and talent in editing the prints and this price should not be considered in the value a photographer brings to a shoot)
Going with the lower end we have a cost of $150 per shoot. (this can be higher or lower for every photographer and will vary based on the number of total shoots in a year)
Next we should factor in a little profit of $30,000 take home pay. plus 15.9% self-employment tax $4770 adds $290 to the minimum costs. Adding that to only the portraits would be too much so more of that amount is dished to the wedding shoots. at about a goal of $1000 per wedding and $148 per portrait shoot
So at a minimum you will have a starting pricing point of ~$140 per portrait shoot, and $1400 per wedding don't forget to collect your local and state sales tax. For our subject that is 6.85% or ~$10 per portrait shoot and ~$96 per wedding bringing the pricing out the door to ~$150 per portrait shoot and ~$1500 per wedding with that number being higher or lower based on individual business requirements. (this is not indicative of any real world pricing, but an exercise in basic cost factoring in any shoot and consideration should be reviewed for specific individual businesses.)
That brings our Start up costs for a homebased photography business to about $6870 with an additional $6581 annual reoccurring costs.
If your a photography business owner feel free to share your experience in costs you deal with that effect your pricing.
In our last episode we discovered our Start up costs for a homebased photography business would be about $3370 with an additional $3081 annual reoccurring costs.
I thought I would touch on pricing a little. I'm not going to say what you should charge, or exactly how you should come to a pricing point. I am going to discuss cost factors in pricing.
In our last episode we discussed an estimated number of shoots; working out to 20 weddings and 100 portrait sessions for the year. we also talked about the hard cost of copyright registration at $35 per collection. Are business starting cost plus annual reoccurring cost averages over the 120 shoots to about $54. That brings our hard costs per shoot to $89. But wait there is more. We haven't talked about equipment.
Depending on who you talk to your equipment costs for shooting digital will vary based on the type of system you have for your DSLR or your computer.
For this exercise we'll talk about a Canon DSLR system and a PC computer.
We'll assume our subject has a commercial license of Photoshop CS3 and Lightroom 2.5 and a DSLR with a few lenses. They will be upgrading software and although they have an older pc they need a new computer to handle the new 30MB DSLR image files.
For a basic PC computer they have decided on a i7 HP elite system with 9GB of ram for $1200 and expect to replace this system in 18-24 months.
The upgrades in software for photoshop and lightroom (CS5 and LR3 are coming) amount to $200 for photoshop (alone) and $100 for Lightroom. total $300 without any plugin software
For the DSLR They will be upgrading in about 12 months with a estimated price of $3000 staying with Full-Frame cameras. We'll assume that they will buy one lens at about $1500 in that year time as part of a long term investment. we'll also buy two flashes at $500 each (we'll talk in a future episode more about equipment and basic system guidelines)
So over the next year $1200 computer + $300 software + $5500 cameras and equipment totaling $7000. Since this will have about an 18-24 month life we'll take have for this year $3500
So over our 120 shoots that's and additional $30 of costs; totaling about $120 per shoot in just costs.
Since rarely do clients only want a cd of the images for weddings and portraiture, prints need to be added to this. Print costs very by Lab, so do your own research about your lab and costs.
We'll base our cost off a basic package as we are focusing of basic costs. Most basic packages have a time limit from 1-2 hours at one location and include basic retouching and a few prints or a print credit. we'll assume less then 5-8x10 prints divided in to print options. we'll estimate the cost at $30-50 (note this depends on many factors and is not indicative of any real pricing but is an exercise in understanding costs. Real world costs will be higher or lower depending on LABs and photographer prices for prints include the photographers time and talent in editing the prints and this price should not be considered in the value a photographer brings to a shoot)
Going with the lower end we have a cost of $150 per shoot. (this can be higher or lower for every photographer and will vary based on the number of total shoots in a year)
Next we should factor in a little profit of $30,000 take home pay. plus 15.9% self-employment tax $4770 adds $290 to the minimum costs. Adding that to only the portraits would be too much so more of that amount is dished to the wedding shoots. at about a goal of $1000 per wedding and $148 per portrait shoot
So at a minimum you will have a starting pricing point of ~$140 per portrait shoot, and $1400 per wedding don't forget to collect your local and state sales tax. For our subject that is 6.85% or ~$10 per portrait shoot and ~$96 per wedding bringing the pricing out the door to ~$150 per portrait shoot and ~$1500 per wedding with that number being higher or lower based on individual business requirements. (this is not indicative of any real world pricing, but an exercise in basic cost factoring in any shoot and consideration should be reviewed for specific individual businesses.)
That brings our Start up costs for a homebased photography business to about $6870 with an additional $6581 annual reoccurring costs.
If your a photography business owner feel free to share your experience in costs you deal with that effect your pricing.
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