Pricing. The topic that new photographers are always asking about and the topic that seems to be the hardest to find information on. In this article I am going to provide you with first step in pricing, determining your Cost of Doing Business or CODB. I will also provide you with links to other articles and tool for setting up your pricing. Before we get started to you need to accept three things:
There are no correct price you have to charge.
If you are meeting your financial goals with your business, then your pricing is correct for your business.
Your prices are not determined by what you would pay.
If you are able to something yourself, you usually are not willing to pay a lot for it. For example, I can work on cars, so I really do not want to pay a mechanic to work on my car.
Your prices are not determined on what other photographers charge.
After reading this article this will be clearer, but my experience has been that most photographers have no idea what they need to charge to be profitable.
Now that is out of the way, let talk about Cost of Doing Business.
Whether you have been in business for a while or are just starting out, determining your CODB is a critical step. To help you through this process I recommend that you download my COBD Calculator. The best way to define CODB are expenses that are inquired for running a business, regardless if you have a photo session. Some examples are website fees, rent, insurance, camera upkeep, etc. Remember that you need to pay yourself, so include a salary! Do not confuse CODB with expenses that are directly tied to a specific photo session. Some examples are printing, credit card fees, parking fees, etc. So the first step is to write down all the expenses you inquire annually or monthly. Be sure to write down every expense no matter how small. If you are just starting out and do not have past year expenses, estimate. The next step is to put all the expenses into the calculator. At the bottom of the calculator in yellow you will see the monthly and annual expenses. This is the minimum profit you need to make. The last line of the calculator is a handy tool, it show how much profit per client is needed every month. So enter the number of clients you hope to have per month. Remember the more clients you have per month will drop the profit needed, but at the same time will means you will work more hours.
Once you have determined your CODB, you now know what you need to make. This is the first step in determining pricing. Since pricing is a multi-step process, there is no way to cover all the steps in one article. If you are looking for information on this topic I recommend that you visit my site Addah’s Advice. There you will find articles and tools on a multitude of topics to include a 5 part series on pricing.
COBD Calculator Link: http://www.addahsadvice.com/?page_id=2601
Addah’s Advice: www.addahsadvice.com
Aaron Vance name is the owner of Addah’s Advice along as well as the business manager for his wife’s photography business, Donna Gail Photography. He is located in Waldorf, MD which is right outside of Washington DC. He started Addah’s Advice so he can share the knowledge I have gained running Donna Gail Photography. His goal is provide tools and knowledge to make business decisions, not a specific model that needs to be followed. Every business is as unique as the person running it. Be sure to check out his website and if you ever have specific questions feel free to contact me.
