Why do 85% of all new photographers go out of business within 5 years of starting their business? And then why do 50% of those remaining go out of business within the next 5 years? It is the same with most small startup businesses. They are usually undercapitalized, over-extended, untrained and 'following their dream' without a logical or realistic business plan. Too often their passion for photography doesn't come with any understanding of business or the self-discipline required to do all the non-photographic activities required for success. It is very challenging to survive as a small business, especially in changing times. Most small business owners work too much time in their business and not enough time on their business. A small business owner needs various skills in multiple areas: business management, bookeeping, planning, sales & marketing, computer systems and with photography also manufacturing and production. A great photographer also has to have the people skills along with the artistic eye and technical skills to produce great photographs!
There is a false assumption that digital photography is cheaper because you don't have to pay for film and developing when in truth professional digital photography is 25% more expensive than film because of the additional cost of the professional digital equipment along with the additional costs of the computer support equipment required and the additional costs involved in the digital developing. It amazes me the numbers of people who go into business without logically looking at the costs, expenses and potential income from the business.
Many aspiring photographers, with all the right intentions and little of the education, start a photography business and then have to close it and end up having to get a regular job so they can pay their bills. Some talented business owners discover that they can make more money in less time doing something other than photography. There are a lot of 'educators' in the field of photography who make their living by selling books, seminars, products, etc. these are the people who are training new photographers. The sad part is too many of them don't make their money in everyday photography but in selling seminars & DVD's.
The real problem is most aspiring photographers don't do their homework and don't look at the realities of the business costs and income potential. If you need to make say $30,000/yr. to support your family you would need to gross $150,000 per year (based on national averages) to be able to pay for all the expenses, equipment & supplies, taxes, insurance, overhead, etc. If you decided to do wedding photography and started at the low end of the market charging say $1,000 per wedding you would have to shoot 150 weddings over the next 52 weeks (nearly 3 per weekend)-- talk about burnout! You wouldn't have much time to spend on each of your clients or their images (or your family life). OK so instead you decide to shoot portraits so you charge $50 for the photo session and plan on selling an average of $250 worth of products to each client, you would only need 500 customers each year or 10 customers a week Then there are the 'digital' photographers who think shooting a session for $50 and giving the customer the CD is easier money. They would only need 3,000 customers each year or 60 clients a week. So if you spent 5-minutes preparing, 15-minutes photographing, 10-minutes burning the CD, 5-minutes collecting the money and 2.5 minutes on the phone and 2.5 minutes personal time per client you could work 9am-5pm daily to make ends meet but only assuming you had a steady flow of 12 customers a day. The average photographer works 60 hours a week and makes $24,000 a year (a little more than minimum wage). (see the government photography income figures here) The die-hard successful ones that survive for years have a strong passion for the business, charge more than most, have unique skills and are smart business people OR have a good retirement income and spouse that supports them!
New photographers usually start their own business for all the wrong reasons. Often they have a 'love of photography' or enjoy 'taking pictures' so they have a desire to become an independent business person/ photographer. Problem is 'picture taking' is only 20% of the job! Others think photography is an easy and inexpensive way to make extra money. Most really don't understand the true costs. To open a professional studio it initially takes $80,000-$100,000 before the first dollar is even earned. I've known husbands who encourage their wife's to 'follow their dream' and make some extra money by doing photography on the side. After a year or so of being 'real busy' they discover (usually at tax time) that the business that they thought was making money is actually costing them. Isn't it fun to work all year just to pay Uncle Sam? The wife then has to get a 'real job' for the next 3-years to pay off their photography business debt. Some just leave their problems behind by skipping town and disappearing.
Too often new photographers establish their prices by under-cutting their competitors. The problem with this type of pricing plan is it doesn't consider ones real costs. One photographer will have totally different expenses, costs and liabilities than another. (just like one photographers photographic abilities will be different than anothers) Many have the idea that they have to put in lots of time and effort for little or no profit to 'establish their name'. I predict they will be out of business before they are established! Too often the uneducated buyers swamp the cheap photographer and soon the quality of their service rapidly diminishes. Now the overbooked, underpaid photographer (without any extra working capital) needs to hire additional help if he/ she is to survive but can't afford additional help and has no time to improve their own education and skills to learn how to survive the mess they have created for themselves. It is then just a matter of time before someone (or everyone) gets burned.
Too often the new photographer, in their excitement to get new business, takes on projects they don't have the equipment or skills to complete, underbid jobs without a true understanding of what is really required or take on unprofitable jobs. All of these tactics ultimately result in burn-out or worse yet, bankruptcy!
In today's digital age there is a false belief that the cameras automatic program makes it easy for anyone to take great pictures! A digital photo only begins life in the camera, after countless hours of post-capture processing, tweaking and improving with the right software, tools and skill, a quality image properly captured can finally be develop into a truely 'professional image'.
Another false belief is that 'you can fix anything in photoshop'. (I don't know who this 'you' is but it's not me.) I'm sure given enough time, skill, experience and an unlimited budget that might be true. The problem is all digital editing software has its limitations and often the biggest limitation is the skill of the operator. There are many 'problems' that are much easier to fix and look better on the finished product if they are 'corrected' before pressing the shutter button than trying to fix them 'after the fact' in photoshop.
Today their are a lot of people without any training or experience with only a consumer-quality camera calling themselves 'professional' photographers and charging for their amateur services without being totally honest with their clients about their experience or capabilities. Although they may fool some people some of the time and may be able to perform in simple situations, the day will come when their lack of education, experience and understanding of their equipment and the photographic process will create a major problem for them and their unsuspecting client.
I am certain there are 'newbee' photographers reading this who are upset with me because I speak the truth and it's not what they want to hear, they have researched this far in the hopes of finding out what 'secret' will propel them into success, reality is there are no secrets! In the old days a photographer served as an apprentice for many years before being allowed to call themselves a photographer, today there is no such prerequisite. Buyer Beware! It is up to the educated consumer to determine if indeed the photographer can truly handle the work required.
Photography is expensive, when all is said and done a good photography studio owner takes home 20% of their gross sales in a well run studio (the top 5% as documented by a 2-year professional study of studios nationwide). If they did 50 weddings per year (which may cause burnout) at $2,000 each their paycheck would be $20,000 for the year or $8 per hour before taxes. How long can they remain in business at that price? They will either have to cheat their costs (some ways of doing this are by: avoiding paying taxes; not repairing or upgrading equipment; using cheaper inferior materials; taking advantage of contract loopholes; not delivering what was paid for; basic lying, cheating and stealing.) OR raise their prices OR get into another business. So in the end, the choices you have in the marketplace are either: 'new cheap photographers' who may not survive and the 'established experienced professionals' who charge a fair price based on their real costs and services. To the customer: It's your money, gamble if you wish.
To the new photographer: don't practise at the expense of an unsuspecting customer! Educate yourself and learn enough to know what you don't know and then serve your time (3-5 years) as an apprentice so you are well trained in the business before you take on major responsibilities otherwise you are only doing a dis-service to yourself, your customers and your future industry.
Not all RAW converters are the same, compare: (notice the strange color artifacts where the sunlight hits the carpet, you can tell which raw converter is the cheap one!)
