Starting Your Photo Biz… Part 3: The Nitty-Gritty Business Details
Time once again for Photojojo’s School of Photographical Biznezz!
C’mon kids, let’s have some fun with tax forms, business plans and cash-flow management! Wheeee!
What’s the matter? You don’t look excited.
Come on, sure it’s business-y but it’s still photography. Your dream job, remember? Thing about dream jobs: they’re still jobs. So you have to do some jobby stuff.
But once you’ve got this down, you can get out and start living the dream!
Think of it like bungee jumping — there’s a lot of preparation and equipment testing ahead of time, but when you finally take the plunge it’s all worth it.
p.s. Don’t miss the first two in our photo biz series:
Starting Your Photo Biz… Part 1: You Sure ‘Bout That?
Starting Your Photo Biz… Part 2: What’s In a Name?
p.p.s. Hey Mom, we’re famous! Look, we were on TV!
Photo credit: Banalities
Lots of people have done this before and there are gazillions of resources to help you out.
If you get stuck or you’re not quite ready, remember there are free business classes.
You’ll be just fine.
*Hi non-US people! We still love you, but we had to make some of these tips specific to the United States. We put little asterisks after that stuff, but everything else is good international advice.
This is How it Goes
Everybody goes through the same basic steps when they start up a business.
Here’s the game plan:
- Write a business plan.
- Get enough money to get your business off the ground.
- Officially form a company and get a tax ID number.*
- Fill out a bunch of forms to make the business legit in your city/state/city-state/province/electrically-fenced enclosure.
- Get your gear together: cameras, computer, printer, paperclips, mechanical chicken separator…
- Go take pictures! And make people give you money for them!
Wow, that was the easiest tutorial we ever wrote. Awesome.
What’s that? You need more detail? Sigh. OK, keep reading then.
A Cunning Plan
Fine, that has nothing to do with photography, but great ventures start with great plans, and a business plan is indispensable.
Why? ‘Cause it focuses your thoughts, gives you a reality check on expenses and weak points, and looks good when you ask people for money.
What Goes Into a Business Plan
Here are some things to include in your plan:
- Vision/mission statement: What you plan to do and why.
- Business profile: How you plan to run things.
- Marketing: Who’s going to buy your photos and how you plan to find them.
- Competition: Who else is in your field and how you plan to stand out.
- Capital equipment: Stuff you need to operate your studio and how much it costs.
- Cash flow projection: How much you’ll have to earn and spend to make it through your first year.
- Exit strategy: How you can get out without losing your (or your investors’) money if it doesn’t work out.
Intimidated by the business plan? It’s OK. That’s why there are workshops to help you through it!
How to Get Enough Money
Most important: save your money and keep your day job until you have more than enough money to start your own studio. Leaping too soon is an all-too-common mistake.
Borrow from family or friends only if it’s a good business deal for everybody involved.
Pay your lender interest, make your payments on time, and make sure their money doesn’t get lost if the business goes down. Of course they love you, but things really do change when money’s involved.
Apply for a loan if you have good credit and a strong business plan. The SBA has some amazing loan programs* that can help you out.
Don’t bet the farm. Risking your house or your whole life savings isn’t a good idea- borrow as little as you can, and make sure you won’t get wiped out if the business fails.
Since it varies from state to state, your best bet is to get a startup package from your local SBA office.* It has forms, checklists and info on everything you need to get set up.
Here are the basic steps:
- Choose a business structure. You’ll probably have a sole proprietorship.*
- File a DBA (Doing Business As) form.* You need this if your studio name is anything other than your legal name.
- Get a tax ID number.* The IRS wants to know what you’re up to, you sly dog.
- Pay your taxes. The IRS* tells you what to do, but we recommend getting an accountant friend drunk and having them explain it to you instead. Way more fun.
How to Manage Your Money
It might sound nitpicky or boring, but if you do it right you can make enough money to hire an accountant. Don’t worry, you can do it!
What Gear Do You Actually Need?
While it’s tempting to buy a bunch of new gear and write it off, it’s better to save your money (at least for now).
Invest in good quality gear for the things you use every day, but don’t spend money on gadgets or seldom-used accessories.
Rent occasional necessities (like fisheye lenses or generators) on a job-by-job basis from places like Calumet or BorrowLenses. Then you can add the rental fees to your invoice and keep your overhead low.
If you went to photo school, keep in touch with your classmates — they’ll all be going through the same stuff.
Join a local photography group to find good tips and people to commiserate with.
And remember, when all else fails, somewhere there’s a briefcase made of bacon.
Don’t miss the first two in this series:
- Starting Your Photo Biz… Part 1: You Sure ‘Bout That?
- Starting Your Photo Biz… Part 2: What’s In a Name?
And stay tuned for our next installment: Marketing Your Photo Biz, featuring the incomparable Dane Sanders!
- Common business mistakes to avoid
- Dos and don’ts of starting a business
- SBA’s most frequently asked questions*
- The best things EP photographers have learned in business
- EP’s resources for photographers