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Here's your latest guest column from none other than Bridget Jackson, resident guru for all things numbers and profitability. Bridget is the manager of PPA Business and also a CPA. She's helped hundreds of photography studios be more profitable and will address some common questions each month. Heed her advice folks--this lady knows her stuff!

frage.jpg7 Questions to Ask Before You Start a Business

Most people think that the barrier to entering the photography business is low. All you need is to buy a camera, create a Facebook page, and start taking pictures. But consider the odds: 25 percent of new business start-ups close in the first year, and another 25 percent fail in the next four years. How do you beat the odds? You have to set your business up to succeed by asking and answering the following critical questions:

1). What products and services will you provide?

Your business plan should clearly define what you are offering in terms of products and services and how that compares to competitors in your market. It is important for you to carve out a piece of the market to make a profitable and sustainable business.

2). Who is your target client and how will you reach them?

In other words, it's not only important to identify your target client, but you also need to reach them through different marketing mediums. Your integrated marketing strategy should include a blend of marketing mediums such as print, digital and interactive and social media. The results of these efforts should determine if you have an adequate population of potential customers to reach your sales goals.

3). How does your business stand out?

Your one unique selling proposition is YOU. It's who you are that makes all the difference. It's the reason that the one product or service you provide is different from and better than that of the competition. This is where you need to shine through your art, product offerings and customer service. You must be distinguishably different from your competition.

4). Where will business be conducted, and how many employees will you need to provide the level of customer service your ideal client will expect?

It's important for your physical presence, the way you present yourself, where you conduct business and how you conduct business to be an extension of your brand and should resonate with your ideal client. Initially, the number of employees you need to deliver the level of customer service you want to project might not be ideal, but don't compromise. Find ways to outsource workflow in seasonal times so customer service isn't neglected.

5). How much start-up money will it take to open the doors and keep them open until you turn a profit?

I mentioned the barrier to a photography business is relatively low; however, after answering the first four questions, I'm confident you have realized that the barrier is misleading. It requires an investment of money and time to set up a photography business to achieve profitability. Prepare a conservative five-year projection of income and expenses, and re-evaluate yearly to confirm you are on track as most businesses are to show a profit in the in the first year of business.

6). What will be the source of the funds needed for start-up and sustainability?

Consider how much you are willing to invest and potentially lose, how much is needed from outside sources and how much you can generate in profits to reinvest in the business. Clearly identify these sources and include in your five-year projection a plan to pay back yourself and anyone else.

7). What type of business structure will you choose?

What forms do you need to file, and which licenses do you need to obtain to assure compliance? The type of business structure you have will depend on two factors: liability and taxation. PPA recommends when you are just starting out and you have substantial personal assets to be a LLC.

Your business can also benefit from business advisors and mentors. You should develop relationships with a banker, an accountant and an attorney before you start. Additionally, as a PPA member, you can get malpractice insurance, up to $15,000 of free equipment insurance, free education, connections to industry mentors, certification and other vital resources to help you run a profitable business. The Benchmark Survey and its principles are also helpful when setting up prices and measuring your business' growth.

There are no assurances that a business will succeed, let alone be profitable, but setting yourself up for success through planning certainly can help.

It's a shameless plug, but after all, we're here to help: Join instructor Jen Basford, Cr.Photog., November 15-16 in Atlanta for PPA's Business Basics Workshop. You'll learn strong business principles that will help you create a solid foundation for your business. The class will give you the information and confidence you need as you plan for a profitable and sustainable business.

Say hello to your newest guest column! It comes to you from none other than Bridget Jackson, resident guru for all things numbers and profitability. Bridget is the manager of PPA Business and also a CPA. She's helped hundreds of photography studios be more profitable and will address some common questions each month. Heed her advice folks--this lady knows her stuff!

What do all entrepreneurs need to know?

By Bridget Jackson, CPA

This is a question I receive frequently, and see it all over the place on other sources of photography advice. Some of it is good, but some, well, you know...

I've read through multiple columns on what it takes to be an entrepreneur, and here I present you an abbreviated list of often-overlooked qualifications. It's not a be-all-end-all list by any means, but these are some takeaways that seem relative in light of the fact that I am a numbers person and a consumer.

1). If you don't know your numbers and how to read them, you've got one foot in the proverbial grave of a failed business.

That might seem harsh, but did you know that according to the Small Business Administration (SBA), only 2/3 of small businesses survive two years? The reason they flop is poor accounting.

Let me take that one step further and say that it's not enough to have your tax return prepared once a year. You have to understand what your numbers mean.

PPA is here to help you understand the principles of sound financial management, and it starts with managerial accounting. PPA provides resources to members to help you implement, understand and manage your business based on these principles. If you are not practicing, I encourage you to follow in the footsteps of what many successful studios have done before you and embrace managerial accounting today.

An added benefit of visiting the Benchmark Resources is participating in the current survey. Not only will you feel an overwhelming sense of community knowing that you contributed to the only industry-wide financial survey, but that you helped shape the results of the survey. PPA will release preliminary numbers at Imaging USA 2015.

2). Company culture drives a successful business

As the boss it is your job to define, provide the resources and participate in the implementation of your company's culture. Businesses that succeed in this area have an increase in overall employee satisfaction and retention.

For those of you who don't have employees; don't feel left out. I have one for you too!

2A). As the sole employee of your studio, you need to be prepared to "take out the trash."

That's right, although you won't have a boss to answer to, you will be left with the potentially unwanted tasks of answering the phones, cleaning, etc. So prepare yourself mentally for these roles. It's up to you to take care of the dirty work too!

3). Know your competition and treat them with respect.

Just because someone is a photographer doesn't mean they are your competition. Continue to evolve yourself as an artist by entering print competitions and by continuing to update your product offerings. Cultivate a professional relationship and level of respect among your peers. Their opinion of you and your business often outweighs others.  As a consumer, negative comments by one entrepreneur about another actually have detrimental effects on the business owner making the comments. One way to rise above is to become an industry expert in your market and lead by example.

Of course, it takes much more than this to create a successful business. But taking these small steps can make a huge difference along the way!

 

 

hillenga_jennifer_blog.jpgJen Hillenga, M. Photog. Cr., was kind enough to join us in the PPA Studio to film some upcoming PPAedu segments. While not wowing us with her endless creativity and knowledge, Jen took the time to answer your questions submitted to us @OurPPA (Twitter) or /OurPPA (Facebook). From practical advice on photography to the best sno-cones in the world, we learned all about the oh-so-creative Jen Hillenga.

Mary Lou Guinn asked: Studio management software - any recommendations?

Keep it simple. We use a combination of Quick Books and Google calendar. It has color coordination and a quick glance feature that makes our lives so much easier. It's also really great for marketing plans and counting out from deadlines. We haven't had a need for a big system, but use additional things like PhotoBiz to see who viewed images and incorporate that into the sales process. Pro Select is also great for sales. We're kind of old fashioned with client traveler, but it works for us. There's no "one stop shop" for what we do, so we put together our own system with a variety of software.

Denise Hasty asked: Having trouble with lighting, especially with darker subjects. What is the best setting for my camera when shooting in the studio and how do I avoid grainy and shadowy photos? / I have a Canon XSI450d

To create the best image, it usually works best to use a low ISO to minimize the grain and make sure you're using enough light. It helps to utilize the best equipment and tools to capture the best image. If you're in an indoor setting with limited light, investing in a camera that can go to a low ISO setting will greatly reduce the granularity in the image. In the outdoors with plenty of light, it's not as important, but you definitely need it in darker situations.

OurPPA asked: What are your thoughts on digital backgrounds?

I think there's a great place for digital backgrounds! I use them more for composite images. For example, we will photograph individuals on white, create the composition and drop in the digital background when working with a group setting. They can be nice with the right situation, but it's not a fix-all. It can be easy to get carried away and the digital can be overdone, not as natural.

OurPPA asked: Favorite color?

Black! It's the absence of color with light, and all of the colors with pigment.

OurPPA asked: Chocolate, vanilla or strawberry?

Mint chip.

OurPPA asked: Early bird or a night owl?

Night owl.

OurPPA asked: Favorite food:

Sushi!

OurPPA asked: Favorite (clean) word:

Clean? Oh man. Probably "Yes."

OurPPA asked: Where did you attend college? What did you major in?

I graduated from Dordt College in Sioux Center, Iowa. I double-majored in Fine Art and Graphic Design, with a double-minor in Art History and English.

OurPPA asked: What was the worst job you've ever had?


I worked concessions at a stock car track one summer. I did the sno-cones and nachos and it was a mess. It was the worst combination of salty and sweet--just the worst.

OurPPA asked: You love to travel - What's your favorite place to visit?

I spoke to the Photography Association in Denmark a few years ago, and that was wonderful. I also enjoy going to Hawaii--they have the best shaved ice! I also did the first trip down to Ecuador with Travis Gugelman and Lori Nordstrom with Dando Amor, photographing orphans.

Jen Hillenga, M. Photog. Cr. is the co-founder of Jen's Fabulous Stuff and a PPAedu contributor. You can find her educational videos, along with many industry greats on PPAedu. PPA members can easily access PPAedu by logging-in and watching the 150+ online videos. Not a PPA member? You can create your own personalized educational program by completing the Self-Assessment tool and subscribing to PPAedu!



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