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By: Lauren Walters
If you're looking to make a bigger profit, PPA's Benchmark Resources are here to help revise your budget. A small change can make a huge difference in your business. In fact, a 1% decrease in your cost of sales and overhead expenses can save you as much as $50,000 by the end of the year.
For a retail studio, overhead expenses should estimate to about 40% and cost of sales at about 25%. Keep in mind that your profit depends upon the amount of sales for that fiscal year. For example, you need about $143,000 in sales to earn a $50,000 profit. Make sure to use PPA's Square One tool to see the change 1% makes to your bottom line.
The video below stresses the importance of creating a strategic budget and sticking to it! Watch and learn more about how to keep your sales and expenses in line with your new 1% budget.
For more information, visit PPA.com/Benchmark. Be More Profitable.
In the previous post 2 Studios Are Getting a Full Business Makeover This Year! you met PPA Studio Makeover recipients, Wes Roberts and Krista Newbill and read the overview of the makeover process.
Now that the makeovers are underway, you can follow along with their progress! First up is Wes as he and the PPA mentor team dove into the financials of his business.
Wes was super excited to get started. He's been working with PPA's Business Consultant and CPA, Bridget Jackson, to get a handle on where he is currently and the best way to move forward.
First, we always did a complete financial analysis of the studio. It's important to know what's working and what's not. We did this by comparing Wes' studio's numbers to PPA's Benchmark Survey. By comparing his cost of sales, overhead and net profit we started to get a good picture of the pitfalls that are causing monetary loss. We also uncovered potential opportunities for savings.
Wes' numbers looked better than the average benchmark studios in 2013 and 2014. However, his 20% cost of sales percentage doubled between 2013 and 2014. While, in general, 20% is a great number to achieve (below the recommended 25%), we had to figure out what has changed to cause such a drastic uptick and put everything in place to ensure that trend would not continue in 2015.
Second, PPA mentors helped Wes develop a photography business plan for 2015 that included three goals:
I pulled into the parking lot of the restaurant, our carpool rendezvous point, to collect Trish for
our third wedding of the weekend. Twelve hours earlier I had dropped her off to retrieve her car, twelve hours before that, the same. The days, the weddings, the people blended into one never-ending wedding reception with the despicable Old Time Rock n Roll looping horribly in my addled mind.
"I look like crap, I have huge dark circles under my eyes," complained Trish, slumping back into the seat.
"Aww, I bet it's not that bad," I said, lifting my sunglasses to get a good look at her.
We gasped in unison at the sight of each other's faces.
"You've got them too!" she cried.
"We look like a couple of zombie photographers." I said, defeated.
It's that time of year, October, and we feel like zombies too. Big, dumb, lumbering, drooling, driven to put one step in front of the other without thought or reason zombies. We are zombies hell bent on our one desire: to finish the weddings!
It didn't take a neurotoxin, virus, brain parasite, or tainted meat to turn two relatively attractive photographers into zombies. No, all it took was some overly ambitious booking, leading to forty three weddings to execute. My bad. But hey, what's done is done, right?
So we'll go ahead and slather a little more makeup on our faces to cover the dark circles and hope we can blend in with the rest of society; much like Bill Murray in my favorite zombie movie of all time, Zombieland. (Spoiler Alert) Bill has an excellent cameo role where he makes himself up to look like a zombie in order to blend in with the zombies and survive the zombie infested world. Okay, well that's actually the opposite of what we are doing but you get the idea.
Since it's almost Halloween and we are already on the topic of that great piece of Hollywood cinema, Zombieland, I have adapted some of the rules for surviving in Zombieland as they apply to wedding photographers surviving the end of wedding season. The hero of the movie, Columbus, has 32 rules for surviving Zombieland. Before meeting his friend Tallahassee who has also survived the infestation, these rules kept Columbus alive and well. Therefore, they must be true and henceforth I shall share nine of them (and two of my own) with you to help you survive the apocalypse that is "The End of the World Wedding Season."
By Mariah Ashley
When my daughter was two and having a bad day because she was asked to eat her
vegetables, told it was time to go to bed or scolded for coloring on the kitchen wall, she didn't get sad and cry. Instead she got mad. She'd clench her fists and grit her little Chiclet teeth. Looking up at from me from behind her bowl cut she'd snarl, "You're the one what did it! You're the one what made me sad!" It was hilarious and disturbing all at the same time. She's twelve now. We're still working on it. But that's another story.
The story I want to tell today is a cautionary tale of how NOT to be The One What Did It, The One What Made Your Clients Sad, because it's always a good day when you aren't ruining your clients wedding. I've had cause to ponder this question lately as I've helplessly watched a few fellow wedding vendors wreaking havoc on my clients.
Take the case of the overly dramatic/distracted justice of the peace. I've been working with Fred the JP for years and without fail, I hear him before I see him. Fred shouts my name when he sees me regardless of the distance between us, the setting we are in, or the inappropriateness of shouting at a wedding. Fred also stands right behind me and breathes what's left of his lunch at the back of my neck. He likes to make small talk during the ceremony processional, which is of course a causal moment where we both have free time and no job to do. I awkwardly bob my head to avoid being rude to Fred while trying to nail my shot of the bride and her father coming down the aisle toward their bobble-headed photographer.
A few weeks ago I worked with Fred again. It was status quo; shouting across the lawn, small talk and bobble-heading. But wait, this day had a twist! Moments before the ceremony, Fred beckoned me to photograph the signing of the marriage license. The mother of the groom was about to sign as the first witness. Fred as chatty as ever, hurriedly explained to her to "sign here" and "print here" and then waived his finger over the area for her signature. He turned to me and continued his blah-blah-ing, leaving her to her own devices. You can see where this is going. Yes, she signed in the wrong spot.
"Oh no! Oh my! I've signed in the wrong spot!" she gasped, squinting at the document.
"What?!" he shouted, jerking his attention from me back to her.
"What do we do now?" she asked.
"Nothing, now! It's not like I have another copy!"
That's when the groom walked over.
"What's wrong?" he asked.
"Well your mother has just ruined this legal document by signing on the wrong line. It's invalid and you can't be legally married without it."
The groom's face drained of all color. The groom's mother started ringing her hands and apologizing.
"I love you mom but I can't look at you or talk to you right now." said the dismayed groom.
The wedding planner was the next on the scene of the disaster.
"What's going on?" she asked. "I heard raised voices."
"I'll tell you what's going on, this is all garbage," announced Fred brandishing the ruined document and waiving his hand over the lawn indicating that the $100K wedding was now trash.
"Don't say that!" said the horrified wedding planner coming to the defense of the stricken groom. "You cannot tell my clients that their beautiful wedding is garbage!"
"Can you believe these people Mariah?!" asked Fred a few moments later behind the backs of the wedding planner and the nauseous groom. I just bobbled my head and walked away but what I wanted to do was clench my fists and grit my Chiclets and snarl. "Fred! You're the one what did it! You're the one what made them sad!"
By Mariah AshleyEverything was going wrong. The groom was throwing up and the bride was taking it very personally. "He's going to go through with it isn't he?" she nervously asked the wedding planner.
By Mariah Ashley
"If only you could pick your family as easily as you pick your nose. You could fix every issue with a flick of your tissue." - Mariah Ashley
Nancy came in to give us all the details of her wedding a few months before the event. Generally brides are pretty pumped at these meetings and tell us to-the-minute details down to the music the jazz trio is playing for the processional. Irrelevant yes, but we smile and "Oooh " and "Aaah" as any good wedding vendors should.
Not Nancy. Nancy had nothing exciting to report. No extraneous details to share. Nancy was strangely quiet, even hostile. Nancy was negative. "I'm just not your typical bride. I'm not excited about all this wedding stuff. I'm pretty sure the wedding is going to be kind of a mess. I'll just be glad when this is all over!" blurted Nancy.
O...K...? Awkward! We sat there a little stunned and wondered, why on earth would you go through the trouble of planning and paying for a wedding when you have an attitude like that?
Spoiler Alert! Nancy ends up as one of our top three clients of the year. The reluctant bride with a
small budget wedding spends $11K and counting on her wedding photographs. Seriously, we need to add some more products because we have run out of things for her to buy.
So what happened between Nancy hating on her own wedding and spending gobs of money on photographs after?
Have you seen the movie Little Miss Sunshine? There's a great scene where Dwayne (the teenage son) gets some upsetting news while on a family road trip. He totally loses it in the back of a VW bus and his step dad has to pull over to the side of the road so Dwayne can have a nutty. Dwayne's mom says, "For better or for worse, we're your family." Too which Dwayne eloquently relies, "No you're not my family okay? I don't want to be your family. I hate you f*#%ing people. I hate you! Divorce? Bankrupt? Suicide? You're f*#%ing losers! You are losers!
The bad news Dwayne receives is his tipping point. He just can't take another second of his family's dysfunctional BS. Nancy and Dwayne are one in the same.
After Nancy's nutty she opened up a little about her own family situation. Divorce, remarriage, tense relationships, absentee parent, etc. Poor kid, no wonder. Her negativity was her defense mechanism. Nancy was setting her expectations REALLY low so as not to be disappointed by her family... again.
Like Nancy, most of our clients think they are the only ones with a crazy family, but the reality is dysfunctional is the new normal. Are you with me? Trust me, I know a thing or two about this. I am completely reduced to my teenage self whenever I am around my family for too long.
Here's a secret about me that only Trish and my husband (and now you) know... my fifteen-year-old self ran away from home three times. The third time was the charm though; I got to spend the night in jail. I had a metal bunk and a non-private privvy. The temperature in the slammer was about 50 degrees and my jailers had confiscated my shoes. I lay there shivering and learning my lesson which was the intention of the coppers after all. I didn't run away again because I realized for better or for worse my family was my family and I really do prefer my bathroom to have walls. But back to Nancy...
I'm happy to report that on the wedding day everyone was on their best behavior. Yes, tension and resentment crashed the party but so did regret and tenderness and we chose to focus on the latter. We got a beautiful photograph of Nancy's mom tenderly helping her get ready, fastening family pearls around her neck. We also got a beautiful shot of Nancy and her father dancing, tears of regret streaming down his cheeks.
I heard an interview on the radio that got me thinking about how Nancy had gone from reluctant bride to becoming one of our top clients. Elizabeth Dunn and Michael Norton authors of Happy Money explained that people are happy to spend their money and happy even long after the purchase when their money is spent on an experience such as a vacation. The part that I found interesting was that photographs play a huge part in enhancing the remembered experience of the vacation and reinforcing the positive feelings about the decision to spend the money. Because you can re-live your memories over and over again through your vacation photos, the memories of the trip often become even sweeter than the actual moments that were experienced. The camera only focuses on the smiles and sunsets and not the hassles and petty squabbles that go along with any trip, so that is what is remembered.
At the end of Little Miss Sunshine, perhaps the most dysfunctional family road trip of all time, the characters end up dancing together in a scene that will make you so uncomfortable you squirm, and laughing so hard you'll cry. That's pretty much what happened at the end of Nancy's wedding too. Everyone was on the dance floor in one big, crazy-flawed, fun-loving family pile dancing their butts off.
A Roman philosopher said of nostalgia, "Things that were hard to bear are sweet to remember." Because we hyper-focused on finding the tender and loving moments behind the bitterness at Nancy's wedding we were able to exceed her expectations and show her something that she may not have been able to see herself but probably felt that day. Although her family is dysfunctional for better or worse they are hers and they undoubtedly love her. What Nancy needed was a vehicle for her nostalgia. She needed a way to look back on the day that had caused her so much grief to plan with fondness and no regret for the money they had spent. Because the photographs reflect a beautiful bride, a couple in love, and a supportive family (with stellar dance moves) Nancy upgraded her album, bought three parent albums and framing for walls.
We've all had wedding clients with family tensions so thick that we want to run and hide. It's easy and natural to want to throw your hands in the air and say, "There's nothing to be done for these people their f*#%ing losers!" Before you do that though, remember that you might just be throwing your future best client out the window. Dig a little deeper, remember your own whacked out family, and see if there isn't a little crack of tenderness to expose in the wall of dysfunction.
By Mariah Ashley
Author's Note: Required Reading! The Go-Giver, by Bob Burg and John David Mann. A little story about a powerful business idea.
I was alone in the upstairs bedroom. Amanda (the bride) was late getting back from the salon so I spent my time photographing her dress and invitation. Her mother kept popping in with other things she thought I might find interesting, among them a pair of fabulous Louboutin sequined heels.
"Oh, fancy! Shoes are like porn for women," I joked cradling the shoe near my face.
"So true," said Amanda's mom, with a chuckle. "Everything about this wedding is a little over the top. (nods toward shoes).
"But Amanda is such a good girl, so smart and hardworking. She's such a humble and sweet girl. I just want this to be an amazing day for her."
Amanda's mom left me alone with the shoes and my thoughts. A few days earlier I listened to a podcast by former Imaging USA speaker Jeffery Shaw. He interviewed author Bob Burg on his national best-seller, The Go-Giver, which describes "giving as the most fulfilling and effective path to success."
Burg and co-author John David Mann map out the Five Laws of Stratospheric Success all focused on giving instead of getting. Intriguing! Trish ordered me the book and I devoured the parable in one sitting, highlighting passages like a mad woman. Since then I haven't been able to think about much else besides adding value to my clients lives, with the exception of thinking about how much I was dreading photographing Amanda's wedding.
When Amanda first contacted me, she had just experienced what she described as a "bad engagement session experience" with another photographer she had originally booked to photograph her wedding. She wanted to talk to me about that experience, get my opinion on whether or not her expectations had been unrealistic, and discuss the possibility of having us photograph her wedding instead.
by Mariah Ashley
My son Jacques is not a joiner, not a jock and let's just say not terribly motivated.
Upon my insistence, he has committed himself to participating in a high school sport. Since he abhors football, is bored to death by baseball and can't dribble to save his life, he is running on the cross country team.
The "unofficial" team training started in July under the very loose control of three senior brothers, triplet captains whose parents were Olympic runners. The coach has devised a running program that divides the team into three categories: those who will go on to be Olympians like their forefathers, those with gazelle blood in their veins and my snoozy soon to be sophomore son. After the team warms up together Jacques is left plodding along alone in his size fourteen sneakers while the other boys with normal sized feet rocket past him.
Each morning at 7 a.m. we have same routine.
"Jacques get up it's time for running."
"I don't want to go today," he pleads from under a mountain of blankets. "Can't I just run on my own?"
"No!" I insist, shaking the lump of blankets that contains my son. "You are part of a team; that means you run with the team. You joined this team, so you need to BE MORE dedicated!"
"But I don't run with the team. I run on my own. How about I run with you? Mother-son time?"
"Nice try. The captains need to see that you are showing up. It's about being together as a team. You need to BE MORE social."
"I don't care about that." He groans, rolling over and scooting like a 6' 1" caterpillar toward the far end of his bed.
"JUST GET UP! YOU ARE GOING!" I shout, slapping the lump. "Really, you need to BE MORE motivated."
The teenage lump finally rises and I drive it to the high school and park inconspicuously so as not to embarrass it. I notice a few cross country kids sitting on picnic tables at the far end of the parking lot. The lump doesn't move from his seat.
"Jacques, aren't you going to get out?"
"I'll wait a few more minutes till the rest of team shows up," he says reclining his seat all the way back, making himself invisible.
"Why? What's wrong with those kids? Why don't you go sit with them?"
"I don't like them," he mumbles. "They're seniors. They're jerks."
"It's weird to want to sit in the car with your mom. You should BE MORE friendly. Go ahead, get out of the car and go sit with your team," I insist pushing him out the door.
He makes his way reluctantly over to the older kids and sits down awkwardly at the far end of the table. Without a word directed in any direction he stuffs his headphones in his ears and stares at his phone. The rest of the team chats casually. This is painful to watch. The other boys are older, fitter, confident. Shirts are stripped off, flirtations exchanged with the girls running team and then they are off like a pack in one direction with Jacques running off alone in the other. My heart breaks a little for him and I fret about him for the next hour while I wait to pick him up.
7 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.
Think about it: how useful has filling out a survey ever been to you? Well, for Heather Sams, CPP, from Fountain, CO, not only has it helped her business be more profitable, but she also won an iPad mini. How?
PPA's Benchmark Survey, of course. The industry's only complete financial snapshot, it's been helping businesses get a better idea of where they stand and how they can improve their bottom line. Survey participants get a free side-by-side comparison of the results to their financial data. With that kind of valuable info, the monthly giveaways for survey participants only seem like an added bonus!
Sams has been in the photography industry for over a decade, and previously used the Benchmark to put together a business plan when starting her portrait studio seven years ago. "What's great about Benchmark is that it puts all the industry information in one location that businesses can easily use," she said.
Since building up her business, Sams knew the importance of the survey to her success. "I was excited just to have been able to participate in the Benchmark Survey this year! It's such an extensive tool that the industry has access to that it just made sense for me to take the time to do it."
She never considered the fact that she could win the monthly giveaway. "When I found out that I won, I thought it was the coolest thing ever. It was super easy to participate, but winning an iPad really takes the cake. I was on cloud nine!"
And as a true dedicated professional, Sams already has plans to incorporate the iPad mini into her business. "I photograph executives, and they like seeing portraits and galleries immediately. Having a device that can make this happen will be great for my business," she said. "I'm grateful that I had the chance to participate in the survey."
Want to get in on all the Benchmark awesomeness? Check out PPA.com/benchmark and enter for your chance to win this month's prize. And don't fret! There will be more through the end of the year!