Sunday, February 24, 2008

Last Chance for Giveaway Gala!!

With our Giveaway Gala only weeks away, everything has kicked into high gear and we're almost sold out!!! I get so excited just looking at the guest list and the awesome sponsors who are giving away really valuable products and services! This party is going to be AMAZING!!! If you're going to be at WPPI on Monday 3/17, you do NOT want to miss this event!! Location information is only being provided to registered guests, so make sure you're on the list!! I can't wait to see you there!! (That reminds me, I still have to find something swanky to wear!)

*Special thanks to Lindsay over at the Pay It Forward blog for helping host this awesome party!

Thursday, February 14, 2008

One-on-One Mentoring for Thirst Relief

**UPDATE** Auctions are currently STILL OPEN, but will come to their final end Thursday evening!

At this very moment, celebrity photographers are being auctioned off for charity! Get in on the action and you could spend at least 90 minutes one-on-one with your favorite photographer! If you'd like to have your mentoring session in person, you can bid to spend time with them at WPPI where they will answer every question you can squeeze into your time together. However, I also think that you could bid just to have a long phone conversation with them in the event that you can't make it to WPPI! All of the proceeds go to Thirst Relief International, which provides water filtration systems around the world to help eliminate water borne illnesses that cause over 5,000 deaths every day. Not only will you be getting great advice from an awesome photographer, but you'll be saving lives as well, and I don't think it gets any better than that. ;-)

Check out some of the star-studded names that you could bid on!!
Kevin Kubota • Bebb Studios • Gary Fong • LaCour • Bambi Cantrell • Yervant • Jose Villa • Mike Colon • Jesh De Rox • Jessica Claire • [b]ecker • Joe Buissink • David Beckstead • John Michael Cooper • Dane Sanders • Denis Reggie • Davina • Vicki Tauffer • Brianna Graham • Laura Novak • Jasmine Star • Fred Egan • Anne Ruthmann (how did that get in there?!) • and many more!!!!

The best part of this auction is that there are some amazing photographers who you might not have heard of before, but would be awesome to win! So, if you can only budget a certain amount of money toward a charitable donation for a mentor, see if you can get someone who's a total bargain! There are 5 pages of photographers to bid on! I guarantee you'll still get some great one-on-one advice and maybe even learn a new way to do things in your business! You have ONE DAY LEFT TO BID!!! Are you thirsty yet?!


*note: if an auction is very active at closing time, the auction will remain open until the highest bidder is no longer contested*

Saturday, February 9, 2008

Formulas for Pricing Products & Services

Pricing isn't a mystery. It's simple math that can be done on your cell phone calculator. Once you've taken the time to think about the WHY questions behind your pricing you're ready to move on and do the REAL numbers. Or, if you need to see the real numbers before thinking about the bigger questions, here's a bunch of nitty gritty formulas to help you make sense of everything involved in pricing.


For most freelance artists and independent contractors who need to find a value for their time, I suggest starting with your desired annual salary (before tax and benefits) and then dividing that by the job, or by the hours you'd like to work during the year in order to determine your hourly or project rate of pay. Keep in mind that a self-employed person needs to make substantially more than someone who has health insurance and retirement benefits already provided by an employer. Typically 25-30% of your income will go straight to taxes. You may need to do a little research on health and disability insurance to figure out how much of your income you'll need to set aside for those, but I'd say it's not uncommon for another 20% to go toward health insurance, and 5-10% toward retirement investments. When you add all of that up, you can see quite easily how 50% of your earnings may actually never make it to your bank account. There are some tax advantages to working for yourself, but there are also a lot of costs involved in running a business.

Example 1: Target Net Income Per Job

Example 2: Target Hourly Income

The examples above help you determine if a job is worth your time, and if there are parts of your job that would be become more profitable if someone else were to do them. For example, let's say it takes you 5 hours to color-correct a wedding. If your time is worth $33/hr, than your production cost for color-correction is $165. However, if you hired someone else to do the color-correction and let's say they're a little slow because they're still learning, so it takes them 8 hours at a rate of $10/hr, than you just reduced your costs to color-correct by half! This means that you now have more time to work on higher priority projects while someone else can work on lower priority projects at a production cost savings to you.

Example 3: Production Costs


There are several reasons why businesses sell products:

  • Products may be the only source of income to pay employees and cover overhead costs
  • Products can help define the business brand or image
  • Products as a means of extending convenience and service to clients

Whatever reason you have for selling or not selling products, make sure you're pricing them properly by taking everything that goes into providing them into consideration.

Product Based Business

If you're running a product based business, than all of the income your business earns comes entirely from the sales of your products, and you need to include the following figures into your pricing:
- Salaries for all employees (aka production costs)
- Overhead
- Cost of products (production + materials)

Service Based Business
A service based business may sell products, but the bulk of the income comes from providing a service and the products are typically add-ons or part of serving the clients needs. This business model can separate the cost of providing the service from the cost of the products so that it can sell or not sell products. In this case, the product prices are more based on:
- Materials Cost
- Production Cost

The quick & dirty (aka lazy) method of pricing is to take your production and materials costs and multiply it by four in hopes that it will also help cover your overhead costs, salaries, and taxes. If this were the formula that Starbucks, Nike, Cable companies, and even your favorite restaurant down the street used, everything would be a whole lot cheaper! Obviously the "simple" solution is not one that can support a growing business. So, here are the numbers you need in order to determine the actual costs of offering a product:

The cost of materials should be the easiest to figure out, since you have to pay for them directly. If it's an album, it's the cost of the prints and binding. If it's a DVD, it's the cost of the DVD itself and maybe special packaging.


These costs are generally time-based costs. The time it takes to create something either by you or by someone you hire needs to be factored into the price of the product. If you are currently doing the production on everything and consider this to be a "free" cost- (insert record scratch noise)- think again. If something were ever to happen to you and all of the production you're doing would need to be outsourced to someone else, this would have a VERY real cost and you would be out a LOT of money if something were to happen to you and cause a situation where you still needed to rely on that product income, but could not produce the product yourself. Do NOT take this cost for granted, it WILL bite you in the end.


This can encompass a lot of things- hence it's ambiguous name. Basically, these are the costs associated with just staying on top of business in general, and things which a lot of freelancers who are new may fail to consider in their initial pricing structures. Here are some things that are typically included in overhead costs:

  • Rent
  • Utilities
  • Maintenance
  • Professional Memberships
  • Rental Insurance
  • Replacement Insurance
  • Liability Insurance
  • Accountant
  • Bookkeeper
  • Lawyer
  • Advertising/Marketing
  • Sample/Test Products
  • Equipment Upgrades/Depreciation
  • Software Upgrades/Depreciation
  • Education/Tradeshows

By looking at the overhead costs on an annual level and dividing that by the number of jobs you intend to work, or the number of products you intend to sell, you can determine exactly how much of your overhead needs to be accounted for in the price of each job or product you offer. Yes, the math is tedious, but do it now and you'll save yourself from many future headaches of wondering where all of your money went and why you don't have any income to get that new camera or computer you need, or take that vacation you cleared your schedule for. The beauty of overhead costs is that because most of them are expenses for your business, many of them are also tax deductible. I've included a sample of what overhead costs may be for a service based business that relies on 30 jobs per year, has a very reasonably priced office space or studio (maybe even in their home), has a few websites and likes to order sample products as well as special gifts for marketing, and values education and staying current in their field:

Example #4: Overhead Per Job (click to enlarge)


The price for most service based projects or jobs involve:
- Overhead
- Production
- Product (optional)

This is where most, if not all of the profit ends up going after production and products have been paid for. You really NEED to have a grasp on these numbers before you determine your pricing. In order for long-term success to happen, you need to have a budget for upgrades, experimentation, samples, marketing, office space, utilities, insurance, accounting, legal, and more. Maybe you're mooching health insurance off of your spouse- what if they were to suddenly lose their job and neither of you had health insurance? What if you had children? Maybe you work from home- but you still claim a room or square footage of your house as office space and you still need to furnish it to make it most productive for you. If you have kids, you still need to hire daycare or a nanny to take care of the kids so that you aren't distracted while you're in your home office. Maybe with both parents working full time, you need to hire someone to clean the house so that you can spend more quality time with your kids, or with each other, when you aren't working. Maybe you're on the road traveling and shooting so much that you would really benefit from having someone in your office answering phones, filing paperwork, setting up appointments and dealing with vendors. I could go on and on.. but these are the things you REALLY need to think about and budget for in advance in your business. I didn't even talk about an "oh shit" fund, but that should be included as well- especially in the event of a major natural disaster. No one needs to rehash how long it took insurance agencies or the government to step in and provide aid to people suffering from hurricane Katrina. Maybe it's not a huge natural disaster, maybe your camera just completely craps out on you or a $1500 lens accidentally hits the floor and becomes unusable. Is your insurance deductible low enough for you to comfortably replace it? Would you need to pay for another one immediately? Being a professional means being prepared for anything- are your finances prepared for anything?


These are the people costs in your business... or the time costs to complete the project. Whether it's paying yourself for your time, or paying someone else to help you produce a product or a project, know exactly how much time (and money needed for that time) goes into producing each product or job you take on. You already know the benefits of hiring someone at a lesser rate based on Example #3: Production Costs. You already know how much you need to make from each job in order to be self-employed based on Example #1: Target Net Income Per Job. But do you know how much of your time actually goes into each of your projects? If you don't have a good grasp on this, you may need to record the time you spend on everything you do for a whole week. In fact, if you've never done this, you should definitely try it for at least a week because it can be a huge eye-opener as to where you're actually spending most of your time. Clock yourself in and out of each task you do as if someone were paying you by the hour for your work on their project. Something like this could work:
9:00 am - General Email correspondance
10:00 am - Edit Jones Photos
10:30 am - Post-Process Jones Photos
12:00 pm - Lunch
12:30 pm - General Email correspondance
12:40: pm - Create slideshow for Jones Photos
1:00 pm - Blog Jones Photos
2:00 pm - Burn & Print Jones photos to disk
2:40 pm - Package Jones photos for USPS pick-up
3:00 pm - Leave Sari Family shoot
3:30 pm - Sari Family shoot
5:30 pm - Return home & begin backing up files
6:00 pm - Back-up complete, work day ends

After a week or two of doing this, you should be able to identify how much time you spend on each aspect of a job or project. You should also be able to take a step back and see where there's room to train someone else to take care of a few tasks- even if it was something like printing and packaging orders that would just be so much more valuable for someone else to take care of even if it were just one day of the week so that you could spend your time focusing on other things that were higher priority, or maybe it would allow you to take one more client, or spend a few more hours with your friends and family. Being in business for yourself doesn't mean you have to do it all by yourself. We are infinitely more productive when we can work as a team, which allows us to focus on the things that we do best and are most productive doing.

Since this is the most straight forward answer in the grand scheme of things, I won't spend much time rehashing it. Just make sure you know all of your costs involved in offering that product before putting a simple price on it. Know the raw materials, shipping, and packaging cost for each item you offer- so that it can be fully accounted for in your pricing.

Putting It All Together

Here's an example of what a job might cost after factoring in the overhead, production, and product costs. You can see that there's a large chunk of each job going directly to overhead. Even if production costs were reduced by half, like if you had an associate who earns half as much, or by reducing your own salary, there's still a significant amount that goes toward the cost of simply running your own business:

Final Thoughts
Even though that was a lot to type out for you, it's really not more than a few hours of your time to sit down and actually crunch the numbers. The parts that require the most work is consistently tracking how much time you spend on each task associated with a project, and figuring out exactly how much your overhead costs are. Notice that NOTHING in this post talks about knowing what your competitors charge? That's because it doesn't really matter what they're charging- for all you know, they never even did the math to begin with and they could be out of business in two years! All that matters are the numbers you need to make your business work. Take the time to do the math now and you will save yourself loads and loads of headaches in the future. If you find yourself shocked with how much you should actually be charging per job vs. how much you're charging now, that's a good thing and it will help you better understand where you need to be in order to make the transition from part-time trap to full time passion!


Now that you're ready to tackle the numbers, check out this awesome Rate Calculator from and Cost of Business Calculator from the National Press Photographers Association.
Special thanks to Jennifer Grant for sharing that link in the comments!

Update: 11/17/08 Stacy Reeves just created an extended guide on pricing available as a free download from her blog. Check it out:

Anne Ruthmann is a lifestyle & wedding photographer from Boston, MA. She spent 10 years in the corporate & non-profit world before pursuing her passion for photography. When not behind the computer or camera, she can be found exploring the world with her husband. Follow her on Twitter.

Wednesday, February 6, 2008

Questions & Answers!

There's a little search box in the top left hand corner of this blog where you can type in any keyword related to your question and probably find multiple posts that cover the issue.  However, if you tried and didn't find any answers on this blog, please leave your burning questions in the comments link below and we'll do our best to give you answers! If we find that there are many similar questions, we may create an entire post around that question! Thanks again! Also, if you have an article or topic that you'd like to write about as a guest blogger, feel free to check out the info on How to Submit An Article to

Tuesday, February 5, 2008

Meet: Jillian Kay

I recently mentioned Jillian's new book, Dear Silly Lady, based on loads of valuable advice she's shared with other photographers about how to handle sticky client situations, and asked her if she would join me in sharing her wonderful wisdom on the photolovecat blog! To help kick off her contributions, I thought it would be fun to learn a little more about the woman behind the advice...

Jillian Kay Cocklin

Business Name: Jillian Kay Photography


Location: San Jose, CA

When did you start your business? August 2006

What services do you offer? Portrait & Wedding Photography

What products do you offer? I'm using a fabulous album designer (my sister), and I currently use KISS & Albums Unlimited for albums. I'm going to be outsourcing my editing soon, and I've chosen to work with Colorati

Are you home or studio based? At home right now, but I move into a small office on February 1st!

What do you enjoy about working from home/studio? I'm hoping that the office will give me a better work environment and a cozy place to meet with clients.

What have been the challenges of working from home/studio? Home is a little too distracting for me, and a little nerve-wrecking ever since my roommates disabled the smoke alarms.

Do you have any employees? Nope

What do you outsource and to who? My sister, Katie, designs my albums and Colorati will soon be editing my photos.

How did you acquire your photo skills? Sheer will of force. Also, a lot of forum reading. :)

How did you acquire your business skills? My parents instilled a lot of my people skills, I took a lot of leadership and management training at my company (as a software engineer), and I've gained a lot of information by listening to books on cd, and of course I ready forums and blogs fervently!

What do you wish you would have known starting out? Start off worrying more about getting a technically well lit and color balanced photo...don't start off worring about which photoshop action/filter defines your style. Your style will start to emerge in-camera & in your imagination...not by pushing buttons in photoshop.

What has made the biggest difference in your business? I'm still in the emerging I think I'll be able to answer this question better in a year. Overwhelmingly, though, people have made the difference. Engaging with other photographers and learning how and why they do what they do, helping others in any small way I can, and seeing by the examples of my peers that this industry can be very rewarding. People have strengthened me and caused me to push further than I would ever have dreamed.

What do you want for the future of your business? I'd love to see myself as a small studio, with a boutique wedding style catering to slightly off the path brides. I want my future to be successful enough to cut the engineering umbilical cord and give me the freedom to spend all of my energy in activites that inspire more energy!

What do you want for your personal future? I want to be more financially fit, more physically fit, and sleep more. :-) I also want to network more with photographers in my area, and build more local friendships in the industry.

What are you passionate about other than photography? I love shoes! I have a huge addiction to blog watching. I also find it difficult to tear away from tv shows about real-estate and interior design! I have recently started a collection of door knobs and drawer pulls.

Share a little about your home life: I'm single and currently live with 3 roommates in the suburbs. Our home is being demolished to put up condos, so I'll be moving soon (mostly likely back to downtown San Jose, yay!). I have three wonderful goldfish, who are the most animated and interactive fish I have ever met. I work a lot, but in my spare time I love to go out with friends.

My favorite quote, that I totally live by (for better or worse) is:
'Why Not?' is a slogan for an interesting life. - Mason Cooley

The current theme song of my life...I guess would have to be Times Like These by Foo Fighters, especially this verse:
I am a new day rising
I'm a brand new sky
to hang the stars upon tonight
I am a little divided
do I stay or run away
and leave it all behind?

Tell us a funny story about one of your experiences: I'm naturally brunette, but when I have a "blond-moment" it's usually of the "platinum" variety. Once I was a little flustered with a client, as I always get when I try to make a makes me nervous. They said they'd love to make a payment right then, and she started looking for her checkbook. He couldn't find his checkbook either, and they were terribly embarrassed. I, of course, wanting to be helpful offered to let them use my checkbook, and got it out of my purse. They stared blankly at me for a moment, and waited for me to realize why that wouldn't work. Then we had a great laugh, and just took care of the payment another day! Good thing I have clients with a great sense of humor. :)

That ranks right up there with the day I wanted to patent whole-wheat popcorn. ;) I'm a ditz.

If you have a question that you'd like Jillian to address on the blog, please leave a comment to help give her ideas about what to post!

Friday, February 1, 2008

Make Your Computer Read To You!

Did you know that you can get your computer to read out loud to you? Because photography and many other computer related jobs involve a lot of work on our eyes, our ears are often free to listen and learn while our eyes perform mundane tasks like editing or tweaking. Once you've discovered the joy of having someone (er... someTHING) else read to you, you may never want to read another long article or email by yourself again! It's also a great way to proof-read your work, since your ears may hear something that your eyes missed while typing. On a personal level, I have mild dyslexia, and have found this to be one way for me to reduce my frustration while reading large amounts of text.

Feedblitz Reader
If you've subscribed to this feed via email through Feedblitz, scroll to the bottom of the email and you should see a little speaker icon next to the "related" link. Click on the speaker and let the electronic voice read this blog to you! If the voice you hear isn't for you, you may have other, easier-on-the-ear voices pre-programmed into your computer!

Mac Users
I've been using the Mac Speech application for a long time now and I love it! On most macs, all you have to do is select a set of text and then click on the Application menu-> Services-> Speech-> Start Speaking Text. I have to say that Leopard's new "Alex" voice is the best voice yet and the closest to our natural speaking patterns, but you have many others to choose from, which you can see by going to System Preferences -> Speech -> System Voice. You can also set your own, easy to remember quick key to turn the speech options on or off by using the "set key" preferences.

If you want to get really fancy-shmancy, Mac even lets you adjust the rate, pitch, and volume of the VoiceOver Utility!

PC Users
I'm not a PC user, so rather than attempt to describe something I'm unfamiliar with, I'm simply going to link to the useful sites I found for enabling your text-to-speech capabilities..
Windows XP
Windows Vista

Adobe PDF
Adobe Reader also has built-in text-to-speech, Read Out Loud capability..

Natural Voices
After doing quite a bit of searching, I've concluded that many of the commercially available speech-to-text programs out there simply utilize the main operating system's installed voices (and charge you extra!) However, I was able to find two websites that seem to be the best resource for natural sounding TTS voices, and some even have foreign accents! for PC Users for Mac Users

So, the next time a really long email, PDF, or Blog post comes your way, try listening to it instead and see if it makes life just a little easier for you!