Track Your Margins
Track your margins. I mentioned earlier that it doesn't matter if you have the highest sales revenue in your market, you can still be the one making the least amount of money. You have to think about what your profit margin is and maximize your offerings to constantly do that. When we have, we mentioned a little bit, we were talking on break about how when I had wedding packages set up, I had them set up where I would make a great revenue, but then by the time I got done paying for the album and the album design and all the little things that I added in the package to make it look really nice and robust, there was not that much profit left. And I thought it was gonna be a great, great money-in-pocket kind of deal. And so when I started looking at what I was selling, what was in that package, I realized line by line I could move things out that were costing me and put things in that were costing me very little, but just present them in a way that was beautiful and cool and neat. A great...
example might be I would add a slide show on DVD to take home with you as an additional gift offering, but now pull the 100 thank you notes I used to pay for, for printing. The one costs me nothing because I've already done the effort, I've put it together. The other one would cost me something like, I don't know, 50 bucks, 75 bucks. And you do that line item, by line item, by line item, and what you're end up left with is a package that your clients think looks great. It's still a lot of items, it's beautifully presented, it's well-designed, but you're now saving $300-400 a transaction. Sometimes it's that simple. Look at what you're selling, how much is it costing you, and how can you mitigate the expenses to improve your margins?
I'd imagine that includes also how you spend your time on your business, so if you're cutting time by outsourcing something, well, you've earned more and more time for photo shoots, for relaxing, resting, thinking about your money, planning things, right?
Yes, very specifically when it comes to your time, I did the math on editing, outsourcing editing, I say right now I am a huge fan of outsourcing mass editing. And, mass editing, I'm being very specific there. I actually love editing, I love post-processing. I love finishing an image that I just was so happy to shoot, so happy about how it came out, can't wait to present it. I don't mind doing that here and there, but sit down with three portrait shoots to edit and get done in x amount of time? That doesn't happen quickly, it's not where my passion is, it's not where I'm best. I would much rather outsource that and take that time to do a portrait session, and let me say, let's talk about that time. If I'm doing one portrait session then I'm shooting about 500 images, I'm delivering about 60, roughly speaking. I don't ever hold to a count, but roughly speaking I'm in a two hour session, I've shot about 500 images and I'm delivering about 60 of them. I come back and I've got to cull those images. I've got to sift through them one-by-one decide what to keep. I then have to edit it for the color or for the black-and-white, or crop them, set them all up, do some portrait retouch on the faces, etc. So for that one session I'm spending maybe two to three hours kind of getting it together and that's when I'm shooting well and happy about it. And I'm doing three sessions a week, that means I'm spending nine hours a week editing, whereas if I outsourced it and paid I don't know, let's call it 150 a session because I want them to do everything, right? I really want a generous editing, and that's high, let's say $100 a session. If I'm paying $300 to outsource nine hours of work, but I can now fit in two more shoots, three more shoots, where my average sales rate is more in that $3200 range. Bajeebas, why would I never outsource mass editing? You have to have your business set accordingly, you need to have your marketing engine going so the shoots are coming in. You need to sell really well, so you're getting that average sales that you want to have. All that should be in place, but even if you're 1/10 of that as your sales average, you still do better outsourcing what you don't love and focusing on what you do love. Financially, you do better. Stress-wise, you do better. Happiness with your job, you do better. And you are now getting better and better at what you love, because you're shooting more, so you're improving there. So you're going to market better, you're going to sell better. Better, better, better, better, better. Do you see it? It's back to the idea of thinking, where am I spending my money? And if I zoom out and zoom out and zoom out, does that make sense? On paper does that make sense? No, it doesn't make any sense for me to sit there and work three hours for every shoot because I can't afford an editor. I'm never going to be able to afford an editor unless I slowly wade into it. I'm going to stay stuck here in this space I already told you I don't like, because I don't think I have the money to go here. I don't need to go there, I just need to go here, and then here, and then here. Patience, but I have to move forward and the way you move forward is you try it here, you try it here, you start seeing the results, you keep going. But you don't stay here and just complain about it. You can't. You can, but it's gonna suck and you're going to go out of business or you'll never really start. Don't just sit here and complain about it. Go a little bit, a little bit, a little bit.
It almost sounds like business for you is a zen activity. If you can keep yourself focused and effortless then you're good, and if you're not you have to think, why is it the case?
That BTS video I showed you guys when we started out, like how much fun it is to run around with the kids, and just that light and that spirit and that expression and that connection and all the things I'm looking for in my life, that I get to be in this wonderful flow of when I'm shooting, I am saying no and no and no to more of that, because I want to sit in a dark room, on a screen doing a bunch of stuff I hate for most of my week. Why would I do that to me?
When you decided to outsource your editing, which I think sounds fabulous, did you increase your prices, or just try to schedule more bookings? B. I would say A and B depending on where your prices are, but I felt like I was already charging my session fee and I was already an average sales rate that I liked, my average sales were already what I wanted so being in that space, in terms of feeling really good about my enough, I liked my enough. I didn't need to get more and more and more. I was really happy, I am really happy shooting the clients, photographing the clients that I'm photographing, doing the amount of sessions I want, and not much more than that. I just want to do less of the stuff I didn't like and more of the stuff I wanted to do, because that's a currency for me, you know? Why did I work so hard in my non-profit work, because it's soul currency. I am getting so much value out of that, because I know what my enough is. If I keep raising my prices, and keep raising my prices, and keep raising my prices, what am I turning down that I actually love to do that enhances my life? It goes back to me deciding what is enough, what makes me happy, and how do I spend my time in a way that actually generates more of what makes me happy, and cuts out the stuff that is sucking my life force out of me, sucking me dry. Because I can't show up to a shoot and run around and have fun and laugh and be so lost in that moment if I'm thinking, now I've got to go home and edit this for nine hours. That kills it in advance. I've already crushed my spirit, and I haven't even picked up a camera yet. For me, but that's why I want you to think about it, like to get really conscious about how many things are you doing just because you've always done it that way and you've already decided that all these other ways won't work for you because x, y, and z.