So You Want to Start a Photography Business in Florida...
Aug 31, 2013 | By: TJ Towers Photography
So many people today are picking up a camera and think they’re a photographer because they can take “great images” with their camera in Auto Mode. Come talk to me when you can produce the same consistent quality imagery over and over again, no matter what the challenges are. Then tell me how you’re a pro photographer; until then, get out of Auto Mode. The funny thing is that the artistic piece of owning a photography business (actually creating the images) is only 10% of what you do as a business owner. The other 90% is running a business and if you don’t run your business well, you’re going out of business. I tell all my students who want to be a photographer for a career to do themselves a favor and take business classes and marketing classes. Want to major in photography, that’s great, get a minor in business and/or marketing. 98% of photographers (if not more) work for themselves; National Geographic isn’t hiring a whole lot of staff photographers these days.
Now this will in no way be everything you need to know and do to start a business here in Hillsborough County, Florida, but it’s a start. You still need to do your own research, talk to a lawyer and accountant and find out what works best for you and your situation. What I’ll be writing here is from my own personal experience.
First, you have to decide, do you want to be a sole proprietor, corporation, LLC, partnership, etc. Don’t just flip a coin and decide to be a sole proprietor. Get professional advice and think about the future. If your company gets larger, a sole proprietorship probably isn’t going to cut it. Is that worth doing over again later, or is it worth the expense now? Also think about it from a liability standpoint, but you’ll have to figure that out on your own.
Most important is your branding. Your company name, your company colors and the products you sell (there’s marketing science behind all of it). Do you want to be the Wal-Mart, the Tiffany’s, or somewhere in-between in the industry? Do you want to work day and night and compete on price? Then be a Wal-Mart and be the cheapest in town. Do you want time to yourself and with your family? Then consider being something in between or higher end, where quality and relationships are more important. What I do know is that photographers that sell all their images on a disk for $150 don’t last in the business. Not if they’re running a legal business and are providing for their family.
So, what do you need to operate a legal business in unincorporated Hillsborough County, Florida (if outside of Hillsborough most of this will apply to you, you just have to find out your own county and city requirements. If within the city limits of Tampa, Plant City or Temple Terrace, check on your city requirements as well)? Keep in mind that most of this is required to open a business banking account in the United States since 9/11. I can’t stress this enough, almost ALL businesses in Hillsborough County are required to pay a business tax to be running a legal business, to collect taxes all these other areas need to be completed as well as one registration usually requires one of the others. You can get yourself in a legal jam by not registering your business correctly, not to mention that you’re basically cheating and abusing the system over those who are doing business the right and ethical way. I’m a bit passionate about this part… J
Depending on the type of entity you are, you will need an EID or Federal Tax ID number, which can be one and the same. You can get more information on the IRS website here. This is free but you will file your federal taxes with this number for the business.
You will also need to charge state tax on your services and products, so you must register with Florida Department of Revenue here. If I remember correctly, the registration is free then you will pay 6% tax for your business tax on all sales you make.
If you do business in Hillsborough County, you will need to register with the Hillsborough County Tax Collectors office and purchase your annual Occupational License, you can find information here, but will need to go directly to the Tax Collectors office near you to purchase the Occupational License. This cost can vary depending on if you’re working from a home office, leasing space, etc. I work from my home office and pay about $25 a year. You will also collect 1% sales tax for services and products sold and file this with your FL Department of Revenue filing.
I suggest you do your own research but the way I understand it, as long as you’re not in the construction industry and you have 3 or less employees, you are not required to carry workers’ compensation coverage. If you have 4 or more you are required to carry it. You can find more information on the website for the Division of Workers’ Compensation.
If you plan on photographing clients in Hillsborough County Parks, you will need to obtain a Photography Vendor Permit for EACH portrait shoot or face fines and possibly jail time. The still photography rate for a half day is $37.45 per shoot or for a full day $80.25. To receive a permit, you must carry $500,000 coverage in general liability, personal advertising injury and per occurrence. Average cost of liability coverage is about $360 a year. You can find out more about permitting by calling the Office of the County Administrator at 813-987-6240.
You should really be part of a trade/industry organization like the Professional Photographers of America which will run about $350 - $400 per year. Check out PPA here.
Of course, none of this includes cost of logo creation, website, domain name, email accounts, etc. Then there’s the pricing issue which is an area that many business owners struggle. Most newbie photographers try to mark up the physical products they sell so it looks something like this…I bought my 4x6 for $5 so I’ll charge $7.50. The problem with this philosophy is you’re not charging for all that went INTO making that print. What about the time you took to meet with the client? Travel, time spent and gas? Post production time? Did you have assistants? I’m sure they want to be paid. Production costs? Does this take any of that into consideration? No, but it should. That doesn’t even include living expenses and the cost of doing business. Remember all those fees I mentioned up at the top? Your business should pay for that, it shouldn’t come out of pocket.
Let’s look at a simple budget sheet and I’m going to give you realistic numbers for my family of 5 to live a not-so-extravagant lifestyle. By realistic, I mean what my family necessities are, nothing over and above, and I won’t even include food and clothing to keep it simple or the fact that we’re planning for child number 3 in February 2014. I may round some numbers as well.
Before I get into that though, some of you may wonder why I would include my entire cost of living instead of splitting it with my wife’s income or just listing business expenses. One of our family goals is to have my wife work with me, so I’m planning ahead. Let’s play devil’s advocate though and consider this, what if my wife gets laid off and I’m the only provider? Has a baby and doesn’t get time off for maternity leave? What if she gets hurt and can’t work? Throw any “what if” in there you’d like, life happens and I’d rather plan than react as a business owner. Realize I’m probably under estimating a lot of the business expenses below.
Major Cost of Living Expenses - Monthly
Rent - $1300
Electric - $200
Phone (cells are all we have) - $200
Water - $100
Auto & Renters Insurance - $200
Gas - $200
Car Payments – None (I put this here in case you do)
TOTAL PERSONAL EXPENSE - $2200
Monthly Business Expenses Working from home (sharing some above expenses like electric, water, rent so if you have a studio you would need to add those expenses below)
Advertising - $200
Bank Fees (monthly and credit card processing fees) - $50
Dues & Subscriptions - $50
Equipment & Furniture (stuff gets old and worn, plan ahead) - $200
Office Supplies - $100
Camera Equipment (gets old and breaks, plan ahead) - $200
Lighting Equipment (gets old, plan ahead) - $100
Printing & Reproduction (brochures, direct mail, etc) - $50
Professional & Legal Fees - $50
Liability Insurance - $30
Business Supplies & Expenses - $150
Website & domain, etc - $60
Video - $25
Music - $375
Training & Education (always be learning) - $100
Outsourcing Post Production - $1300
Supplies to be resold (cost of products and printing) - $7000
Salary (you should pay yourself, I’m working to get there, but eventually I would like $40,000 yr) - $3400
Assistants - $1000
TOTAL BUSINESS EXPENSE - $14,440
TOTAL MONTHLY EXPENSES - $16,640
TOTAL YEARLY EXPENSES - $199,680
So the supplies to be resold, outsourcing, assistants costs are based on 286 sessions per year. If you take the total yearly expenses of $200,000 and divide that by 286 sessions shot per year you would need an average sale of $700 per session. If you take 52 weeks in a year and subtract 2 weeks for vacation that leaves you with 50 weeks to work meaning you would have to average 5.75 shoots per week. Don’t forget, you also have to do billing, marketing, accounting, purchasing, etc. to keep your business running along with balancing family and church (if you’re a believer) time.
Hopefully, this gives you a tiny view of what it takes to run a photography business or really any business, and I’ve barely scratched the surface here. So, if you’re considering being a photographer, realize it’s more than just taking photographs, it’s about running a business. If you want any chance at all in being able to survive in business, you need to figure out what your entire expenses look like and charge appropriately. Marketing is essential to your business, if you don’t market where do your clients come from? A website with some awesome photographs isn’t going to cut it in today’s competitive market.
Want to read information backing up what I’m saying? Check out ASMP’s (American Society of Media Photographers) website. This is for commercial photographers, but all the same main principals apply Licensing Guide. The NPPA website has a “Cost of Doing Business” calculator if you’re looking for a simple and basic way to figure this out: Cost of Doing Business Calculator