When making the change from hobbyist to professional, many of us don’t dig deeper into the costs of running our new venture like a profitable business. A few hours going through some numbers and doing the math can yield some surprising, and many times eye-opening, realities. The saying, “You don’t know what you don’t know,” makes a resounding thud in the pit of our stomachs when we realize that our time and talent is being wasted simply by not doing basic Business 101.
When creatives decide to open our own businesses many of us get caught up in the “fun” parts of the job, but then do ourselves a disservice by not understanding what we need to be accountable for so the business is truly a business and is profitable. Rob Adams and Charles King give a great rundown in their segment of what it actually costs to create and maintain a videography business from the very beginning to the eventual reality of sustaining the venture. King supplies his breakdown of costs for a new videographer in a very simple spreadsheet (that is also available to you to download in the show notes) to allow an easy understanding of the cost-of-doing-business for hourly profit when you're starting out or after a few years of working through the ups and downs of self-employment.
Though the video centers on videographers, any photographer or creative can plug in their own numbers and figure out their true income and hourly value. There’s a million things to do as a new business just starting but it’s incredibly valuable to every self-employed creative to really dig into their numbers and make sure they set themselves up for profitability, sustainability, and success before they spend months and sometimes years making very little for all their hard work. Four or five digit invoices to clients may seem like hitting the jackpot, but what really matters is if you truly understand how that income hits your bottom line after everything else including yourself gets paid.
Did you go through the cost of doing business breakdown, and if you have, were you surprised by the hourly wage you're paying yourself? If you need more help with making your business sustainable and possibly adding another vertical like commercial clients, the Fstoppers' tutorial “Making Real Money: The Business of Commercial Photography” with Monte Isom is a great place to start and truly set yourself on a path to success.