Part 2 Photo Booth Pricing - Are you in the Race to the Bottom without knowing it?
[FOR PHOTO BOOTH , OR ANY BUSINESS, OWNERS ONLY, TUCSON AZ]
I think that one of the hardest aspects of owning a photo booth company, at least for me, is determining what to charge for your services. In our line of work, it's not as easy as just doubling the wholesale price and reselling the exact same item for twice the price. We have to figure in what our time, skill level, and experience is worth and convert that into Dollar signs!!!! Overall, we have to keep track of our business costs, our competition's prices compared to ours, and still be considered affordable in the demographic area we service.
So many people today are jumping on board the "Get Rich Quick on the Weekends with a Photo Booth Business" bandwagon with little knowledge of how much behind the scenes work there really is. These people are of the mindset that all they have to do is invest in a photo booth, and then price their services just lower than any other long term experienced photo booths companies in their area to give them the upper hand with bookings. The booth would pay itself off in a short time and they can start raking in the extra cash.
It's unfortunate that this happens because in reality all this is ultimately doing is decreasing the overall cost of Photo Booth Services in general as a whole. I can't count how many times I've been asked to offer discounts or give a lower price because Curly, Moe, and Manny all offer the lower price. I am NOT Curly, Moe or Manny, nor do I want to degrade the value of my Services to match a less superior photo booth. ValuePhoto Booth's provide a Unique and Memorable Service, and yes much of their performance can be based on sheer creativity and technical skill at the hands of the owner, designer, and/or operator. But when an uneducated customer looks at 2 identical packages with one from a new company and the other from a skilled, experienced, professional, and reputable photo booth company, they tend to go for the 5 hour deal. With increased competition comes decreased prices, and to use a phrase that describes it so perfectly, "the GREAT race to the bottom."
I would like to encourage new and old Boothers alike to not get caught up in this race. Know your worth and the quality of your product. Don't Settle and stoop to what everyone else seems to be doing, set you and your company apart from the norm and stand firm for what you believe is a good quality product for a fair price. Eventually you will see that the more you believe in your product, the more everyone else around you will as well. Here are some steps to follow when you find yourself contemplating your stance in the race.
1. CALCULATE YOUR COSTS
I have outlined in PART 1 - Formula for Success the steps to take to calculate your overall business costs and how to apply that to a baseline amount needed from each event you do. Please keep in mind that it is not exact, but rather a general formula to follow to help you realize what your costs are, and how to calculate for them.
2. PACKAGE EM UP
Secondly, I would suggest you find a system that works for you and come up with several package deals for your services that you want to offer. Be sure to have at least 2 or more different packages, but not 20, where one is more basic (bare bones), and one has all the bells and whistles. I have 3 packages and a specialty package that I offer to keep is simple and to the point. When creating your bare bones package, think about what YOU want the minimum requirements to be, while still making it worth your while to provide services. Same with the Max package, keep in mind how comfortable YOU are with providing the services and features that your thinking of offering. These are YOUR packages based on what YOU are confident in providing for service so make sure they align with YOUR knowledge and comfort zone. You can always add more later.
3. PUT YOUR STANDARD ON IT
So far, you know the minimum cost you need to make at each event, and what services you've practiced enough to feel comfortable providing them to paying clients. Now is the time to establish your "Standard" and slap an "Experience" on these puppies. Customers rarely call me up to get a quote about my experience being a photo booth owner and what standards I hold my business model to. Unfortunately it just doesn't happen that way. This is why you have to find a way to let them know regardless. Know where you stand compared to your competition and if you are on the low end of the scale, learn a new feature or something different to set you apart. In order to convey to a potential client that your photo booth is the best, you first have to be convinced of that yourself and have a list of reasons why. So for your next quote, try doubling your price and follow up with exactly what is included, what they can expect, and why this service is worth it.
Let's all start participating in the "Race to the Top" and reap the benefits communally, instead of degrading our businesses and lowering our standards and self worth to gain a dollar.
NOTE: There will always be 2 kinds of customers, the ones who will pay your price and the ones that won't. It is impossible to please everyone so don't stress yourself out trying. Identify your price range, your ideal clientele, and never negotiate outside of those terms. If you are too high for their price range, that's OK, simply state that your prices are already at the lowest point for the quality, service, and experience that YOU provide, however you can give them some referrals to a few other companies that might be more appealing to their price range, but may not necessarily be in other areas.....and just leave it at that. Sometimes that will seal the deal, either right then or for future events.
Here is a sample to follow from Mike Brooks, (author) from "The Real Secret To Staying Firm On Price" (https://www.salesgravy.com/sales-articles/pricing/the-real-secret-to-staying-firm-on-price.html)
“_________ I totally respect that you’re trying to do what’s best for your company right now, but the offer I’ve just made is the best I can do and still give you the (level of service, quality, value, etc.) that you’d expect and be happy with. If you can get this somewhere else and it fits within what you’re willing to pay, then I’ll just have to understand and hope that I can work with you next time. I’m here for you now, but the decision is up to you – what would you like to do?”