Part 1 Photo Booth Pricing - Formula for Success on Pricing Your Photo Booth Services
[FOR PHOTO BOOTH, OR ANY BUSINESS, OWNERS ONLY, TUCSON AZ ]
So you started a Photo Booth Business, Now What?
Here is some info that you can use for your photo booth company, or any other business, to assist in determining what your Annual Business Costs are, and what should be the Starting Price Point per Event during the year.
It's important to stay aware of all your possible associated business costs, including calculating your own personal salary, and how to come up with a Base Starting Point when pricing your packages and services. It is not set in stone and will not be the same for every person, however, its designed to provide a better overall understanding of your financial status, and a better understanding of your personal worth and core values. CONFIDENCE IS KEY! The more confidence you have in your product, services and self, the easier it will become to ask for and attain the prices you want for every event.
1. WHAT'S YOUR WORTH
So the first thing you need to do is determine what your costs are to run a photo booth. Most people think it would be the cost of paper and toner that they go through at each event. Yes that is the most obvious cost of a photo booth but first consider yourself. What are you paying yourself to work this event? You pay your workers, why wouldn't you pay yourself a salary or hourly wage also? In addition to the time you spend transporting, setting up, operating, breaking down, and loading at the event, how much more time did you invest preparing for this event? How many hours did you put into designing the template? How many hours did you spend on the phone or through emails to the client to give them quotes, explanations, answer questions, go over contracts, payments, and terms of service, finalizing proofs, as well as learning about their event and all the details of what they want? Don't forget the amount of time you put in after the event counts as well, such as uploading, editing, creating videos, reprints, canvasses, etc. and any time put into your follow up emails/phone calls to seal the deal. These hours should all be calculated into your total time working for this one event.
2. WHAT'S YOUR IMMEDIATE COSTS
These are the costs that have to be purchased or paid prior or at the time of the event so that your event can function as it should. Paper and Toner? Check. What other services/ products are you using at your events? Do you provide your own Internet Access in case the client's is unreliable? Do you have to Provide a Generator for power at outdoor events? Did the client want a scrapbook, usb, specialized props or customized picture frames? Do you use certain software or programs to run your booth or to provide all services and features client wants? What are they fees, if any, associated with those programs? (i.e PicPicSocial for online sharing, Smugmug,com for online hosting, Photo Booth Software purchase, upgrade, annual fees?) Do you rent your photo booth equipment? How much are rental fees? Additional Worker Wages? How about Transportation? How many miles are you driving round trip to transport equipment and/or workers to the event? Always calculate the miles for round trip to your events, even if you don't always return immediately. You also need to understand the term "Wear and Tear". This applies to your vehicle and your equipment. These costs are what makes your event run smooth and provide for all services and expectations your client has.
3. WHAT'S YOUR BUSINESS COSTS
Now it's time to think about all the other," behind the scenes" as I call them, costs you have of running a business. Include any costs that could be somehow associated to your Business.
Rent - Do you rent a space for your office or storage for your equipment?
Insurance How much do you pay a month for insurance to protect your equipment, company, workers, and vehicle?
Taxes - City and state taxes should also be calculated
Website Fees - Do you have to pay for your domain name, website, email client?
3rd Party Programs - How about a CRM or third party program to help manage your back end website and office demands?
Advertising - How much do you have to spend on advertising each month to get your business in front of the right people including offering free or discounted services?
Utilities - How much do you pay towards utilities for your Business such as phone and internet?
Financial Fees - What are your financial fees such as bank and cc Processing Fees?
Networking - What events do you attend or groups have you joined for a monthly fee to increase exposure?
Client Appreciation - How much do you spend on travel, meals, and entertainment for your clients? Supplies - What about supplies for your setup such as props, backdrops and stands, ipad stands, tables and linens?
Marketing Materials - How about marketing expenses such as business cards, shirts, banners, linens, and other promo products that have your logo branded?
Just to name a few. I think you get the idea though. So the next step is to determine how to calculate all these costs into a number that you can apply to each event you do as your baseline cost
4. WHAT YOU'RE REALLY WORTH
The best way to come up with a total is to calculate all these costs into either a monthly or yearly amount. If you pay yearly, divide by 12 to come to monthly amount or multiply monthly amounts by 12 to determine yearly amounts. Either way, we are looking for a total amount from Performance Costs and Overhead Costs by month or year. Once you have that amount, next determine how many events you do on average again monthly or yearly. Since photo booths seem to have their good and bad months, I recommend calculating the average number of events in a year. If you have not yet been in business a year, simply calculate how many events you would like to do monthly (i.e. I would like to have an event every weekend so approx 4 events a month/ 48 events per year). Divide your Monthly Costs into your monthly events or your yearly costs into your yearly events to arrive at approx average cost of each photo booth event.
Ex. My yearly costs = $14,000
My yearly number of events = 48
The approx cost of each event (granted you do 48 events that year) would be $291.00
This is a great starting point to get an idea of what you need to make on each event to cover the costs of running your business throughout the year. If you were to do a Photo Booth for any amount less than $291, you would be loosing money. If it was $291 even, then you would break even, and if it was more than $291, and you would make a profit.
Once you have read and performed the calculations outlined in this article, Please continue on to read part 2 of this Article Titled Part 2 Photo Booth Pricing - Are you in a Race to the Bottom without knowing it?