Pricing as a Small Business Owner

This month’s blog post from Emma Lord Photography considers something which can be a difficult subject for small business owners. Pricing.

Before setting up my photography business, I worked in the civil service. Here, I was the recipient of a wide range of excellent terms and conditions.

My annual salary was split into regular monthly payments, and covered the days I was at work, and also the days I took as annual leave. If I was off sick, I was paid. If I travelled for meetings, I was paid for the travel time and expenses. The staff canteen was subsidised, and I could claim back (within reason) what I spent on sustenance while working away. Equipment such as desktop computers, laptops, work mobile, stationery, and office furniture was provided. Office overheads such as telephones, water, electricity, and insurance were taken care of. Taxes and National Insurance payments were deducted automatically, and I was part of a pension scheme. Career training and development opportunities were funded, and I could work towards extra qualifications. I had support in my role from human resources personnel, information technology teams, and financial experts.

Representing the UK at an overseas meeting – expenses paid would have included work equipment, travel, accommodation, and food.

Reading back, it was quite a list! The reason for detailing all of these elements is to highlight some of the benefits of a salaried role.

As a sole trader, I don’t expect to receive anything like the level of benefits which the civil service offered. However, I am still working hard and trying to make a living. Some of the essentials which I need to fund include studio bills, business insurance, equipment – both specialist photographic equipment, and general office supplies.

Added to this list are the bills I have to pay at home, and essentials such as food. These are outgoings which I have had for much of my working life, but the difference now is that the household bills and the work bills are all paid from the same income. The service I offer requires mobility, so vehicle running costs and maintenance form part of the calculations. Any time not working, when I am perhaps on leave, is unpaid.

Then there’s the actual service. People pay for my time and my skills in taking photographs. They then pay for hard copies or digital images. In some ways, this is the ‘easy’ part of setting the charges. This is the part which people see and understand. The hidden element is the extra time of arranging each shoot, preparing for the session, processing pictures, and arranging a final follow up meeting. Part of my job is to run a smooth business which offers customers a relaxing experience, and they shouldn’t have to worry about what goes on behind the scenes.

The charges so far do not include any profit, which is the element which might be used towards non-essential items such as savings and leisure activities. These are ‘nice to have’ things, which are also the areas where the first efficiency savings are usually made.

Working in the studio

There’s a lot to consider, and I have met a number of art and design professionals who worry about their pricing structures. They fret that they are setting their prices too high. They overlook the fact that they are working to make a living from their craft, rather than making some extra money from a hobby. The prices they charge for service provision are not just paying for that service. The prices come together to provide a salary for the professional who is delivering the service.

If you worry about your own pricing, set some time aside to think about everything your income pays for. Then remember that what you charge each customer is a part of your income. You’re working to make a living from your profession and people who pay for your services will understand this.