Shutterstock Photographer Forum :: View topic

srichey · Joined: 03 Jan 2010 Posts: 331 Location: Phoenix, AZ

Have any of you been successful (or unsuccessful) at opening a storefront studio? If so, would you mind sharing your thoughts on the pros and cons of doing this?

Obviously the high overhead costs is the biggest concern. But something wonderful came up for me recently that will really help me to cover expenses. So, I was thinking of giving it a try for a year. There is a great corner space available on a street in the best part of the town that I live in. It has very high foot traffic and lots of upscale shops and restaurants. It is a few doors down from a high end pet boutique that refers me most of my business. There is a huge bridal store and a popular children's clothing store right in the same area. My home studio is really holding me back because it is so small and I feel that it is too unprofessional for the type of clientele that I am starting to get.

I have a friend that is a wedding photographer that might be willing to pay a monthly fee to display some of her work and meet with clients. I was thinking that if I get one or two others that do other types of studio work like children/families/boudoir to rent the space part time, it might be a very nice collective. There is a university nearby with lots of interns that can do some of the office work. Since I do pets, I can resell a lot of my photos as greeting cards, prints, photo novelties, etc.

Should I go for it? Besides the expenses that I am already aware of, what else should I be considering?

Thanks in advance for your help. This is a very scary decision.

hhltdave5 · Posted: Sat Jul 14, 2012 9:04 am

Susan I'm not sure just how much experience you have with the actual "business" end of it so if you already know this just disregard.

There will be expenses for the creation of the business such as creating the LLC or the Doing Business As. There are also local ordinances that will have to be considered such as licensing within the town, and having any potential inspections done. Most cities have certain requirements for photographic studios. There is also insurance to think about.

Also are there any other studios like this in the area that can be competition?

Aside from that if the financials work out in your favor it sounds like it could be a potential good move. If you decide to go with it good luck!

srichey · Joined: 03 Jan 2010 Posts: 331 Location: Phoenix, AZ

I do already have a DBA and sales tax license. Good point about the LLC. I have been considering switching from a sole proprietor to LLC for a while. Now would be a god time to do that. I have 2 million in liability insurance for my home studio already and I have equipment coverage so I would just need to make some modifications to that policy. I didn't even think about the city inspections. Thanks for that tip. I'll look into that.

There are no pet photography studios anywhere around. There are a few pet photographers but they mainly do on-location photography. Now that I think about it... I may even be able to promote their work for a referral fee since I only do studio work. There is a wedding/boudoir photographer a few streets away. That might be an issue for any photographer that might rent space that specializes in those areas. That's something for me to consider.

Thanks so much for your help, Dave!

rudyumans · Posted: Sat Jul 14, 2012 9:24 am

Switching from a Sole Proprietor to a single member LLC is useless. It is OK if you have multiple partners, but if it is just you, an LLC has no advantages. What you want then is an "S" corporation.

A city inspection is usually done automatically when you apply for your license of Occupancy (or whatever they call that in Phoenix)with the city and the county

Having a wedding photographer already in the neighborhood is not necessarily bad for your friend. People like choices.

srichey · Joined: 03 Jan 2010 Posts: 331 Location: Phoenix, AZ

Rudy - Doesn't the LLC shelter your personal assets in the event that someone sues you? Am I misunderstanding that?

rudyumans · Posted: Sat Jul 14, 2012 9:42 am

srichey · Joined: 03 Jan 2010 Posts: 331 Location: Phoenix, AZ

Thanks Rudy. This is very good information. I will meet with my accountant on it. I would be the sole owner on the studio and other photographers would just rent space from me. So, maybe I don't need to make any changes right now.

rudyumans · Posted: Sat Jul 14, 2012 9:52 am

I added something important to my post while you were typing.

srichey · Joined: 03 Jan 2010 Posts: 331 Location: Phoenix, AZ

Great points, Rudy. I do have waivers and agreements. I would be so appreciative if you could review them for me. I will PM you. Thanks so much!!

jeffbanke · Posted: Sat Jul 14, 2012 10:22 am

If you want to protect your home and cars and such, talk to lawyer about a Trust. I am about to do this myself, since then technically you don't own anything, and everything belongs to your trust, no-one can go after you because you don't have anything :-)

srichey · Joined: 03 Jan 2010 Posts: 331 Location: Phoenix, AZ

Jeff - Yes, I definitely do want to protect all those things! I will look into a trust. I don't even have a will yet. I really need to take the time to get all that type of stuff in order. Thanks for the advice.

rudyumans · Posted: Sat Jul 14, 2012 11:47 am

rudyumans · Posted: Sat Jul 14, 2012 11:48 am

got your PM Susan. Already PMed you back.

mattgibson · Joined: 11 Nov 2009 Posts: 607 Location: London

Basic business stuff first.....

Supply and demand - is there more demand than you can supply for at the moment?

If you increase your supply by having a store will any additional demand (in the form of profit, not turnover) cover the additional costs - If not then why bother?

Staff and employment - taxes, mediacal, etc. With the best will in the world you can't be there every hour the store is open and you do not want ot start closing the store during advertised hours - what happens if you get asked to do a location shoot and it can only be done on a weekday - who watches the store?

Do you know what margin and turnover you need? What do you need in the form of margin to not only pay for thhe store but pay for you to live and put food on the table? Fuel costs? Mortgage/rent payments?

As an example, if your living costs and $2000 per month and your bsiness costs are $2000 per month then you need $4000 net profit - do you know what margin you can operate on and what your average transaction/sale needs to be? To break even you need to generate $4000 per month without taxes, etc. If your average transaction is $500 then you need 8 sales a month, two a week - but that is a high average transaction so half it - now you need 16 sales a week at $250.

What will your marketing costs be at start up and ongoing?

Blah, blah, blah, sorry to go on Susna but I looked int othis briefly a while ago in UK and it was frightening. I needed to have a turnover of around £10,000 per month to have a store and maintain the lifestyle my family was used to. Sounds ridiculous but think about it - approx 33% in tax and 5% in national insurance in UK so straight away that's 38,000 gone, mortgage, food, car, fuel, etc, etc was in region of 3000 per month for lifestyle, store costs on top of that were approx 2000 per month so i would have needed a turnover of six figures just to break even.

My point is I suppose is that it would be a major risk and commitment. Just make sure your eyes are wide open and make sure you TRUST your accountant!!!

rinder99 · Posted: Sat Jul 14, 2012 4:05 pm

Susan. One of the other folks in Monument Valley is Rob, He is retiring from the service in a few months and is opening a studio and frame shop, I would contact Him and touch base. I had a huge Place in the Late sixties in Laguna Beach. But what I experienced was so long ago that that Info wouldn't be relevant today. Just be sure to get a strong client base and have a AD budget and watch the stress levels. The biggest problem is digital, It has pretty much killed the brick and Morter Photo business. Not many could do film and process it, Now everyone is a Photographer or they think, LOL.

rob.gamble@mac.com,