Yesterday evening, I received a troubling email from a student athlete at a Western-Canadian University, who we’re going to call Frank for the purposes of this story. (Frank is obviously not his real name, but I like the name Frank for this purpose).
First of all, I’m not going to be losing any sleep from the loss of sales to these individuals. The fact that they are only willing to pay $1.00 per image, which is less than the $1.33 + tax you would spend on a small coffee at Tim Hortons (or Starbucks), devalues the quality of photography that we provide on a regular and consistent basis for our various local and national clients.
I generated the following response to him within 20 minutes of receiving the email late at night:
So, the question that I ask is: does Frank make any valid points, or does he not understand how a photography business operates?
I could have made $6, what am I thinking!!! /s
Let’s analyze some of the items that Frank stated in his email:
… instead of making $6 dollars off of me buying 6 photos which you’ve already taken and don’t need to do anymore work for you make $0 dollars.
Frank’s (poorly worded) statement is entirely false.
Is it true that the University of Saskatchewan has a contract with our company that pays us a specific amount to cover the various events that they hold each week, including CanadaWest and CIS Championship events? Yes.
Does the value of our contract cover the full cost of us covering their events week in and out? No.
We designed the cost of our contract with the University of Saskatchewan on the basis that parents and student-athletes would have an interest in purchasing our quality photography, and thankfully, they have. It also hasn’t just been Saskatchewan parents but we have sold to competing University parents and student athletes that see the value in our service, including bulk orders for all images from a competition of a specific team.
The money that we make on our website from these sales make up for the lower cost that we provide to the University, our client and to help run the website itself (more on this in another section below).
A prime example of our contract not covering the true cost of photography coverage is Huskie Football. On a given football game day, we have three total photographers covering the event to ensure that all of the requested and required photos are captured so that we can fulfill our contractual obligations. (If you have ever attended a Huskie Football game, you will understand that a lot goes on during pre-game and that a single or even two photographers can not cover everything by themselves).
By the time that I pay my two other staff members (you don’t get good photography for free, you have to pay your staff a fair and decent wage for the time that they are putting in to create the quality images that we create on a regular basis), I have to find a way to supplement my personal earnings for the event.
Why do we as a company continue to provide the coverage that we do for football with three photographers? Because the online sales of football action, headshot and team photos to parents and student athletes each year supplements our personal income on a game by game basis.
The second part of his statement, “don’t need to do anymore work”, is also entirely false. The average order that is placed through our website requires us to spend at least 10 to 15 minutes processing it. Sometimes this time frame is even greater depending on the size and complexity of the order.
This time spent includes verifying that the payment has been made and processed successfully, that the order information has been sent and captured properly by our custom order system, cross referencing our image database to not only find the photo but in some cases also re-editing the photo from the original RAW file, uploading the files to our file server and adding the proper links to our download database, adding the download reference to the order and notifying the customer via email that the download is now available.
When prints are ordered, add more time for us to properly edit the image for and resize it for print, sending it to Don’s Photo (our preferred printer of choice in Saskatoon), picking up the prints when they are completed and mailing (with free shipping) the prints out to the client via crush-proof envelopes.
Bulk Barn/Wholesale Club Pricing
Let’s analyze another part of Frank’s email:
Have you could make more money, if you lowered your prices… … I would be willing to pay $1 for them each… …. I bet you would make more if you lowered the price cause more people would buy your photos.
Once again, let’s disregard the horrendous English. Since signing on with the Huskies to a contract for photography services 6 years ago, we have been providing parents and the student-athletes with online sales (something they did not have access to previously). When we started, our pricing structure was as follows:
Digital File: $15.00
4×6 Print: $10.00
5×7 Print: $15.00
8×10 Print: $25.00
Shipping for any prints: $2.00-$4.00
With that pricing, we did well, but there was room for improvement and greater sales. Since that time, we have played with our pricing structure heavily each year, dropping and raising the pricing, until coming to the conclusion that the current pricing structure that we use is the most ideal to capitalize on the highest number of sales, while providing the best value to the client that we can. Our current pricing follows:
Digital File: $10.00
4×6 Print: $7.50
5×7 Print: $10.00
8×10 Print: $20.00
Shipping for any prints: FREE
You can see that our prices are the lowest they have ever been and we eat a lot of the cost for prints (we use crush-resistant envelopes that are more expensive, are heavier and therefore cost more to mail). Another photographer friend and I were chatting about this issue late last night. From 2006–2008, we worked together almost every weekend at sport tournaments in North Battleford, Sask. and sold on-site prints. He reminded me that at that time, a decade ago, pricing for digital files were closer to $100.00/per image and the 4×6, 5×7 and 8×10 costs were, on average, $10 to $25 more than what my pricing sits at now.
He recently got back in to shooting events and asked me if he could use the pricing structure that I have. To his surprise at a curling event, he did very well and is now using the same pricing structure for all of his events.
Photography over the years has gone down in price substantially, but the costs for photographers themselves has gone up. We make up for these lower costs by going after the volume of sales.
Working for less than minimum wage
Let’s touch on the one dollar aspect of Frank’s statement: A lot of people will buy only one photo from us, the average order has us processing 2.5 images. If Frank or one of his teammates were to only order one image, for example, his $1.00 + tax, minus credit card processing fees and the associated cost for my bank account (Monthly fee divided by the number of average transactions, including deposits in a month) to receive the deposit from our credit card processor, would leave me with around $0.25.
25 cents to process the entire order.
Given the steps and time above that it would take to process the order, I’d be working for $1.00/hour, or 10% of the minimum wage in the province of Saskatchewan. This. Is. Outrageous.
Who in their right mind would work for such a small value of money? This is part of the reason why our pricing structure is where it is today. My time has a value, and I’m well aware of what that value is. For $1.00/image, it would not be worth my time to even receive the email and view the text that is contained inside.
Ecommerce True Cost
Let’s also touch on the hidden part of Frank’s message that people don’t seem to understand when operating a business online: The true cost to run an ecommerce website.
Credit Card Processing. As a business, if I’m not accepting credit cards, I can’t make money. We use Stripe on GetMyPhoto.ca and JoshSchaeferPhotography.com to provide out customers with secure payment options where we never see or store their credit card information. We are 100% PCI compliant by doing this, and can process Visa, MasterCard, AMEX, Visa Debit and MasterCard Debit cards. This serves almost the entire population with their payment options. We are charged 2.9% + $0.30 for every transaction placed on our website. A $10 order, $10.50 after tax, sees us transferring $9.89 to our account.
GST and other Taxes. We collect and remit to the Government, as per Canadian Law, GST on all of our sales. This value is held in savings until our remittance time comes each year. We are also charged Canadian and Saskatchewan Taxes on all of the income that we generate at a rate of around 35–40%. On the $9.89 that is being transferred to our bank account, $0.50 is placed into savings. Another 40% is socked away in savings for our business taxes every April. $5.63 is left.
Website and Server Costs. It is not cheap to operate a business like ours online. We have over 46,000 images in our database (With another ~75,000 to be added in April 2016 when we begin Dance Festival season). In order to protect our brand names, we own approximately 15 domain names and have our own Virtual Private Server to run both GetMyPhoto.ca and JoshSchaeferPhotography.com. We also have CDN’s (Content Delivery Network) which stores a lot of our files to ensure that our website is fast and responsive (monthly cost) as well as SSL Certificates so that the information you are providing to us is transmitted securely. On top of that, our email is hosted by Google for both domains (monthly cost) and our supplementary storage for our client file uploads and tertiary archival purposes is done through DropBox. In total, Our annual website costs reach into the neighborhood of at least $2000-$2500 USD. We pay in Canadian funds so with the Canadian Dollar being where it is today, you can see how this hurts us).
So, let’s take the $5.63 that we had left over from the one image ordered, and realize that it doesn’t even cover 15% of the cost of running the server for a month. So now, we’re left with $0.
Staffing Costs. This one is huge and not directly related to ecommerce, but the business as a whole. Good people don’t come cheap, and I have access to some of the best sports-action photographers that are available in Saskatoon. There is a reason why the quality of our photography on a regular basis cannot be matched by competing companies.
Gear. We usually attend events with no less than $80,000 in professional gear. In most cases, that number is closer to a combined total of $125,000. We are not a fly-by-night operation using kit lenses and $600 cameras that you buy at Christmas time. We cover some of the largest events and festivals in the province, and our clients trust that we know what we’re doing when it comes to capturing the images that they need. You need great gear and the knowledge to go behind it. That’s what we provide on a regular basis.
[Author’s note: This isn’t intended to be a contest about camera gear. Rather, I’m outlining the fact that we spend good money on the gear that we have in order to provide the best possible photos to our clients. We shoot in low-light conditions nearly 80% of the time which causes us to have to have f/2.8 lenses across the board and cameras that perform well at higher ISO ranges.]
Other. Although it’s not directly related to running an ecommerce business, as a business I have costs. I operate with insurance for both my business, gear and vehicle. I pay rent to have a roof over my head and fill up with gasoline in my car to get to each event I cover. And as a human being, I provide myself with food on my table on a daily basis. I work as a full-time freelance photographer, I do not support myself with any other supplementary income from a regular 9–5 job. 100% of my income comes from photography and the work that I am creating on a regular basis.
So, earlier in the article I asked, “does Frank make any valid points, or does he not understand how a photography business operates?”
It’s my belief that none of the points that he made are valid, and that he doesn’t understand how a photography business operates.
Are you, reading this article, a photographer/videographer or someone in the events related field, and having to deal with the same type of issues where you as a professional have the experience, knowledge and gear to cover these types of events or are working in low-light situations where no one else has the skill and gear to capture striking photography, and are becoming so undervalued that the work you are producing is worth less than a small black coffee at Tim Hortons/Starbucks?
The mindset of some people needs to change. Photography has a value. Videography has a value. And they have these values when you are providing a service that no one else has the skill to.
As photographers, you need to charge what you are worth. You can’t work events for free as it will devalue the service the other professional photographers in your region are providing. A fair wage for a fair amount of work is what is needed. If people that are interested in hiring you can’t see this value, then it can not feasibly be worth your time.
All I know is that regardless of Frank and his Track and Field team’s opinion, I’m still going to sleep well tonight.
The views expressed above are those of Josh Schaefer and GetMyPhoto.ca. They do not reflect the views or opinions of their clients.
About the author: Josh Schaefer is a professional sports, action, and event photographer based in Saskatchewan, Canada. He’s the owner of GetMyPhoto.ca and the official photographer for Huskie Athletics at the University of Saskatchewan. You can find more of his work and connect with him through his website, Instagram, and Twitter. This article was also published here.