A complimentary cost of doing business calculator for portrait photographers. Enter what your studio costs to run, the pay you want and the sessions you photograph, and it shows the average sale you need from every client. Then it compares that with what you charge today.
Your cost of doing business (CODB) is everything your studio costs to run for a year, including your own pay and the tax on it, divided by the sessions you photograph. Add your cost of goods on top and you have the minimum average sale you need from each client. Example: $69,600 of overheads plus $80,000 take-home pay (about $106,667 before setting aside 25% tax), over 60 sessions, is $2,938 per session. With prints and albums at 20% of each sale, you need an average sale of $3,672.
What your studio needs
- Cost of doing business per session
- $2,938
- Break-even sale (no pay for you)
- $1,450
- Revenue you need per year
- $220,333
- Revenue you need per month
- $18,361
- Sessions needed at your current sale
- 89
- Yearly gap at your current numbers
- -$56,267
Where each sale you need goes
- Cost of goods $734
- Overheads $1,160
- Tax $444
- Your pay $1,333
At your current average sale of $2,500, you are $56,267 a year short. Raise your average sale to $3,672, or photograph 89 sessions instead of 60.
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How to work out your cost of doing business
- Add up last year’s overheads from your books: rent, marketing, software, insurance, accounting, equipment, staff and everything else.
- Add the pay you want, grossed up for tax. $80,000 take-home with 25% set aside for tax is $106,667 the business has to earn for you.
- Divide by the sessions you can realistically photograph and sell in a year. That is your cost of doing business per session.
- Allow for cost of goods. Divide by what is left of each sale after prints, albums and frames. That is the average sale you need.
- Compare it with your real average sale. The gap tells you whether to raise prices, sell more per client or photograph more sessions.
The formulas behind it
- Pay before tax = take-home pay ÷ (1 − tax rate)
- Cost of doing business per session = (overheads + pay before tax) ÷ sessions per year
- Average sale needed = cost per session ÷ (1 − cost of goods %)
- Break-even sale = overheads ÷ sessions ÷ (1 − cost of goods %). This is the sale where the studio covers its costs but pays you nothing.
- Sessions needed at your current sale = (overheads + pay before tax) ÷ (current average sale × (1 − cost of goods %)), rounded up
If your numbers come up short
Most studios that run this find a gap. There are three ways to close it, and they work best together.
- Raise the average sale. For a luxury studio the money is in wall art and albums, not the session fee. See how to sell luxury wall portraits.
- Book more of the right clients from the leads you already get. Faster replies and better follow-up usually beat cheaper leads. The maths is in It’s Rarely the Leads.
- Budget your ads from the sale you need. Once you know your target average sale, the photography ad calculator shows the leads and ad budget it takes to fill your sessions.
Frequently asked questions
What is a photographer’s cost of doing business?
It is what it costs to run your studio for a year, including your own pay, divided by the sessions you photograph. It tells you the least you can charge per client before you are working for less than you planned, or for nothing.
Should my own salary be part of my cost of doing business?
Yes. If your pay is only what is left over, your prices can look profitable while you earn less than an employee would. Put a fixed take-home number in, plus the tax on it, and price from there.
Is cost of goods part of my cost of doing business?
Keep it separate. Overheads stay much the same whatever you sell, but prints, albums and frames rise with every order. This calculator treats cost of goods as a share of each sale, so a bigger sale carries its own product costs.
How many sessions a year should I plan for?
Use what you actually photographed and sold last year, not your best month times twelve. Each session also takes time for the consultation, editing and the sales meeting, so more sessions is not always the easiest way to close a gap.
How often should I recalculate?
At least once a year when you set prices, and any time rent, staff, ad spend or your product costs change. Email yourself your results so you have last year’s numbers to compare against.
Know the sale you need and want more clients who spend it? Apply to work with Studio Digital.
These figures are estimates from the numbers you enter. They are not financial or tax advice. The example inputs are made up, not Studio Digital client results or industry benchmarks.