Whether you believe we are in a recession or you are simply seeing a slow down in your business, are you going to kick back and hope the phone starts ringing or wait for our government to help you out? The governments plan of course is to stimulate the economy by pouring money into it by issuing tax rebates to all US taxpayers, most of which have been delivered by now. Whether you agree with this philosophy or not, if you have been losing sleep wondering where your next job is coming from, you need to do more than sit by the mailbox waiting for a $600 check from Uncle Sam.
It never ceases to amaze me every time I am at a gathering with another group of photographers, whether at a convention, an association meeting or just the local camera store, the news is almost always the same--”I'm so slow.” “The phone is just not ringing.” “The economy sucks.” “Nobody wants to spend any money.”
Do I ever have moments of uncertainty about my business? Absolutely! I'm concerned about it 24/7/365. That's what you do when you own your own business, but instead of worrying and whining, I make sure I take steps to make sure I can keep the studio doors open and get clients in the door. Here are some tips to put a few extra dollars in your checking account.
Cut Your Expenses
This should be common sense, not only when business is slow, but why throw away money when you don't need to. I've been saying for years, that we are being nickeled and dimed to bankruptcy with all the monthly fees we have to pay. In the good 'ol days, people paid a monthly mortgage or rent, utilities, maybe a car payment and insurance. Now we have Internet fees, cell phones, alarm monitoring, cable or satellite TV, web hosting, photo hosting, portfolio hosting, yard maintenance, etc. Not to mention the constant cash flow required to keep technologically up-to-date—new computers, software, and the latest digital cameras can drain your bank account faster than a girlfriend with a diamond fetish.
What you can do:
- Shop for lower utilities-With certain utilities like electricity now deregulated, you are no longer locked to your old power company monopoly. If this is available in your area, make this one of the first things you do. By switching to a new electricity provider last year, our bills have been literally cut in half and all we had to do was fill out an application—the transition was seamless. After switching both our home and office, I estimate our annual savings to be between $2500-3500.
- The same holds true for phone service. Phone providers are great at two things, up selling you services you don't need and inflating your monthly bill. Do you even need a landline anymore? Many people have enough minutes per month with their cell phone service they really don't need another phone. In addition, most cell providers include free long distance or free night/weekend calling. In addition, if you really want to get with the times and save some serious money, you should be using a VOIP (Voice Over Internet Protocol) service like Skype.
Skype is owned by EBay, but don't hold that against them. This is an amazing service. Downloading the software is free and all you need is either a headset with a microphone or a separate microphone and speakers. If you have family, friends or clients scattered around the globe, if each person has Skype installed, you can make calls over the Internet for free. Or for a small monthly fee, currently about $2.50, you can make unlimited calls to any phone across the US.
If you choose to keep a landline or maybe you are required to for something like alarm monitoring, consider getting a minimum service. AT&T offers a rated line in our area that is $5.55 per month plus taxes and fees. You have a limited number or outgoing calls, usually 25, but unlimited incoming calls. We recently made this move at home. Between cell phones and Skype, we rarely used our home landline. We took our monthly bill from an average of $60 a month down to $12-15. That's an annual savings of roughly $500.
At the studio, we have used an alternate provider for many years, when AT&T starting calling to offer “cheaper” rates, I made a call to my current phone provider, Birch Telecom, and renegotiated our plan, thus saving another $50-60 per month. In addition to lowering my monthly rate, they included all additional features such as Call Waiting and Caller ID for free. They also threw in free long distance and free voicemail that we had been paying another $15 a month for. You might even consider alternatives for Internet access.
Many companies who offer DSL service have rate far below that of cable, with speeds that are plenty fast for most. AT&T even offers a little known DSL service which does not require phone service with them, as well as another low-end DSL service, both of which they were required by the government to provide in order to proceed with mergers. So instead of paying $50-60 a month for cable based Internet, you could be paying as little as $10-15 for DSL.
- Insurance- There is no check I hate writing more than ones for insurance (well maybe except for checks to the IRS), whether it's health, commercial, home, auto or car, it's one of those necessities. How long has it been though since you shopped your policies? This is something else we just completed, both for the business and the home. Not only did we end up with better coverage, with a better company, we also dropped our premiums overall. Combining as many items together on one policy can also save dollars through the insurance providers’ discounts. Ask your agent about other ways to reduce premiums by making upgrades to your home safety and security or appliances. We had a new a/c system installed last summer. I never thought that would lower my premium, but it did.
A few other cost cutting tips-
- Cook your own meals and pack a lunch. An average lunch at a restaurant these days will run you about $10.00. Multiply that by a couple hundred per year and you'll see the savings add up if you make a sandwich or take last nights meatloaf with you. Oh yeah, I guarantee it will be healthier as well.
- Search for free software alternatives before buying. My personal experience—I had been using a service for our studio schedule. Even though it was only $15 per month, I got tired of paying for it and the service had constant outages. The solution, we switched to Mozilla Sunbird. The software is free and we host the calendar on our own web server, with a local backup so outages are not a concern. Sunbird is a stand-alone application. Thunderbird is the outstanding email client from Mozilla. With Lightning installed, we can access Sunbird from within Thunderbird, although Lightning is still in beta and has a few unresolved issues in the current release.
- Buy used equipment. For photographers, digital technology keeps advancing at warp speed, but the curve is leveling off slowly. Although your digital files are only as good as the camera you are using, there are some incredible cameras that are now several years old, such as the Canon 5D or Nikon D200. I've been using a 5D since they first hit the streets, and for the money, it's hard to beat. Check your local camera stores or a reputable seller on EBay or Craig's List for a good deal. Finding a clean used one might set you back about $1500, as opposed to a new one for about $2500. The same goes for computer monitors. Prices have plummeted on flat screen LCD's in the last year, which means lots of folks decided to upgrade, flooding the used market with monitors of all shapes and sizes. If you need a piece of equipment for a certain job and you don't see using it much beyond that job, consider renting. Even if there are not rental houses in your area, there are plenty of good ones in NYC, LA, Chicago, Houston and Dallas that will ship rentals to you.
- Get rid of luxuries. Are you paying for cable or satellite TV? If times are tough, cut those services and grab a book or spend that wasted TV time thinking about other ways to make or save money. Better yet, go for a walk or spend time reconnecting with old friends and family.
- Conserve everything. Start developing good habits. Turn off lights and appliances when you leave rooms. Set your thermostat higher in the summer and lower in the winter. Using fans can greatly reduce your need to run the A/C at higher levels. Invest in a programmable thermostat so your A/C and heat shut off when no one is at home. I find this especially important at the studio. We are typically there for 9-10 hours a day and typically 5 days a week. The rest of the time, I only want to run A/C and heat the absolute minimum required to keep heat and humidity in check. Even though our studio is only 5 miles away from our house, since my wife and I are headed to the same place, we try to ride together as much as possible so we only have to drive one car.
- Clean house. Most photographers and artists I know have some form of packrat syndrome. Our professions almost require that we save everything. You never know when you’re going to need that 20-pound bag of fake plastic snow. And how about those 5 Hasselblad 500 C/M's sitting on the shelf along with lenses, backs and enough accessories to make NASA a little jealous?
As the old saying goes, “One man's trash is another man's treasure.” And while you certainly won't get rich selling your old equipment and collection of valuables (Come on, it's junk), it's not helping you earn money. It's taking up space and with the money you make, you can spend some cash on marketing materials--more on that later. Don't hold back. Start going through all your cabinets, shelves, etc and make a pile of stuff to sell. Separate it into stacks according to garage sale or on-line. This is about as common sense as it gets. Get rid of it by any means necessary. That means have a garage sale, a studio sale. Send emails to friends, associates and clients for some of the more valuable items. Selling on EBay or Craig's List is also a good idea. If you don't have an EBay account, it might be easier to have a friend with an existing account help you or go through a service that sells your stuff on EBay for a commission of the sale. Listings on Craig's List are free. Not only will you end up with a little extra green in your pocket, but also you'll feel better for getting rid of the clutter in your life.
Set aside a little time each day or each week to make some of these change. Quit giving away your hard earned dollars when you don’t need to and get rid of the clutter. In the process, you might find your life a bit more organized and your bank account a little healthier.
There's more to come; look for part 2 in the coming weeks.