Studio Photography dead?

<p>With certain studios closing down recently I want to ask the community if you all think studio photography is 'dead'? Not talking about commercial or high level but the studios that are low cost. Take a photo print it out in 8x10 and deliver within say...an hour. Low income, high volume. <br>

I came across a studio for sale in my area (Arizona). Not too expensive and looking at their records from the previous three years, their profit is significantly high. Curious why they are selling? Been doing it for over ten years, husband and wife, and are tired of working. They want to retire and not have the pressure of the business anymore. Work 350 days a year open 10-7. I understand that you all would need more information but ask me and I will let you know (if I know).<br>

I am meeting with the owners on Saturday and want to know what you all think. Maybe offer some advice as to what I should be worried about. <br>

The purpose of this post is to see if it is worth investing money and time towards this type of photography.</p>

<p>High-end studio photography (prestige advertising work) is alive and well but not paying the fees it once did, run-of-the-mill commercial photography (e.g. mail-order catalogs) is on the endangered list, a lot of it is being done by graphic designers rather than "professional" photographers, and social photography is not what it was - blow people's socks off with stunning images that DON'T look like something they could do themselves and you can still make a good living, much lower-end work has disappeared because people are doing it themselves with automated cameras and finding the results more than acceptable (it probably didn't help that professionals offered reportage-style wedding pix - a style that at least LOOKS easy to copy).<br>

With specific reference to the studio you are looking at, I would think that it would be difficult to move away from the high volume/low margin business model which the present owners seem to have pursued - is there any market for high-end social photography (for example wedding photography packages for $2500 - 3000 and up) in the area? The crucial questions for you are how badly do you want to be in this area, is there any potential for high-end work, and just how hard do you want to work? Building any business takes hard work, but killing yourself is not recommended! I wouldn't touch this business, but I'm not you - I'm 64 years old and my motto is "Work smarter, not harder!"!</p>

<p>Will they let you "try before you buy?", if not then I'd be careful. Books seldom tell the whole story and can also easily be doctored if the people aren't honest.</p>

<p>And speaking of books, I'd be more interested in seeing their income tax returns to see if they match their books.</p>

<p><em>Books seldom tell the whole story and can also easily be doctored if the people aren't honest.</em><br>

This is true - but I somehow don't think they would say they ...<br>

<em>Work 350 days a year open 10-7.</em><br>

if it wasn't true - it doesn't make the business sound more attractive!</p>

<p>Thank you for the responses. I am not relying solely on the books. I did ask them to have some paperwork together for our meeting, more specifically their tax filings. They are only closed for major holidays (Thanksgiving, Christmas, New Years, etc...) At most they are closed 15 days a year. They are old(er) and are simply tired of working so much. They do the pictures for Pop Warner Football teams, some of the local amateur sports teams, and the local elementary and middle schools. That generates their large incomes and the day to day walkins provide some income. <br>

Another concern is they have ZERO internet presence. I cannot find them other than a yellow page listing and they told me they do not know how to use FaceBook nor do they have a website. Yet I see people on facebook asking others in groups for phone numbers and location to that studio. Would an internet presence harm the business?<br>

Mike - How would I approach the current owners on a 'try before I buy' idea? Let me work with them for a few weeks to see the process? </p>

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<p><em>"Would an internet presence harm the business?"</em></p>

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<p>Ernest, I can't see how an Internet presence can harm a business if implemented intelligently and updated regularly. Established local small businesses or sole proprietors such as attorneys, accountants, real estate professionals, roofers, plumbers, usually rely on word of mouth, but those who use the Internet intelligently also benefit greatly. Example: Scotty Kilmer is an auto mechanic working out of his driveway in Texas - his YouTube channel has over 80,000 subscribers and 26 million views:<br>

<a href="http://www.youtube.com/user/scottykilmer">http://www.youtube.com/user/scottykilmer</a></p>

<p>I think buying an established business is an advantage if you're entrepreneurial and able to bring new ideas to modernize and breath new life into it. As for working days, it might be possible to open by appointment only giving you time to develop the business in new areas.</p>

<p>"Try before buy" is only useful if you intend on taking it over as-is and continue its operating formula. I think it'd be far more fruitful if you put together a carefully developed and considered business plan on the assumption of taking over the business but renewing its business model. <br>

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<p>Their business model is high volume low cost and that is what you'd be buying into. If that's not what you're wanting then there is no reason to buy their business in the first place as changing a successful proven business model would probably destroy it. Having done that kind of work in the past I can tell you there is virtually <em>no</em> creativity involved (which can really burn you out if you actually <em>do</em> have any creativity within you), you're just working on an assembly line doing the same repetitious type of shot over and over again for hours on end. If this appeals to you then go for it, but if not, then run! This is why I suggested a "try before you buy" in the first place, so you can see if this kind of work is for you.</p>

<p>When it comes to setting up or buying into creative businesses, and trying to figure out where you’re going, one very valuable concept is “1,000 billable hours a year”. Earn your living working no more than this and you have a good chance of staying fresh and sane – work more and the risk of burn-out increases exponentially.</p>

<p>What would you actually be buying here? Property, or goodwill, or something else? <br>

Their marketing for all those years likely will not accrue to your benefit, will it? Was their marketing personal to them rather than to their nearly invisible business entity? If so, how will you benefit from buying it? <br>

If they are in the Yellow Pages and not on the internet then what have they been doing to market their services to make those incomes? <br>

I sell professional services too, and I can assure you that marketing is the primary thing you will have to master to make a services business successful. I would be concerned about how much built in marketing benefit you would actually be getting. </p>

<p>Not a pro photographer, but I've been in independent business for going on 20 years.</p>

<p>First thought: You can lie to yourself (ie, cook your books) and you can even to a certain extent lie to the IRS (ie, fudge your tax returns). But its pretty much impossible to lie to the bank. </p>

<p>Ask for three years of bank statements. </p>

<p>Jeff, that is great advice. Study the bank statements! </p>

<p>Many responses:<br>

1. Studio photography isn't dead--it's very alive. But having a dedicated studio is expensive...it's why some businesses in a range of fields have ended their brick and mortar presence and go online. Or why some food vendors use food trucks/vans rather than restaurants/cafes. Plus entry into the photography field is not only easier (there are so many full-time people who do photography on the side) but public perception is that it's all about the camera. Doesn't mean that studios are going the way of the dodo bird, only that a studio is not the only way to do portrait business.<br>

2. My experience from a VERY long time ago is that successful studios either have a tremendous visibility or they have a very defined niche with deep contacts in that field (say....kids' sports teams or weddings). While you'll get all sorts of walk-in business of a wide variety, it's hard for a small studio to be successful trying to be a jack of all trades.<br>

3. In terms of decisions about buying an existing studio, yes, the books and tax records are important. But I don't think they're your most important factors. For instance, do they have key clients that they have contracts with--like sports leagues or schools or businesses (who you'll likely retain)? Do they have target/niche markets? What percentage of their business is just unsolicited "walk-in" (which means it comes from word-of-mouth, physical location/visibility, luck, or past reputation)? You could buy a studio that is profitable on the books and via their taxes--and then lose horrendous amounts of cash the first year you own it....b/c the primary clients leave with the owners or a big contract with a school system expires.<br>

4. Owning a studio--if that's where most of your business is going to come from--can be a huge life changer and a weight if you're not ready for it. If you can't afford staff or receptionist, than you're tied to the studio on semi-regular hours (rather than just showing up when you have a shoot scheduled). You'll need to have good insurance.</p>

<p>Joe very good information! I spent the weekend with them and assisted with a sports team shoot. Very intense and as someone stated earlier, assembly line operated. But it is a studio and that is what I expect now. I do shoot weddings and though we rarely take our cameras and equipment out for less than 250 an hour, the market here is full of 'photographers' that charge significantly less. Though we do still get new clients regardless of the saturation of people starting out (which is more than likely the case in every town/city), my wife and I stumbled upon what seems to be a wonderful opportunity. The amount of profit is high and we anticipate losing some of that when the previous owners move on. <br>

A little difficult to explain but I will try as I am always seeking advice especially from this forum: The current owners will provide us with a transition period of three to six months. This is worked into the business plan and in the offer that we have submitted. If it were not for the male owners ailing health, they would not sell. There is no loss or risk of loss to the customer base. Just spending the weekend with them was a good eye opener as to how they operate. Before the offer is finalized I am planning on working side by side with them to get more of a feel on their processes, which we will fall in on. <br>

During the transition period we, the new owners, will be introduced to every client and the current owners will arrange meetings with their points of contact on the contracts. During the meetings we will provide an understanding to clients that there is no risk them renewing contracts with us, the new owners. The contracts are with the city and rely heavily on the sports teams. <br>

Current marketing is very low as the reputation of this studio is held highly among the community. Word of mouth is insanely high as this is the only studio of such a caliber to produce the professional imagery clients expect. We will continue this and learn the current successful practices during the transition period. They lack internet presence and we will implement a strong one. Website, social media pages, etc...What they do for marketing now is mail out fliers with discounts, small amounts roughly 10 percent that lures customers in. It is effective. <br>

Initially, we (my wife and I) do not intend to hire a receptionist. Yes, I understand the amount of time that we will spend and have factored that into our decision to purchase. A lot of work but it will benefit us in the future. We do have teenage children that we could employ of course during the summers and on. For large events such as the soccer teams here where there are over 1,500 players to photograph, we will reach out to other photographers. <br>

They currently have great insurance and we will carry that over. We have reviewed the monthly and annual overhead and factored that into our budget. Some adjustments to our P&L Reports will be necessary but for now, we have a firm grasp on what we need to make, our bottom line, and where we want to be.<br>

I really appreciate all of the information! Please keep it all coming!</p>

<p>Ernest, it sounds like you're doing your due diligence. Be willing to rethink the model. I know of some "studios" that don't have studios. For sports teams they rent space at a local elementary school and the kids show up for the team and individual portraits. For instance, shooting a sports team at your own studio means you probably need about 35 parking spaces (so you don't have big gaps between one team and the next...so you're shooting one team that takes up 10-15 parking spaces, another team is already there filling out paperwork, and a third team is arriving. You turnaround a team--team and individual poses--every 30-45 minutes).<br>

If you're going to shoot high volume clients (kids sports leagues, church membership directory, etc.) then you really need to think about how to be visible in that market and have a receptionist/market person. For instance, if you were going to shoot local youth soccer teams in Northern Virginia (my area), you'd want to know about the all-star tournaments (that happen twice a year) and see if specific leagues will contract with you to shoot at the all-star tournament. You're going to want to be known as the "go to" studio for youth sports (or soccer) so that means making contacts with the local leagues, maybe buying ad space at a field, taking free pictures of the league board of directors for the website), offering to help stuff team registration packets at the start of each season...as long as you can insert a flier about your studio, go to a DCU United game and shoot from the sidelines at least once so you have credibility with the parents and kids (you have a couple of professional game photos showing in the studio when the kiddie teams show up for pictures). That's what I mean by niche marketing. Same thing if you're going to be known as a wedding studio. Or a pet photography studio. Or a church studio.</p>

<p>Ernest,<br>

I have been on the other side of your problem. Five years ago I decided to sell my studio that I have owned since 1972. (I worked there from 1962). It was just such a nightmare dealing with potential buyers who had little money and too many demands. Instead, I changed my mind and turned it over to the employees to run with my helping on big jobs. Seems to to going ok. Our Studio portrait business is fair, nothing like it was in the seventies and eighties but I never depended on studio portraits to make a living. Studio revenue represents about 20% of our income. We do a little of just about everything, low end, mid range, and high end. Over the years when one portion of business went soft, other portions grew. All studios I think are dealing with the fact that everyone has a camera now. Our dollar volume is down, our biggest gross year was just before digital came in, $550,000. Now we do $390 to 410,000 but our lab costs have been cut by 70%. All in all it is a wash. The biggest problem I have now is paying three people to do what I used to do.</p>

<p>Rick, without knowing details, ~$400k/yr sounds pretty impressive to me for a 3-5 persons small business.</p>

<p>There is a local studio that has been in business at the same location since 1956. I've been there a few times for passport photos and have always wondered how they kept their doors open. It's a modest venue and everyone in the area knows them but I haven't been there for a few years.</p>

<p>Well, this thread prompted my curiosity enough to search for them on the Internet fully expecting a hodge-podge website with a 1980s theme, but boy, was I wrong. Apparently the father (founder) had retired and the business was taken over by his two college-grad sons who have transformed the place into something modern and unrecognizable.</p>

<p>Photography, once its core business, has now become complementary to a host of services they now offer - fully up to date and well ahead of the pack. I don't know if they're doing well, but if appearances meaning anything, they sure look like they know what they're doing and going full steam ahead:<br /> <a href="http://www.cashin.ca/services_photography.php">http://www.cashin.ca/services_photography.php</a></p>

<p>It seems apparent that the traditional business model for photography studios will have trouble sustaining itself into the future unless they reinvent themselves, especially those who do not have a solid business history.</p>

<p>I think it's an excellent way to go broke. The failure rate is probably worse than restaurants, and that is very high. When I lived in Tucson 15 years ago I met one person after another that had closed their studio, and I wasn't even in the photography field then, I was painting and showing in galleries.</p>

<p>If you want to cure yourself of the photography bug, running a business like you describe should do it in a month or two. About 30 years ago, I contemplated working for such an operation, which the owner described as "mining coal, but above-ground." A lot of his work involved setting up in high schools and shooting a head shot of each kid in each class just as fast as possible. I guess he sold lots of prints to the kids' parents as well as to the school. I still shudder thinking of it.</p>

<p>You are getting some good ideas/suggestions here. Having been in and out of jobs/studio work/freelance for many years it looks to me that brick-and-mortar studios are an endangered species. I knew a guy who built a very busy studio out of nothing. He was super flexible in what he would do and what he would charge. I think you have to be more so today. I'm so danged old I remember when people looked up to photographers (before my time photogs were given the honorary title "Professor" because they knew so much about chemistry.) Now everybody thinks they can write and take photos thanks to the Big I which will take on anything like the neighborhood doxy. I say good luck.</p>

<p>I have been away from this forum for a few weeks because of the Dance Studios we photograph this time of year. I will tell you Ernest that we generated over $45,000 in the last month just from Dance photography. There still is money in photography but it has more to do with off site shooting than it does with money generated from a studio. But, a studio gives you credibility in generating other revenue off site. It has always been that way for me, now 51 years in business. The off site stuff leads to business in the studio and having a studio leads to business off site. Other posts here make a good point. I absolutely loved photography until the moment I bought this studio in 1972. Then it became a headache. Running a business is not easy. But, I have to tell you that I have had one job in my life and I still enjoy shooting. I don't know of many people who still enjoy their job after all those years. I am now debating to keep going or fully retire. I am leaning toward keeping shooting till I drop. Best of luck to you.</p>