Sounds like an odd question doesn't it? Well in reality it's something that you should always be thinking about. If the world has shown us anything over the last decade it's that you can't be too careful. So what should you do?
This is something that I think we all struggle with. None of us really ever want to think of a time when our business might not be doing ok. In reality that's fine to not think about failure of your business, but what about failure of your current and potential customers? Did you take the time to figure out what you would do if the market turned sour again?
The idea that we would see another 2008 era collapse happen again is something that most think could never happen. Well a lot of people thought that before 2008 as well and where did we end up that time. The fact is that history in this country always tends to repeat itself and it will do it again, the reason being, because we let it happen.
I regress though, back to the topic at hand. What are you doing to protect your company, your employees, yourself, your family, and your investments if something goes wrong? If you are the sole bread winner in the home, or if you are single and run your own business, such as being a photographer, do you have a backup plan? Now some of you won't need to worry about this. There are markets out there in the photography business that wouldn't be affected by a downturn in the economy. Ok, just kidding to see if you were paying attention. There is not a single avenue that wouldn't suffer some type of downturn if we saw another 2008 or worse.
Get educated! That is the first thing that I tell people. This doesn't mean that you have to go back to school in your free time, it means that you need to educate yourself on the things around you. Find out what is really going on in the world as a whole and not just your area of your town. Education is underappreciated and under utilized in this country. I don't mean that piece of paper that says you spent $60k and passed some tests. I mean real world life experience education. This is the most important thing you can ever do for yourself.
Next, don't always rely on someone else to handle your money. I know you might now be a financial expert, but those that thought they were back in 1987 and 2008 proved that they really had no idea either. There are a million ways to invest your money, and you should take responsibility for learning some and handling it yourself. No one understands your ability to handle risk better than you do. You know if you can handle ups and downs or if you just want something stable to make to retirement.
Diversify. Are you a photographer that only handles shooting real estate or only does weddings? What happens if the real estate markets crash again? Where will you earn your income from? Do you have the ability to photograph other things well enough to sustain yourself? If you don't, you certainly should. I get asked all the time what kind of photographer I am, and my answer is always the same, I am a photographer. Yes there are certain fields that I excel at better than others, but I diverse enough that I can photograph weddings, real estate, automotive, events, news, sports, and just about anything else. You need to start doing the same. Stop being just one type of photographer and broaden your abilities.
Save, Save, Save. We in the photography business have a tendency to buy new gear entirely too much. Some think that having the newest and most expensive gear makes you a better photographer, when in fact you just spend $6000 on a camera body that you are taking the same photos with as before. Stop trying to keep up with everyone and actually save that money. If you get paid $350 for a shoot, how much of that are you actually saving? Are you living gig to gig right now? If so then it's time to diversify so that you have enough gigs to start saving money.
Work more efficiently. This is something that again I tell people all the time. I hear from friends that shoot weddings and they tell me that it takes 6 weeks or more to get clients their finished shots. Are you insane? What could possibly take that long? Is this a case of overshooting or over processing. or what? The more efficient that you can complete the work, the quicker you can move on to the next job. It isn't that you don't care about the job, it's that you need to turn these jobs around right away. Don't shoot a wedding and then take two or three days before you start to edit it. You then lose the vision you had at that moment.
Studio space, do you have it and how much does it cost? One of the things that I personally have talked myself out of is a stand alone studio space. I have a garage and spare rooms in my home that I could use. So why spend that extra money on a space unless you are so booked 6 days a week that you are turning work away. Use the space that you already have and are paying for instead of adding more debt on top of it.
Get rid of debt whether it be business or personal. I don't care what anyone one tells you, long term debt is a worthless instrument or tool to have. It's one thing to have short term debt, i.e. 12 months or less, but what do you need to carry all the other debt for? What happens to you if the business slows down? Do you have a way to pay for everything then that you do now? If you eliminate the debt, you eliminate more of the fear. You have the ability to concentrate on the business instead of concentrating on the debt and paying all those bills.
Insurance, everyone hates it until they need it. You do realize that your homeowners or renters policy doesn't cover most if any of your photography gear unless you have a separate rider. Nor does it cover you in the event you are sued by a client, you damage something on location, etc. Get yourself real business insurance policies. Make sure that your insurance policy on all of your gear is an RCV (Replacement Cost Value) and NOT ACV (Actual Cash Value). I will delve further into that in another blog. Also make sure that you are covered for liability and that you have lost wages coverage of some sort. It doesn't hurt to get extra secondary insurance in case you can't work due to illness or injury as well. Yes you will hate paying the premiums, but if you ever need it, you will thank me.
Finally, learn about your community. Who are the main employers in your area? What is the average starting wage? These are all things that you should look at and pay attention to. I for example live in Chattanooga and know that Unum, Amazon, VW, and the hospitals are the big employers. Why is it important to know that? It's a way for you to know how stable your market is. Take for example Amazon that is located here. I have an idea of what they pay entry level and I know that they are a big employer. If I saw that they were laying people off, or read in the national news that Amazon was having issues I would pay attention to that. All those people and even Amazon itself is a potential client as well as your neighbors, family, etc. The risk of losing a larger potential client base is something that you should always pay attention to.
I hope this sheds some light on things that not everyone likes to talk about. And this isn't just about the photography business either. This applies to every business out there. Small or large. Take care everyone and continue to follow your dreams and be successful.