Money Talk – Episode 016 – A Photographer Podcast Interview

On today’s episode of From Nothing to Profit, Kia and Matt talk about money. Listeners wanted to know how to choose what to sell and how to price those things, what to spend money on and what not too, and more, so Matt and Kia answer those questions in this podcast. Kia is always looking for new ways to hang client’s images on their walls, like super ornate frames or acrylics. Matt is always testing different versions of products to see which sells best. Make sure to take notes about how Matt and Kia markup their products to make sure their costs are covered and make a profit. Matt and Kia both keep a list of things they want to be able to purchase and things they wants to invest in, with that profit. Education is always high on that list, as well as large wall displays for their studios. You’ll also want to listen in to what Kia and Matt buy that they shouldn’t. Kia uses StudioCloud and Quickbooks, doing her own books and payroll. Matt used to use Successware, then switched to a bookkeeper with Quickbooks. Matt cautions losing visibility into your numbers when you start outsourcing your books. Know your numbers.

Books:

Profit First (https://amzn.to/2Ri24Gj)

Good to Great (https://amzn.to/2GFAz5l)

Resources:

Digit (https://digit.co/r/-ksipC9aI-?wn)

Read Full Transcript

Transcription was done by Temi.com which means it’s an AI generated transcript. The transcript may contain spelling, grammar and other errors, and is not a substitute for watching the video.

 

Speaker 1: 00:01 Welcome to from nothing to profit, a photographer’s podcast with Matt and Kayak where each week they talk to photographers about what is working in their business now so you can swipe those ideas and grow your business faster.

Matt: 00:16 Hey everybody, welcome back to from nothing to profit. So today’s gonna be a little bit different because Kira and I have gotten some feedback and some of you listeners wanted to hear a little bit more from us. So Kira and I came up with a theme today, what we’re calling the money talk because there’s been a lot of questions sent to us about this. So we’ll kind of go back and forth on these questions. But real quick, let me tell you guys the questions that people have asking so I’ll just run through them real quick. So what do you guys decide to sell or how do you guys decide to sell certain things? Um, how do you price items and how do you deal with markup now that you’ve made money, how do you know what to spend it on? What’s lead into questions like what are some really smart things to buy or use your money on and then what are some dumb or irresponsible things to buy? What do you buy a lot of and shouldn’t and should not buy. So that’s like what our, what our guilty pleasures that were like really bad about buying. And then how do you do your bookkeeping because in some previous episodes we talked about bookkeeping. Um, so how do you do bookkeeping it? And then there was a lot of questions around some more questions around profit first and what that’s done for our business. And then also some Dave Ramsey questions. So Kaya, I’m excited for this one. This should be definitely a good one.

Kia: 01:34 Yes. Yes. I’m so excited to be here and I think this is a, a, you know, a question that works in great with the, you know, the whole point of a from nothing to profit is, you know, what do you do with that profit and how do you create it? So I’m excited to be answering these questions today. I think it’s going to be great.

Matt: 01:52 Yeah. And I think it’s interesting that people wanted to hear a little bit more from us because, you know, we kind of designed it as this interview thing, but as we’ve been doing it for awhile now we realize like, well yeah, I guess we do have a lot to offer as well and people want to hear from us, so we’ll spring will sprinkle these types of episodes in here, especially around the new year here. Um, we’ll definitely get some in to talk about what we do around the new year and stuff as well. All right, so let me start with the first question. Kind of, so how do you go about deciding what to sell in terms of products and your business? Like, you know, when you, when you go to a trade show, how do you decide what to add? Not to add to what you’ve said, you know, all those different questions.

Kia: 02:25 This is a great question because I think, uh, you know, some of the things are obvious, you know, we sell, we sell portraits. And so the first thing that people used to ask about is how much are your eight by tens and now the next, the question that they ask are, how do I get the digital files or do you include them in your session? And so I think, uh, every year I want to do a couple of things. One, I want to create actual session experiences that are new and different and so sometimes that may include like go in some place specific or you know, making a really elaborate set for children’s session or you know, doing something like, you know, adding hair and makeup for families or for seniors. So I think it all for me starts with the experience and then I’m on the product side of it.

Kia: 03:16 Then there are so many different options that I like to be, you know, experiment with it. But I also like to do things, especially for my business that give my clients different things to put on their walls. And so, you know, obviously with digital’s you can offer like different, um, different treatments to the images. You know, you can do like a vintage look or hand color or that type of thing, which we have done in the past, uh, although I don’t think that’s really in vogue right now, but then for me, I’m always thinking like how can we create, you know, new and creative ways to present the images on the, on my client’s walls as art. And so that’s one of the main things that I look for, you know, is um, like frames that no one else has or you know, ways to frame the images that’s new and different from what I’m doing for my clients. And so one of the things that people are really liking is I’m like acrylic wall portraits, so not necessarily the metals but like, um, images with acrylic on them. And so they are more like clear glass and a little bit more contemporary. So that’s the direction we’re going as a lot of contemporary or super ordinate.

Matt: 04:29 That’s really good. I’ve seen it. I’ve seen a lot of those acrylics and we haven’t added them yet. Um, we saw them. One of the big trade shows maybe like two or three years ago and they were just coming in and I was like, well that’s something to keep an eye on, but I haven’t circled back to it so maybe that’s something that we’ll try this year as well. So.

Kia: 04:44 Well let me so well, so a couple more things. One of the things I like to do is like with specific sessions, if I do like a themed portrait session for children, a lot of times I try to create a product that goes along with it. So you know, I’ve done like a mud pies session and then Donna frame with it that had like hand prints in mud on the frame that then we lacquered yeah. So creating products that actually go with themes or you know, get people excited. So what, how, let me ask you matt, what do you decide to sell? Like how do you determine what products do you guys do?

Matt: 05:20 Yeah, so I mean we just don’t them very similar and I, I kind of think about it this way, like we kind of pick a focus for for a year maybe and we really dive into something and really test a bunch of things out. So I think we’re constantly testing and I don’t just test it for, you know, like a quarter, like we’re testing for a year. So two things that we’re testing right now that I kind of had two different outcomes. One of them is a standouts, which is basically just a wall art style where it’s printed on foam core and it’s like maybe an inch or two inches thick and then they finished the edge either in black or black and white or steel. Um, I think some of the companies have like a light wood and the dark web that they finished them but it’s just, you know, so like the picture sticks out from the wall, but the edges I’m finished and something that’s not a picture.

Matt: 06:09 And so we tested those and those really didn’t sell on our studio. We, we moved them around our studies, a couple of different places, but they just didn’t sell as well as like canvases and metals and image blocks and stuff like that. So that’s something that we’ve tested and they’re probably on the way out. This year they’ll probably would be taken off our walls because they just didn’t sell. I’m actually glad they didn’t sell because they’re one of the more expensive products to buy. And so the Qa, because we saw all of our walls are kind of at the same price. It doesn’t matter what finish you pick. There are all of our 60, my twenties are all the same price so that one had the least amount of margin in it so I’m kind of glad that one away is really way up on that one, so I’m kind of glad that one didn’t work out as well.

Matt: 06:52 But I’m the. One of the things that we tested that worked really well is image boxes and so we did a lot in the last year around that basically some kind of box that holds like 20 Matt matted prints and those sold really well. We brought in a ton of versions of them to see what sells and we’ve already removed a couple that, you know, just not to overwhelm our clients because they didn’t sell from the very beginning. Um, and then what we’ll do here around the new year is actually go in and look and see which ones actually sell, what samples we need to keep out because we want to keep it as simple as possible for our customers and also give them a variety at the same time. So we’ll clean that up and then that feels pretty good about that. That’s kind of wrapped up and then we can sell it for a couple of years until it kind of loses the energy and we have to revisit it.

Matt: 07:38 But we’ll pick focuses. Like we’ll pick it, we’ll, we’ll say, okay, this year let’s focus on Walmart and we’ll really dive into all the different options are we’ll say let’s dive into a gift ideas or gift prints or one thing we’ve done before. It’s like, what? What can we do for table tops? And so we’ll just dive into those. And really, I mean, once you get kind of get focused and clear about it, you can find a lot, a lot of options and then start pricing them out and figure out what’s going to be profitable, what’s not going to be profitable because there’s some stuff in the industry that if you mark up a certain way, they just become so expensive that the, that’s just their sticker shock on them. They don’t, they don’t have the value in the customer’s eyes that require, that is required to charge that much. And so some.

Kia: 08:22 Yeah. And that, that is one of the things that also helps me decide whether I’m going to do something or not, you know, is whether I can mark it up and make it worth the time to do it because there are some things that are on the next question. The next question, if you want to dive right into it. So like how do you price and how do you mark up your stuff? So typically what I do is, uh, I, I’m mark up things. So with photography it’s different. You know, my dad had a furniture store and so everything was marked up like double essentially and then if you you did a sale on it or that type of thing, then you made less than double. And so that was a typical markup. Whereas photography, it’s like 10 to 20 percent is what your costs should be because photography is not just a product, it’s a service and so a lot of the cost of the product is actually the time in creating it, you know, physically sitting are you sitting at the computer creating it the time you work with them. And so I look for things that I can do 10 to 20 percent markup, but then I also have my digital products which don’t have any cost of goods and so they will a lot of times offset things. So a lot of times I’ll package digital and physical products together where the physical product might have a higher cost of goods. But my digital does, you know, has very little cost of goods. It’s just more time. And then that gets me to my ideal, my ideal markup.

Matt: 09:50 How about so and so just to clarify, so when you say in like 10 or 20 percent, you’re saying like if you pay $10 for something, you want to charge $100 for it?

Kia: 09:58 Yes. Yeah. Because, and that’s just it. It sounds like an amazing markup and a lot of people when they start out don’t do that. And that’s why photographers I think have such a hard time staying in business when they first start out because they don’t realize that you have to charge so much for your time.

Matt: 10:16 Yeah. And so we do something similar like, so we just, this is kind of my baseline where to start and then we adjust it. I’ll explain that a second. But basically yeah, we, we take the cost of the product that it costs to actually order it from the lab and then like our time. Um, so we’ll budget like, okay this product is going to take, you know, x amount of time because it has five images in it. So it’s going to take that much time in editing and then you know, all the different time costs. And then we put a little bit of shipping in there just to save our, but if we have to ever ship it and then what we do is once all that’s bundled up, we kind of multiply it by four, which is like kind of a 25 percent markup or four times markup and that’s kind of my starting point and sometimes we don’t even stick with that number.

Matt: 10:56 But like when I’m shopping, I’m at a trade show or whatever. I’ll look, I’ll flip it over, look at the price and add some, you know, retouching time and stuff into it and say, okay, this is gonna. I could sell this for $200, I can sell this for a thousand dollars. And then it kind of says like, you know, and then I’ll take Alex and I both did that kind of separately and then we’ll take each other back to bruce and I. and I’ll pick up something and I’ll say, hey, can we sell this for a thousand dollars in her gut responsible? But yeah or no. And that kind of helps us narrow it down as well.

Kia: 11:25 Good way to do it because I think sometimes I’ll be like, there’s no way anyone’s ever going to buy this for this much, you know, just like you were talking about the standouts. We call them bamboos because we just put them only on bamboo and um, I, you know, when I first looked at them I was like, people are not going to spend that money on it and uh, but we have had a few people that did love them and did do it, but they were something that, that I would probably be like, you know, just, just looking at there, just don’t look as expensive as they need to be.

Matt: 11:58 Yeah. Because I remember one bamboos first came out to looking at him and thinking man, like, you know, this was me making up numbers, but like, you know, this canvas costs a dollar and those bamboo thing cost $7. Like it’s just like, that was just crazy that the market wasn’t going to work, you know. Um, but then, then one of the things that we do is we adjust it. Right? If something selling really well, we know we can raise the price a little bit and we don’t do that a lot, but like sometimes we under priced stuff often so like we’ll priceline at like at $400 and then we realize everybody’s buying it. It’s like well okay, that’s probably too cheap or we’ll play something at like $1,200 and we realized Oh, you know, it’s not selling so maybe it’s the price. And so if we still believe in the product, well we’ll drop it down to a thousand dollars and see if it sells and sometimes there’s just a little price thresholds that you can hit where things do sell, you know?

Kia: 12:45 Yeah. We also adjust ours based on how much time something takes. So for instance, an album a may not cost as much, but the time to create and put together the album is definitely cost prohibitive. So. So that’s something that I would charge more for just because it takes so much more time involved in it too.

Matt: 13:07 Yeah, that makes a lot of sense. Okay. So let’s move on to the next question because I think we’ve covered that pretty good. So now that we’ve made the money or the is made the money, like how do you know what to spend it on? Like how do you think about that?

Kia: 13:19 Well, I, it’s so funny because we doing that profit first book definitely makes a big difference, but I actually have a list that I keep and so for specific equipment for big events, things like that. And so I, once I know that I have a surplus, then I will, uh, spend it on those specific items and I definitely, you know, for me I like to, to invest in new computers, new cameras, uh, things that are going to make things go more smoothly and then definitely you know, samples that I can show in the studio. So those are the areas that I really like to invest in. And then education, I like to invest in that as well.

Matt: 14:03 Yeah. And I definitely think education is one of the top of our list. So we do the same thing. We make a list and then people are here. Here was the nuance I figured out a couple of years ago that I thought was really good for our business. So we say this thing around our studio and we say a broke list as a better list and when we mean broke, we don’t mean like broken lists. We mean like the list we made when we were broke, when we have no money is like the best list because when you have money and you start making a list, when you have extra cash on hand, like it’s amazing what gets thrown on there. It’s just I just like stuff we will never use, you know, we, we own the Lens Baby, a little lens and it’s one of those things that we bought that was not on the list that we bought when we had extra money and we’ve used it like three times, you know, so it, that would have never made the list if we would have made the list when, when we are in our slow season and had no money.

Matt: 14:53 So make start to make your, to do our year, to buy list when you don’t have money. So then when you do have money, you know exactly what you wanted because this is the different mental exercise.

Kia: 15:03 It’s like going to the grocery store after you’ve had lunch rather than when you’re starving. That’s exactly what it’s like.

Matt: 15:10 So what are some of the smart things that you think people should buy when they have extra money or things that they should invest at? You already said a couple but any others that you want,

Kia: 15:18 things that you know will make you money. So for me, if I like one of the things that I like to buy our props, so for me like backgrounds, chairs, things like that. And so if I know like each year I do a um, like a st nick’s set and so if I know that I can use it all year long besides just doing it for the St next set, then I’ll invest. So I might buy a pair of like vintage doors that are like a thousand dollars or $2,000, which seems crazy, but I will for sure pay it off with the actual sessions that I do. And then if I can use it for years to come, then it’s a smart thing to buy even though it’s super expensive item. What about you?

Matt: 16:03 Yeah, definitely repurpose and stuff. Yeah. So I think probably one of the smartest things that we have bought over the years is really big samples. And I think I gave this example maybe in one of our previous podcast, but we just went to like a local expo is like a women’s expo. And we had, there was like a ton of photographers there. There’s probably like five or six photographers there and we brought these huge, like 30 by 40 canvases. So when people were walking by they were like wow, you know, like if they made an impact and those things also hanging our studio every day and a lot of the other photographers had some kind of, you know, eight by 10 wall or something like that because that’s just what they sell. And they hadn’t taken the time to invest into wall samples. And so one of those, one of the things is like when we have extra money, it’s like, okay, let’s do a big display. You know, to test a product but also to see if it sells and sometimes you know, you put, you put 20 by 30 or 30 by 40 is on your wall so that you can sell, you know, you can sell 16 by 20, 20 by 24 hours, you know, if you just put 11 by 14,000, eight by tens on your wall, the time, you know, you’re just going to sell what people see.

Kia: 17:13 So we, we just did that. I’m invested even in bigger ones. So we put a 40 by 60 n [inaudible] and then a 40 by 40 and a 30 by 40 and a 30 by 30 and,

Matt: 17:27 and the planet and the planet is not necessarily to sell those everyday. But then now since people see them that you could sell them, but they also just say something different about how you display pictures.

Kia: 17:36 Yes. Well what’s interesting is immediately since then we put, I put them up maybe a month ago and my 30 by 30 has four smaller 12 by 12 is around it. And I was looking at our, with, uh, with our clients and someone did exactly that with their, their order, so the same exact layout. And then I looked at another client and they did, um, like rather than, because some of them are not just one single portrait of a family, it’s a grouping of big prints on the wall. We do a lot of groupings. Yeah. And so another one did a, there was a gun metal frame color. And so they did multiple big portraits in a gun metal frame color. And so I’ve realized that those immediately took effect in our orders.

Matt: 18:22 Yeah, that’s what exactly what we’ve seen too. So that’s something that we do. And then like I said, the, the repurpose idea is that then you go to a trade show or something, you take them with you and people just are blown away, you know, because your booth is, you know, 10 by 20 and then you try to put an eight by 10 and their 10 by 20 feet. And then you put an eight by 10 and nobody notices. But wait, I see a lot of photographer where their biggest thing at their trade show is their banner and that’s probably, that’s probably not the best idea. You know, your banner should be there so they know who you are, but your prints should be grabbing people to pull them in.

Kia: 18:56 Yeah. Oh, that’s a, that’s a really good idea of what’s smart to buy. Okay. So now I get to ask this question or dumb things that you buy.

Matt: 19:03 Okay. So this isn’t for us. We’ve been really disciplined, but I’ll tell you why we don’t do this. So to me it’s camera gear, not because I don’t think you should invest in camera gear because you said it well a minute ago in camera gear to make things go more smoothly. So then you reduce time and friction and that’s profitable for your business. But I think a lot of people just buy camera gear that they don’t really need. And unfortunately what happens is I think they relate that camera gear to confidence and so they’re spending thousands and thousands of dollars just to have confidence in their business. And I just don’t think it’s that smart because I don’t think in the end, you know, buying a new lens or upgrading from a one point four to one point two is going to move the needle for a lot of people.

Matt: 19:48 Now there are equipment, like if you don’t have super high equipment, it’s holding you back. You know, that’s one thing. Like for example, if you’re going, if you’re photographing weddings and then you can never focus at the reception because your camera just doesn’t have growth, good low light focusing. That’s different, that’s holding you back from the reception. But if you’re already having clients spend money and you’re shooting with, you know, in 85, one eight, do you really need to spend $2,000 to get the one for [inaudible]? Are Your clients going to even notice are, you know, isn’t going to move the needle? Are you going to get higher sales because of it? And the answer for most people’s no. And I see it on facebook all the time this time of year where people were like, okay, I just got out of my busy season, what should I.

Matt: 20:30 What camera gear should I buy? And it’s like you should probably go to a conference or you should probably, you know, order wall samples before you ever ordered that extra lens. So that’s what I think are dumb things to buy. And the reason I say we’re pretty good about that as [inaudible] allison and I met at a camera store and I used to be a camera salesperson, so I know the game that, that companies play with you in terms of upgrading to get you to upgrade all the time. And it’s very seldom are those big landmark moves that actually make your life a lot easier. Okay. So what are the things that you think are silly to buy?

Kia: 21:05 I want to know what you spend money on that, that are dumb things because I think that’s a great answer about the camera gear, but we, this is true confessions time.

Matt: 21:15 Okay. So yeah. Then this leads into the next one, like what are the things I buy that I shouldn’t buy? Yeah. Yeah. So they kind of go together. So. So I left it blank until I went home and talked to allison last night. And so she was like, she knew exactly what the two things work because you know, it’s one of the things like sometimes you’re not self aware of yourself. So the two things that she told me, she said, Matt, you’re terrible at buying too much software. Like I buy a piece of software that does one little thing that it’s cool and it’s fancy, but it doesn’t necessarily move the needle and in our business. And then the other thing that she said that we’re both really bad about is when we do like bulk printing and you’re in that situation where you’re like, okay, I can do, I can print 25 for a dollar a piece and I can print 50 and they go down to ninety eight cents and then I can buy 500 and they go down to seventy four cents, you know? And it just scales up and then all of a sudden you order like 4,000 of something that you really only needed 25 of to begin with. And then they just sit there forever. So you know, eight years ago we printed a baby plan flyer and we ordered like over a thousand of them and that baby plan flyer is still sitting there. I mean we send them out but we didn’t ever use all of them. So.

Kia: 22:26 So you over order on like uh, the, I don’t know what it’s called when they’ve been making they make it cheaper.

Matt: 22:34 Yeah. And so I call it like bulk printing and you only need 25 but you order 100 because it’s a little bit cheaper. And so that’s where, that’s where we spend, that’s where they always get us.

Kia: 22:43 So you have a problem going into costco then? Huh?

Matt: 22:46 Yeah, I don’t, I don’t go to Costco. I just need me. They’re scared of that store. I’m like, I’m like, who doesn’t need a life size? Wine glass, you know, like in a six foot teddy bear to go with it. Who doesn’t need this? Put it in the cart.

Kia: 23:00 That’s a good thing. I would if I took my children to be in so much trouble there.

Matt: 23:05 Okay. So what are the, what are the things that you think are, um, I, I don’t necessarily like the word dumbed a Bible, let’s just call it that or things that you have bought that you just like, I wish I wouldn’t have.

Kia: 23:17 Okay. Well I think so. I think you’re, the first answer was like, what do you see people doing that you think is kind of an unwise use of their money? And uh, I would say that what I see that concerns me is when people jump on the bandwagon of someone else and they see someone else being super, you know, doing really well at some things. So, you know, just like sue bryce with her Brood Boudway, you know, and they jump in and they’re like, I’m going to do that. I’m going to be that person. Or they see a, you know, these newborn photographers and they’re like, I’m going to be the best newborn photographer. So they buy all the things to be like that person, you know, they buy all the equipment, all the backgrounds or whatever education they’re selling. And they jump in to try to be someone that they’re not.

Kia: 24:07 And uh, I’m not, I’m not pointing fingers at anyone specifically. It’s happened for years. There was one guy who was super into like making people like when you could very first like be able to paint in photoshop pro painter and they, they would like take a tool around people and then like paint to look like they were kind of like floating on the background. Everyone was so into it. They were like this is the thing. And everyone started trying to do that and that was their thing. And so I think when you invest money and trying to be someone that you’re not, that is, that always concerns me because I feel like people have like piles of, you know, backgrounds and sets and educate, educational materials, lenses, whatever, that aren’t really who they are.

Matt: 24:54 Yeah. And I, I see the same thing over the equipment. Like you’ll see some photographer become really famous and they may shoot like a pro photo b one or something, you know, $2,000. Strobe and they’re amazing. They really are. But they’re already shooting maybe like an alien bee and it’s like, okay, going from an alien bee to that $2,000, is it really gonna move the needle on your business just because another photographer said that’s what they use.

Kia: 25:19 Yeah. If you know for sure that it will. If you’re like, this is the thing I’ve been looking for and I’ve researched it, then I think it’s great to purchase that. I think it’s just what I see is people who just don’t really know who they are and so they’re chasing someone else’s, you know, trying to be like someone else’s. What someone else is successful at.

Matt: 25:39 Yeah, I see that all the time as well. Okay. So now you have to do your true confession. Like what is it that you.

Kia: 25:45 Oh my true confession is a props and backgrounds. So any like anytime I’m in a store, at a vintage store, I just, the garage sale, I will screech to a halt, jump out of the car and buy whatever the thing is. So I ended up with a lot of stuff and then you can ask Andy, our garage is full, like Cha, we can’t put our cars in and it snowed. The today is like the fourth time it snowed, it never snows as much in Kansas and I know that he’s just grinding his teeth at me every time he can park his car in the snow off his windshield. But I’m like, we can’t move the stain glass piece and this, uh, you know, box and all these things. So. So yeah, it’s definitely props and backgrounds and chairs and you know, the feathers for something. I’m always, it’s, it translates into sales and sessions. But at the same time I also just end up with a bunch of junk and so rather than really carefully, I’m, I’m working really hard at carefully thinking out whether or not I buy things.

Matt: 26:56 And I’ve seen this happen for a sand because we’ve been at sync together before where we’ve gone to lunch together. You’ve seen me do this well. And so it’s like lunch, you know, these are in quotation marks and so we go to lunch and we have lunch and then you’re like, oh, there’s a store right there, I got to go to that store. And then three years later we’re still, like, now we’re like three blocks away from the car. And the lunch was like two hours ago and we’re like, we should probably go back to the hotel now because

Kia: 27:20 I’m a shopper. I’m a quick decision maker.

Matt: 27:23 Yeah. And I haven’t, I haven’t seen you really buy anything, you know, but you’re like, here’s an opportunity to find something really cool and unique and you’re like all about it.

Kia: 27:31 Yeah. I like to look and think and figure out how I’m going to do it. And it just makes me so mad if I go back to the store and it’s gone, I’m so offended. I’m like, someone took my stuff.

Matt: 27:43 Um, okay. So the next question, talk a little bit about like book, like how you, how you do your bookkeeping, any insight or how you think about bookkeeping? Because we got a lot of questions from the audience about that.

Kia: 27:55 So. Well, I use studiocloud right now. Uh, I am interested in. Oh, there’s another one out. I’ve been looking at it online. It’s like honeybee or. Oh yeah, honeybook or something like that. Yeah, I’m looking at that. I think that’s interesting. And so I use studio cloud for invoicing and scheduling and that type of thing, but I don’t use it for like actually doing my books and so I transfer everything to quickbooks and I do all of that myself and then I do all my own payroll. So, um, before I started doing my own business, that was one of my roles and our family business was doing all the bookkeeping and I, I like it. I’m a math person and so I like that, you know, the numbers and thinking about it and I like, um, like putting money into savings and I like seeing that grow and so that. So that’s how I do. I do all of it myself. How about you?

Matt: 28:50 So we don’t do it ourselves. So we have, in the past we used to have success where years ago, before it no longer worked on modern.

Kia: 29:00 Yes, we have used successfully to. Yeah, back then.

Matt: 29:03 Yeah. And it was and it was great and so it really helped us grow our business because we could see numbers and stuff, but when we very frustrated the very first year, allison and you try to do quick books herself with, with our accountant and she would just cry, literally cry. She hated it so much. Um, so we, we went away from it and we went to the success were so then when success were finally ran its course, we had to go back to something and she was like, well, I guess I could do it. I can figure out quickbooks. I’m like, no, no, no, no, no. We’ve been here, we’ve done this. So we hired a bookkeeper and our bookkeeper just puts everything into quickbooks for us and then gives it to our CPA and it’s like $120 a month. So it’s not crazy, you know, and the amount of time and energy it saves.

Matt: 29:45 Allison is worth every penny, so, so we just have a. We have a bookkeeper now that does quickbooks for us, but here’s what happened. I’ll just give people some insight. When you hire a bookkeeper is you lose the vision into your numbers because you’re not doing them, so you have to be super careful and that’s one of the reasons why we started doing profit first and we’ll talk about that, but you have to know not necessarily every nuance of your numbers that your bookkeeper’s doing for you, but you have to know like key performance indicators and so some of the kpis that we follow in our business to make sure that we know what’s going on in our bookkeeping and what what’s going on our businesses. Like we track how many leads we have. You know, how many consults we did, how many sessions we did, you know, like what our average sale is and then how many referrals are things that we keep track of because we know that those moved the needles. It’s not necessarily how much money got spent in this little bucket that the bookkeeper put together, but it’s more like, you know, what, you know, what, what do we met, what does matter to us, what can we track, but be careful if you ha, if you outsource your bookkeeping because you will lose visibility into your numbers big time.

Kia: 30:48 Well, I think that, that you definitely can lose visibility into your numbers, but if you don’t do your own bookkeeping and you just slap dash it, which I think a lot of people do a, then you’re better off using a bookkeeper then not doing anything. That’s true. And actually I’ll talk to people and I’m like, so tell me your numbers. Tell me how many sessions you’ve done. Tell me what your averages. And a lot of times people just don’t know. And um, I, I read a book. Uh, I bet you’ve read this one too. Good to great that years ago. And one of the things he talks about is just knowing, like forcing yourself to know the dirty secrets or you know, the, I can’t remember what his wording is, but essentially like deal with the facts, deal with the, you know, the scary facts and I think sometimes you just don’t want to know your numbers, you don’t want to balance your checkbook because then you’re going to have to deal with your decision making.

Kia: 31:39 And so for me, I do it, you know, I do it several times a month and then I also use digit, which is a way to save money. It takes out like a different percentage every day and puts it in a savings account and I don’t save a whole lot into that. But what it does is it sends me my balance of my account, my main checking account for the business every single day. And so it just, that’s just one little thing that keeps a tab on it for me so that I might ooze a bunch of, came out or a bunch of came in and I can pay attention to it. So I’m not. So I see that number every day, even though I don’t necessarily do sit down and do bookkeeping everyday.

Matt: 32:16 Right. And the other thing that made me think about when you’re talking about this, that relates to what you said it earlier about somebody like chasing other people in, you know, buying stuff because they want to be like somebody else. The other thing is I see like the only a key performance indicator that people really care about his average sale. They don’t track leads or consults or sessions or referrals and they only care about what their average sale is and then that to be the number that people tout to them to towel around the two other photographers, you know, um, you know, that my, my, uh, average sales a billion dollars and it’s just that I don’t, I just don’t think that’s, I just don’t think that’s a good way to do it because you don’t, that doesn’t tell the whole story. Um, so just be careful.

Matt: 32:58 And here’s the other thing I see all the time. I’ve seen this with a number of people I’ve gotten to know and it’s thoroughly disappointed as they may say like, oh my average is $3,000 and then you actually find out they’re not tracking like the Zeros are, they’re not tracking the duds of, we’re like the $500 sales, they just remove all the stuff they don’t want to admit happened and then it’s like, then my average is $3,000. Then you find out it’s not even that. It’s like, you know, $2,000. So just, I think people just need to be really careful about that, you know, that’s a side note from bookkeeping, but just gotta be careful with that. Yeah. Okay. So, so you’ve been doing profit first for a couple weeks, I guess a couple months since I mentioned to it at the very beginning of the podcast. So tell me what’s going on with it.

Kia: 33:41 Well, you know, it’s been a really good time to start profit first because this is the time of year when our business makes profit. So it has been fun to watch the profit accounts grow. And, um, I, I think the thing for me is I’m just like, I, I really am going to have to see it play out over a year of time. But I think what is gonna happen for me with profit versus I’ve, I’ve allocated money into accounts for taxes and for the slow season, you know, paying wages and that type of thing. But I haven’t done it really based on the actual amount that it, like with I’ve just done it because I’m like, okay, this probably will cover that. And so I’m done more guesstimation at first, you know, you figure your actual percentages of what you bring in and, and that, um, you know, if you do a similar amount of business to the year before, then your percentages should have you saving the money and putting it into the accounts that are gonna need it for. So I think long term it’s gonna make me feel so much more confident and I’m starting to feel confident. But then I’m kind of nervous because I’m not doing it the same way I’ve done it before. And so I’m like, okay, is this really, does this look like what I’ve done in the past so that I make sure that I had the money I need when I need it?

Matt: 35:00 Yeah, that, that makes, that makes a lot of sense. So just to clarify with people, so profit versus a book that will link in the show notes, but it’s basically a book to help you figure out how to budget your money and your business and it’s something that Alice and I have done for like a year and has now done for a couple months. Um, but it has the whole system, how to start from where you are and then build a very profitable business. And so we’re both on that journey. And so we just got to a point where we were like a couple months ago, we’re feeling super confident and it was awesome and everything was good. And then like our busy season came and I realized our percentages were off a little bit. Not in a bad way, but um, now we just have a lot of money allocated towards pain ourselves, which will be good when the slow season comes, but it definitely was like, oh, this feels different because now we don’t have as much money in our operating expense account. And so it’s like we, we actually see what happens in the busy time, in the slow time, but it’s one of those things that sometimes uterus rather not know. So it’s a journey for us too because we’re just, we’re just now finishing our first year of it. And it’s definitely been ups and downs overall. It’s been a hugely positive thing for our business, but it’s, it’s, uh, it’s been interesting, you know, just,

Kia: 36:08 it’s just an interesting right now you don’t have this big surplus in your, uh, in your operating account that you would

Matt: 36:15 normally, our tax account is full and ready to pay our taxes, which has never happened. That used to. That used to be in our operating expense account. We have all of our wages set aside for the slow season that used to be in our operating expense account. So at this point we used to have tens and tens of tens of thousands of dollars in our operating expense and now we don’t because it’s allocated to the right spots, but it makes you realize like, oh, I really didn’t have as much money as I thought and we always knew that because come like march, you realize you didn’t have as much money, but we’re just seeing, we’re seeing it ahead of time and it, that’s a different feeling than seen it in hindsight.

Kia: 36:49 Yeah, that makes sense. That makes sense. Well, uh, we would probably benefit doing a whole show on profit first and Dave Ramsey in the future. But yeah, this is, this has been fun to hear how you think about a higher spending money and I’m just doing a whole money talk. This has been really interesting.

Matt: 37:07 Yeah, this has been fun. So guys, we’ll try not to bore you too much with just having Kai and I talked as we don’t necessarily want it to be the mountain Kaia show, but um, so we’ll bring lots of interviews and we got a lot of people lined up over the next couple months to do stuff with us. But, um, we’ll try to do these every once in a while just to sprinkle in some insight into what in what we’re doing. So thanks everybody for joining us and we will see you guys next week.

Speaker 1: 37:31 Thank you for listening to from nothing to profit a photographer’s podcast with Matt and Kaya. Be sure to subscribe for more business strategy and ideas to help you create the profitable and successful business you’ve always wanted. See you on the next episode of from nothing to profit.

 

 

 

About the author, Matt

Photographer Durango Colorado

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