One of the most asked questions from new photobooth owners is about pricing their services. On average, photobooth owners have a 75% profit margin - wow! With that said, I'm going to go over a couple steps that will teach you not only how to price your photobooth for your market, but also how to ensure you're running a profitable photobooth business!
Step One: Research
It's time to start Google-ing! Check out the competition in your area for comparable services. You don't have to necessarily charge what they do, but it'll give you a good indication of the market and your competition.
Step Two: Find What's Missing
When going through the companies in your area, I want you to take a look and see what everyone is doing. While doing this you're going to quickly be able to find what services they don't offer that you can. If everyone is doing the same cookie cutter photobooths, you have an amazing opportunity to do more than that. You could offer something that's very stylized, clean, modern or the complete opposite!
Find your niche and offer what's missing from the competition and you'll stand out from the rest of the crowd in no time!
Step Three: Figure Out Your Costs
Next, you want to figure out what your costs are for your photobooth. These are things like print costs (if you offer a printer), attendant/employee cost, gas, whatever you have to spend to make this work. I suggest that you create a spreadsheet with all of your costs so that you have a good idea on what you're spending. Additionally remember that all equipment has a lifespan, so it's always important to account for wear and tear on your gear in the event that something were to happen.
The average lifespan for most equipment is anywhere from 5-7 years, so you want to keep that in mind.
For example, you could take the total equipment costs and then divide that by the total number of events that you would likely do in a year. This will give you an idea of "depreciation costs" for your equipment. This includes your printer, photobooth, the iPad running inside if you're using our newest Salsa Photobooth, etc.
Once you have your spreadsheet filled out, you'll have a good idea as to how much it'll cost to actually run an event and will allow you to price your services accordingly to ensure that you're being profitable from each event. Remember, if you're going above and beyond there's a lot of "perceived value" that you can charge for - things like branded screens for corporate events, for example.
It's also important to think about costs of doing business that don't necessarily have anything to do with your equipment. Things like taxes, insurance for your supplies, etc. are just as important and must be considered. For example, if you're making $400 from an event, but your costs for travel and supplies are $275, after you factor in insurance and taxes you may be left with very little.
Now that you have an idea of how much it'll cost to run your events and how much you'll be making, remember to go and update your packages page on your website that we went over in this previous article here.
Ready for the next step of Starting a Photobooth Business? Check out this article here where we go into detail about getting your first gig! Alternatively, download our free eBook and read about these steps on the go!