The main goal of a photo business, as a matter of fact all businesses, is to make a profit. It's not me who says so. In Canada, CRA1 aka the income tax police, has made the decision for me:
You can only operate a photography business, any business, for 3 years, if you are loosing money! After 3 years, the business must start to turn a profit or break-even. If the business does not at least break even, then it's not a "real business"2. CRA will reclassify your photo business as a hobby. Converting your business to a hobby means that CRA will disallow all of your expenses and reassess retroactively your taxes and penalties…
Now, let's say that if you were to double your photo fees, and lose half of your photo customers, your total income would stay the same. Inversely, if you halve your fees and double your customers, your total income would stay the same.
- The higher your rates, the higher your credibility.
- The lower your rates, the lower your credibility.
There are 2 sayings:
- If your customers are not complaining about the fees, then you're not charging enough.
- Charge them until they start complaining, and then charge them a little bit more.
1 CRA: Canada Revenue Agency ↑
2 Check either with an accountant or with your country's taxation agency for it's own rulings. ↑