1. You love photography.
2. You hate your job.
3. You decide to make photography your career.
4. You open a studio and bring in clients.
5. You quit your job and begin building a successful photography business.
The above may sound like your plan. But do you have the 6th step in place?
6. Sell your business for a healthy profit.
Photography is an art form. Because its so personal, so much a part of who you are, very few photographers go into business dreaming of the day they will sell their business.
Yet in many ways, every business should be started with the intent that you will one day sell it. When you approach your business through that mindset, you begin to notice things you would never notice on your own. And you make changes to improve it so its more efficient and more valuable over all.
Lets look at this from another angle. Look at your business as you would your home.
When you buy a home, you go into it with the intent of living in it for a long time. Yet everything you do along the way you probably say something like “this will add to the value of my home”. So you happily improve the landscape in the summer. And add granite counter tops to your kitchen. Why not spend the money; you can enjoy it now and benefit from it in a few years when you decide to sell.
So why is your business any different?
If you make improvements along the way, you’ll increase your odds of attracting future buyers. You won’t look at your business through the eyes of “I just want to make money”, but instead you’ll say “how will this make my business more healthy, more profitable and highly attractive to others”?
While you may love your business now, where will you be 10 years from now? How about 20? Things change. And if you consistently look at your business as an investment instead of a mere way of bringing in enough income today to survive, you’ll create a much more successful business overall.
I’m Ready, Now What
Now that you’ve decided to put a exit strategy in place, even if you never truly decide to sell, its important to look at things through a buyers eyes. Assess the qualities of your company the way it stands today. What gives it value? What gives it strength? And where are its weaknesses?
Buyers are interested in businesses that offer:
- A great business story – something that makes it stand out from its competitors
- A great list – relationship with clients and referral partners that consistently bring in money again and again
- A great niche – an industry that shows healthy levels of potential profits now and well into the future
- A system in place – technology, tools and other processes that makes it easy to step in and take over with little disruption
With this list in mind, create your own to-do list that will make your business more attractable in the coming years.
Study your market. Be specific and determine exactly how you fit into the photographic industry and into your defined niche. Buyers look for potential growth and how future clients will perceive your business. If you can’t define this now, work towards it now.
Develop your growth strategy. Buyers buy future performance, not what you’ve done in the past. Making $250,000 last year is great, but if you’re on track to make $100,000 this year, your buyers won’t buy. Your marketing, goals and projects should always reflect growth and be a benchmark for what you will be doing in the coming months and years. Your competitors won’t stand still; how are you reacting to that?
Build a strong customer list. A business is only as strong as its customer list. If they value what you do, you can sell anytime. But if you’re always chasing new business with little regard for your existing clientele, you’ll lose value rapidly. Concentrate on retention. This is key to any successful business model.
Strengthen your team. Photographers love being solo-preneurs. Yet this isn’t sustainable for the long run. No, you don’t need a full staff to do all of your work. But you do need support that gets the jobs done efficiently. A great accountant and lawyer, production assistants, and other help can all work off site, and possibly on consultant basis rather than paid employees. That’s okay. It’s the system that matters most, and how they help you achieve balance and flexibility so you can do what you do best.
Taking the approach you will sell at some point in the future gives you the upper hand. It helps you maximize value and improve every piece of your business model, whether you sell of not. The key is efficiency. And who can argue with that when it makes you better at what you do?