Wednesday, August 15, 2007
Cash Flow 101
Inside every successful photographer there's a successful businessperson. One of the most important aspects of making a living in this field is managing your resources to keep your cash coming in.
If you've read this far, you're smart enough to grasp the concepts outlined here. Indeed, I have full confidence that you can immediately take them to the next level. The days of assuming that creative types aren't financially savvy are dead and gone. Your work, brilliant as it is, is a negotiable commodity subject to the same business ideals as a major corporation. Once you open your mind to incorporating some solid business planning into your bohemian existence, and you start to see even the smallest financial results, you'll become addicted to the empowerment. All you need to do is think a little bit more with the left side of your brain.
Software To Manage Your Cash Flow
For a seemingly bohemian profession, we photographers have to do a lot of money managing. Thankfully, we live in an age when software will do all the work for us.
Our core existence comes from generating estimates and invoices and managing shoot budgets. Blinkbid (www.blinkbid.com), fotoQuote (www.fotoquote.com) and PI/E Software (www.piesoftware.com) are three software applications that are designed specifically for photographers. Each of these applications has a demo version available so you can try it out and decide for yourself which one best fits your needs.
Accurately managing your overall financial picture is absolutely crucial to running a successful business. There are no shortcuts. For end-of-the-year tax filing, I highly recommend hiring a tax accountant. Seek out one who specializes in creative types like us so you can maximize your deductions. But keep in mind that a tax accountant is only as good as the information he or she is given. To manage the day-to-day record-keeping of your money, I strongly recommend two products.
MYOB (www.myob-us.com) is accounting software for small businesses. A global company, MYOB, or Mind Your Own Business, is a cross-platform application that's better known on the Mac in the United States. MYOB has an incredibly easy-to-use interface and extensive reporting. It's highly regarded and well rounded. A marvelous plus to MYOB is that it offers a free limited version that your accountant can download and use to access your data file if he or she isn't using MYOB.
Last March, MYOB CEO Craig Winkler announced a development team dedicated to the Mac operating system. As the Mac operating system evolves with new innovations, MYOB will be positioned to quickly integrate them into its products. As a Mac user, this was brilliant news.
The other accounting software available is QuickBooks from Intuit (www.quickbooks.com). Intuit also makes Quicken, personal accounting software, but I recommend QuickBooks if you go with Intuit. It's designed for small businesses, and that's what you are. Like MYOB, QuickBooks also has a remarkably robust feature set and is highly regarded in the accounting world. Its files are cross-platform as well.
Both companies have Websites with an amazing amount of resources. Additionally, both have been around a long time with enormous user bases, so committing to one or the other is a safe move.
I'll confess: In the first 10 years of my career, I was delightfully ignorant of my overall financial picture. That was until I got a call from my bank politely inquiring how I was going to cover an $800 overdraft. That phone call caused me to change my pants and my attitude. Maintaining my financial records requires about 45 minutes a week. It's easy to download bank and credit card statements straight into the products I mentioned above. Also, Blinkbid is currently developing a feature that will allow you to import your photography invoices into MYOB and QuickBooks.
Pursuing sound money practices may not be as glamorous as shooting, but making a good living as a photographer is—give yourself every advantage you can.
Louis Lesko is a fashion photographer based in Los Angeles. He started his career at the age of 19 in San Francisco and celebrated his 21-year mark last October. All this, and he doesn't look a day over 39. Lesko is also the owner of Blinkbid Software, estimating and invoicing software for photographers.
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