How to calculate your photography cost of doing business

CODB per session = (yearly business costs + the salary you want) ÷ sessions per year. CODB per hour = the same total ÷ working hours per year.

Your cost of doing business (CODB) is what a year of running your photography business costs, including your own pay, shared across the work you can actually do. Charge less than it and the difference comes out of your own pocket. It is not your price: your price adds the direct costs of each job, payment fees and profit on top.

Step 1: list a year of business costs

Gear depreciation: what you paid for cameras, lenses, lights and computers ÷ the years you expect to use them.
Monthly costs × 12: software, website and galleries, marketing, phone, subscriptions.
Yearly costs: insurance, accounting, education, memberships, studio rent if you pay it yearly.

Use your bank statements and receipts, not guesses. Leave out costs that belong to one job, such as a second shooter or a print order: those go into the price of that job.

Step 2: add the salary you want

Decide what you want the business to pay you for a year. This is your choice, not a market figure. Taxes are not included in this method; if the salary you have in mind is a take-home amount, ask an accountant what it means before tax.

Step 3: count the work you can really do

Count working weeks after holidays, sick days and quiet periods, and the sessions you can shoot and deliver in a week. For the hourly figure, count every hour a session takes: shooting, editing, travel, emails and admin. Sessions per year = working weeks × sessions a week. Working hours per year = sessions per year × hours per session.

Worked example (fictional numbers)

A portrait photographer's year. These are example numbers, not typical or recommended figures:

Gear: $6,000 used for 3 years = $2,000 a year
Software: $20 a month = $240 a year
Insurance: $480 a year
Website and galleries: $25 a month = $300 a year
Marketing: $100 a month = $1,200 a year
Other costs: $780 a year

Business costs add up to $5,000 a year. With a $40,000 salary, the year has to bring in $45,000, or $3,750.00 a month.

The photographer plans 44 working weeks with 2 sessions a week: 88 sessions. Each session has to cover $45,000 ÷ 88 = $511.36. A session takes 6 hours in all, so the year has 88 × 6 = 528 working hours and the CODB is $45,000 ÷ 528 = $85.23 an hour.

If the same photographer booked only 66 sessions, each one would have to cover $45,000 ÷ 66 = $681.82. Fewer sessions means each one carries more of the year.

Using your CODB

Session prices: the photography pricing calculator adds direct costs, payment fees and a margin to your CODB.
Packages: multiply your CODB per hour by every hour a package takes, as in how to price wedding photography packages.
Discounts: before you agree to a lower price, compare it with your CODB per session.

Common mistakes

Counting 52 working weeks.
Counting only shooting hours, not editing and admin.
Leaving gear out because it is already paid for: it will need replacing.
Not updating the numbers when costs or bookings change.

Add up your own costs in the cost of doing business calculator.