In my post titled Build a Photography Business in 24 Hours, I mentioned that I would expand on each piece of the puzzle for creating your own business. I’m using my recent experience with setting up Auer PhotoWorks as the basis for this guide. Here are all the pieces of the business-puzzle I talked about (with the * items being optional):

  1. Photographs
  2. Gallery Software
  3. Hosting Company
  4. Domain Name
  5. Trade Name
  6. Bank
  7. $500
  8. * Merchant Account
  9. * Accounting
  10. * Marketing

This post will focus on steps 1 and 2 of the optional items: Merchant Accounts and Accounting Software. I’m tying them together because they both deal with finance, and I call them optional because they aren’t absolutely necessary to run the business. Even though they’re optional, these items can be very important to the overall business success.

So far, I’ve brought us up to the point of launching an online photo sales business that will allow you to accept checks and money orders for purchases. If your business is primarily online, these aren’t the preferred methods for customers to buy things. People don’t want to get out their checkbooks, write you a check, mail it to you, and wait for it to arrive and clear the bank. They want to either get out their credit/debit cards or sign into PayPal for instant purchasing capabilities. Don’t miss opportunities by not catering to most online buyers.

In order to accept electronic payments, you’ll need a merchant account. This is a relationship with a financial institution that allows you to process credit cards using their service. They keep a certain amount of the sale for themselves, and you get to offer convenience to your customers. For processing orders online, you’ll need to set up a payment gateway — which the merchant service provider will give you the requirements for. Setting this up on your own can be difficult and time consuming to say the least. Luckily, most of the photo gallery software have some type of merchant capabilities built into them. You’ll still need a merchant account, but the programming will be taken care of. The software I purchased allows me to process through PayPal, 2CheckOut, or Plug n’ Pay.

This brings me to a good point about PayPal. They actually have two levels of merchant accounts in addition to their traditional PayPal account. One merchant account is free of upfront costs and monthly fees, while the other has a monthly fee. What’s the difference? The free one will take a customer from your site to PayPal’s site to complete the order. The one that costs money will allow you to process cards straight from your site just like any other merchant account. The upside to the free one is that you don’t have to worry about the programming, SSL, certificates, etc. The downside is that customers are taken from your site, which may deter some buyers. It’s probably not a big deal though, based on the fact that almost everybody has at least heard of PayPal — plus your company logo will appear at the top of the PayPal site while customers are checking out. This is the route that I’m going with right now on my site. If somebody decides to checkout using PayPal or a credit card, they’re taken to the PayPal interface where they can choose which method they’d like to use.

Now on to other financial matters — accounting software. Once you start spending money and making money, you’ll want to keep track of it all so you can evaluate your business and do your taxes at the end of the year. This probably isn’t as important if you’re not selling much of anything, but it’s a good habit to get into. For us beginners with very little business transactions, I found a free piece of software from Quick Books. The free version of their accounting software is called “Simple Start Free Edition”. It has some limitations, but it will make do for a while. When you need to jump up to the next level, you’ll only need to fork out $100. If you don’t use Quick Books, at least use something — it could be a spreadsheet for all practical matters.

So the only thing left to cover in my list of things-to-do is marketing. For that, I’ll have a good list of resources that will help you start down the road of becoming an Internet marketer.

Photo of the Day…

The Capitol

Photo by Brian Auer
11/15/05 Washington DC
The Capitol
Konica Minolta DiMAGE Z3
50mm equiv * f/7.1 * 1/320s * ISO50

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I was just wondering about pricing. How do you establish your rates?

July 14, 2008 3:53 pm

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