I’ve had my fair share of financial highs and lows when it comes to my business. Photography is something I love doing and would do for free if I wasn’t hoping to someday do only that and work for myself. Just because you love doing something as a hobby, doesn’t mean you can’t organize yourself to hopefully make a profit off of doing that thing. Today, I’m sharing how I do just that – organize my business budget and accounting to (hopefully) make a profit.
Now, if I were to try talking about everything that I do with all the little pieces, it would turn into a series (which I would be okay with, so let me know if you want that in the comments below). There are literally whole university classes that teach only this subject – for multiple years in a row! I’m no expert or professor, but I like to think that I’m a pretty good self-starter and DIYer who has a few methods that anyone could use to get started.
You can’t have a budget without knowing what your goals are. I have a Google Sheet devoted to my year-to-date (YTD) budget goals (just some ballpark numbers based on the cost of new equipment I want to buy or photography expos/conferences I want to go to, and so on).
Right now, expenses are few and far between in my business. I’m purposefully trying not to spend too much on the little things so that I can save more toward the big things. But I still track what few expenses I do have in another Google Sheet so that I can keep a close eye on those numbers – like a hawk, trying to make sure there’s still enough food rationed for each of her children (I know, weird analogy; I feel weird today). I use the app Expensify to log receipts quickly while I’m out and about so that later I have a good record to bring over to Google.
Income is anything that I’m paid by an investor or a client – so money invested towards my business and clients paying their service invoices. I list all of that out with descriptions in a – you guessed it – Google Sheet. Even if someone is just giving me a tip in cash after I photograph them – I log that as income.
This is where it all comes together. “Net” means different things for different businesses; some go all in and itemize literally everything and include their price reductions from last year and the cost of the sweater they bought for their great aunt Silvia as “loss.” I just treat “net” as a basic equation: NET Revenue = Income – Expenses – Taxes Paid Basically, for a small business sole proprietorship like mine (I retain all of my revenue), net revenue is my profit that I get to save or spend on things. Simple!
Those are the basics of my budgeting and accounting setup. It’s nothing fancy, but it helps me keep track of my earnings and stay on target for my goals. Do you have more questions about business budgeting? Ask them in the comments below!