Am I Really Making Money from Microstock Photography ? Part 2
First part of this article was easy. I simply decided that I would measure productivity of my portfolio in reference to the total number of pictures I have produced for microstock. These cover rejects, pictures not submitted and some multiple versions, so they represent my entire work for microstock including learning process and some failed projects.
To proceed further I need make some assumptions and guess estimates.
After two years of microstock photography I consider myself the part-timer. I have half time in a regular job and some other streams of income in a self employed mode. It means that I can share different expenses between my self employed activities. I am not planning to work a full time for microstock.
I do not keep records of my hours spent on microstock. That wouldn’t be fun … My estimate is that I am working about 60 hours per month, i.e., 1/3 of my time. I am doing this quite regularly shooting a 3-4 times per weeks and processing and submitting a few pictures almost every day. No special shooting campaigns or “power weeks.”
I am analyzing here 23 months from December 2007 to October 2009. To build a portfolio of 1748 pictures I needed 1380 hours. It results in about 46 minutes per picture.
After months of experimentations my stock photography is focusing now on a table top subjects and concepts in my home office/studio. I enjoy a lot of outdoor activities (paddling, hiking, biking) usually with a camera. However, sales of my “recreational” pictures are too low to justify counting these trips into expenses and labor time related to microstock. However, I take into account time needed to process these outdoor pictures for microstock submissions.
Some short trips are planned specifically for microstock shooting. It is sad that shooting a local sewage outlet is much more profitable from microstock perspective than visiting Rocky Mountain National Park or other scenic destinations in Colorado where I live.
I keep my shooting costs very low. No model fees, cheap, often eatable, props. Two years ago I bought a new camera, Canon EOS 40D, with two lenses, a diffusion tent and couple of lights (see My Favorite Camera and Lens for Microstock Photography). Last month I upgraded to Canon 5D Mark II.
So, my microstock expenses are mostly related to camera equipment and some software (Photoshop, Lightroom). It is important to note what I am not including here: computer, internet access, home office expenses (these are covered by my other income streams).
To include monthly expenses in this analysis I will use the following formula:
It covers all my microstock expenses and equipment investments discussed above. Of course, I may have to adjust it in the future. With this assumption I broke even in September 2008 after 10 months in microstock. My profit is growing up in 2009 reaching $1000 in October.
Now, I can replot my return per image as “net RPI” which includes expenses. For reference my October 2009 numbers are as follows: net RPI=$0.59, average portfolio RPI=$1.01, and entire portfolio RPI=$0.84.
RPI is always calculated somewhat arbitrary. I think that its value is not so important, but its trend is. As long as it is rising, I am doing OK.
It would be nice to know how much an hour of my time spent on microstock is worth. Hourly rate of a microstock photographer? Is it more profitable to flip hamburgers at McDonald’s or do babysitting as some suggest?
Unfortunately, there is no simple answer to those questions. There is no strong link between amount of work invested at given month and sales at that month. Our pictures are selling with a long delay in time. I was trying to analyze this problem in one of earlier post: A Reverse Look at Microstock Sales from My iStock and Shutterstock Portfolios. If I stop submitting pictures to microstock right now, my pictures will be still selling and make money.
More importantly, you shouldn’t really expect profit when developing a business, i.e., building your microstock portfolio. Taking into account my total earnings from microstock during the last 23 months and my total working time leads to $4.70/hour – not very impressive, perhaps, but it’s growing.
I believe it would be more reasonable to look at the earnings, expenses, RPI in longer time periods than a month: annually or quarterly. However, since I am spending the same amount of time on microstock every month, I can calculated my hourly rate for each month showing profit. $17/hour in October 2009 is around a double minimum wage in US. I will be satisfied if it grows up to $30/hour.
I record all my numbers in an Excel spreadsheet, so I can easily change my assumptions or include additional expenses. I don’t have a business background, so my approach and terminology may be somewhat naive here. I am trying to develop a framework to analyze my net microstock earnings to have some control in what I am doing.
I would appreciate any comments and suggestions. How to improve my approach? What I am missing? If you would like to share your experience we can consider a guest post in this blog.
Related posts:
Am I Really Making Money from Microstock Photography ? Part 1
13 Months of Microstock Photography Earnings: October | November | December | 2009 January | February | March | April | May | June | July | August | September | October
My Favorite Camera and Lens for Microstock Photography
Besides repeating myself telling that your work is impressive, I must say that microstock is way better than flipping burgers or babysitting (I guess.. never done it, actually I have never worked for real,YET!)
I think you are right when seeing microstock as a job, but I think you are too serious, looks like you aren’t having any fun..!
cheers and thanks for sharing your journey, that can now be called a very successful business!
Again, very inspiring post. I am planning on sitting down in one of the winter month to calculate all my earnings that include model fees for each of my photo sessions.
For many of us that do this on a ‘recreational’ basis – meaning for fun – it is hard to calculate a return. I take lots of phots that could be considered both personal AND for stock, and time spent learning how to improve my composition, and quality of my pictures reaps rewards for my personal work as well. Like you, though, I have a regular job and definitely find a trade off between time spent and dollars earned. I know I can earn more through microstock if I spent more time, but at some point it goes beyond being fun and if money is my goal I can just work more at my regular job. From that perspective, as long as I’m having fun, learning something and there is money coming in I consider my microstock work a success – even if the hourly rate is low… I made a decision to go exclusive a while back as I knew it would mean more time taking photos (the fun part) and less time uploading, keywording and sitting at a computer. That probably doesn’t maximize my total earnings potential, but it keeps the hours spent low – which for me means my return per hour spent is maximized.
While it is interesting and sensible to consider your ‘numbers’ like this I think trying to analyse in terms of hourly rates and comparisons to regular paid jobs isn’t really achievable unless you leave it to well into retirement (mind you I’m not sure stock photographers ever do retire). The key difference with working on stock photography is you’re building an asset for yourself which will hopefully continue to earn you income well into the future. We never really know what our hourly rate will be for any given hour we put in; it is constantly shifting as sales are reported.
While flipping burgers or baby sitting may earn as much or more here and now the time invested in adding to a stock photography portfolio will hopefully generate significantly more over the portfolios effective lifetime in passive income.
Alex
Nice article. I like that you showed different perspectives on how to calculate your hourly rate. The numbers look very different when you take your total time investment versus just the current month.
It seems to me that the key is not to try to accomplish too much with RPI. The main thing you learn from RPI is whether earning per-image are going up or whether the only reason earnings are up is because you’re adding more images to the collection. Since RPI will vary from agency to agency it seems to me not very useful to try to track RPI for your entire business.
The important things is to develop trend information for a particular agency. If revenue starts to decline, it may be because the agency is adding more images to its collection and your sales are a smaller percentage of the total. There is nothing you can do about this, but it is important to know it’s happening. When RPI start down it’s nice to have some idea as to the number of images you need to add just to stay even.
When revenue goes up it is also important to know whether it is because the number of your sales are going up, or because the average-price-per-sale is going up. This number is probably not that useful on a month to month basis, but it is worth tracking on a semi-annual or annual basis. We hope prices and the number of sales will always increase. But, there will come a point where it is no longer possible to raise prices without losing sales. If prices are flat or going up slightly, but the number of units sold (downloads) is going down that’s something about which to be concerned. Are sales going down because there is less demand for the kind of images you produce, or because there are too many new images competing with yours? How much new production will you have to generate in order to keep sales level? If you are already adding a lot of new images to the collection and the units licensed are going down it is really a problem.
I wouldn’t worry about trying to include unaccepted images in your RPI calculations.
The really important thing is not RPI , but gross revenue minus expenses divided by hours worked. Your RPI with iStock may be high because they accept so few images. But, lots of photographers earn more from Shutterstock, Dreamstime and Fotolia because they accept more images into their collections. The bottom line is gross revenue, not RPI.
It seems to me to make more sense to track profit and hourly rate of return on a semi-annual or annual basis rather than monthly.
It is interesting that you keep your expenses low, but you must have some expense besides a new camera each year. I hope you’re keeping good track of those expenses for tax purposes, if nothing else. If you’re buying food to photograph you can deduct those costs from your income for tax purposes.
I’d like to see some figures on total income minus expenses including all the cameras and software. The first year loss is acceptable given the capital investment required, but the big question will be in January when you’re able to figure the profit and average-pay-per-hour for 2009.
Your computer, internet access and home office expenses may be covered now by other income streams, but if you were really allocating properly you should assign one-third of these costs to your microstock photography business. This is particularly important if you have any thoughts of becoming a full-time shooter because these costs would then become part of your business expenses. It is good that you’re doing so well in your other lines of business that you can afford to devote one-third of your working time to something you enjoy.
Jim Pickerell, Editor, Selling-Stock
Leave your response!
New books
categories
Contact
send me e-mailsticky pod
Recommended microstock agencies
my web sites
Related posts
Most Commented
recent comments