Business Question: Dividing profit/expenses?

[KevC]

Hey,

A friend of mine is also a photographer and she wants to "join forces" and get serious about doing this professionally.

We're both honest and trustworthy people, but money scares everyone which is why I'm asking here.

Equipment costs? Materials cost? How is it divided? Profits?

There's also another issue. She shoots film. And she shoots Minolta. She could stick to film and I'll stick to digital, she suggests keeping equipment seperate completely seperate.

But how about materials cost? She'll spend more money buying/developing/printing film. How about profits? Chances are, I'll shoot more because I shoot digital..

I was thinking this: Make a company. Keep the company seperate from ourselves. Expenses will be the company's, and we just write ourselves a salary.

The equipment costs still bother me.

I'm considering convincing her to switch to digital, and Canon for that matter so she can use my lenses. And she doesn't have to spend so much with film. But that's a grand right there spent.

How about if this doesn't work out? Who gets to keep what? She'll hafta pay for her own equipment then? Isn't asking her to spend a grand right away a lot? Sure is...

It's all very complicated, and I don't want to ruin friendships over this. I'm not money hungry and neither is she. But I want to be fair.

Maybe it's not such a good idea, but having a second shooter is always good. Less missed shots, twice as much "networking", hopefully more clients. Sure, the profits may be lower BUT we'd probably get more deals and get our names out faster...

Thoughts?

[RockSlut]

See a lawyer and get them to run you through the business model options. There is much to be taken into consideration and that there will be legal implications for the choices that you make.

[ejhunt]

Whatever you decide to do, put it all into a contract. Nothing destroys a friendship faster than arguments over money.

[Pyromaniac]

KevC,

I shoot with a friend of mine in the same manner that you’re talking about doing. It's not a full time job for us though. It works out rather nicely since we both have full time jobs besides photography, when I'm at work he's off and when he's at work I'm off so one of us is almost always available, and sometimes we both do a shoot together if we're both off work at the time. I shoot with Canon, and he shoots with N***n (both digital). We both already had our own gear before we started shooting together. We each buy our own equipment and accessories, this way if we decide to stop working together nothing belongs to the company and we simply take it with us.
As for expenses, we collect cash or check at the time of the shoot, then use that money to cover the cost of prints, cd's, and any other material we use. If one of use bought an item before hand then we reimburse our self. What’s left after the expenses have been taken out we then divide in half and that’s our salary. Needless to say the "company" is always broke. We don't have a studio since most of what we shoot is youth sports teams doing the team photos and game pictures. We use his address as the mailing/contact address and our cell phone numbers on our business cards (my # on my cards, his # on his cards).

Also being a .Inc or LLC (or Canadian equivilent) is very important so that you personly can not be sued only the company can. Our houses, cars, and equipment are personal property and can't be siezed as part of a lawsuite or bankruptcy settlement. So in our case since the comapny is alway broke but not in debt and owns very little if we ever are sued there's not much anyone can get.

[brivett]

It doesn't sound like your planning a full time business that will replace you day jobs. (Not meaning to be bitchy but it's unlikly with a Minolta users shooting film).

Why not join forces with regards to marketing, web promotion etc, but you take the cash from your shots using your letterhead and bank account, and she takes hers.

That way you cover your additional hardware expense shooting this century and she covers (or not) her additional film and process costs from shooting film.

If you are going to join forces - You should be equal at start - i.e. in investment in equipment - Yours lots - hers neglidgable.... plus also in skills brought to the table. Are you equal in skill and thus sucess rate ? can you each hold your own at photoshop ? Otherwise the spoils should be apportioned as a ratio.

My honest thoughts... two already full time pro's could join forces to start e.g. an event coverage business. Two would be pros joining forces are only doubling the hurdles that are part of starting out in this difficult business. A very good way to spoil a friendship. Certainly try it loosly for a few months.... a bit like premarital relations... make sure you can settle these sort of issues correctly in advance before you (maybe litteraly) sign your house over....

p.s. Both get insurance !