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FORUMS Post Processing, Marketing & Presenting Photos The Business of Photography 
Thread started 26 Feb 2013 (Tuesday) 19:33
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Cheap Competitors - How do they do it?

 
pstyle1
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Apr 01, 2013 20:05 |  #121

mobei wrote in post #15780550 (external link)
[I]It has everything to do with me. I'm losing money because they are breaking the law.[/I]

1. How do you know they aren't reporting their taxes at the end of the year? What's your criteria for reporting someone? Or do you just report whoever you see might be of comeptition to you?
2. How does whether they report their taxes or not affect your business? The client hiring the photograher probably doesn't take the photogrpahers tax reporting habits into consideration.
3. Have your ever bought anything from Amazon? Did you report the use tax? Didn't think so.


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Luckless
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Apr 01, 2013 21:19 |  #122

I for one would like to know how someone who isn't properly paying their taxes would actually cost you money.

Customers can go with any photographer in Set (A). We'll call you (A1), and the rest (A2), (A3), ... (An). All customers belong to Set (B). Your income is based on members of (B), (B1), (B2), ... (Bn), who choose you over other members of Set (A).

...

...

It would be a lot easier to draw this out on a white board, but long story short is that whether or not any member of Set (A) is paying their taxes or not really doesn't matter, unless of course the customers in question are more worried about paying peanuts or less, in which case you aren't actually in a market.

In that case you're in a fantasy land where you think you have some kind of right that says you MUST make a profit, are entitled to profits, and that everyone must bow down and kiss your backside because you're just special. That isn't a real market, it is scraps that fools chase.


If someone undercuts you on price with the savings equal to the value of what should have been their taxes, then there is nothing that says those customers would actually have come to you anyway. There is no law that says I MUST hire a photographer. If I don't like the price of one, I can skip hiring that service and spend my money on something else I feel is more profitable for me.

I've never hired a photographer. Am I stealing what should rightfully be their money by not paying them for stuff I never hired them to do for me in the first place?

(I have spent a lot of time around successful business men and women. I have taken many classes on business, written dozens of business plans and proposals, and read a lot on the subject matter. Not once have I come across a single instance where someone said "And I own all my wealth and success to getting my competition charged with tax evasion or fraud".)


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mobei
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Apr 01, 2013 21:45 |  #123

erdons wrote in post #15780720 (external link)
I work for the state sales tax revenue agency in California, look it up if you don't know who it is. I have to tell you that the state does not have the manpower or the means to go after little Jimmy who decided to turn his hobby into a business and makes a few thousand dollars a year, there are much bigger fish to fry than someone who evaded the state for a couple of hundred dollars in sales tax. I'm sure many people have failed to pay use tax for their untaxed purchases from Adorama and Amazon, it happens all the time but in the end it's not feasible for the state to pay a hefty salary for someone to track all this. Do I condone someone starting a business without the proper permits and evading sales tax? No I don't, but instead of blaming these people for ruining your business, make your business so great that they have no choice but to hire you for your services.

Thanks for your post.
You are right about them not prosecuting everyone. Most of the time they will notify them and they will comply with the law or quit. This is all I am trying to accomplish. We play on a level playing field or get out. I'm not trying to persecute anyone. I continue to post because we should being educating people to do business the proper way not by illegal means.
Would you care to share how much tax would be lost if most small businesses failed to collect sales tax?




  
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mobei
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Apr 01, 2013 21:46 |  #124

[QUOTE=Luckless;157809​43]I for one would like to know how someone who isn't properly paying their taxes would actually cost you money.

If you were a full time general portrait photog you would know.




  
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pstyle1
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Apr 01, 2013 22:05 |  #125

[QUOTE=mobei;15781021]

Luckless wrote in post #15780943 (external link)
I for one would like to know how someone who isn't properly paying their taxes would actually cost you money.

If you were a full time general portrait photog you would know.

Can you be more specific?


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mobei
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Apr 01, 2013 22:36 |  #126

[QUOTE=pstyle1;1578107​2]

mobei wrote in post #15781021 (external link)
Can you be more specific?

Sure.
They can operate with a lower cost of doing business. They have less financial liability.
Same principal as Amazons success. People buy there so they don't have to pay sales tax.




  
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erdons
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Apr 01, 2013 22:58 |  #127

mobei wrote in post #15781016 (external link)
Thanks for your post.
You are right about them not prosecuting everyone. Most of the time they will notify them and they will comply with the law or quit. This is all I am trying to accomplish. We play on a level playing field or get out. I'm not trying to persecute anyone. I continue to post because we should being educating people to do business the proper way not by illegal means.
Would you care to share how much tax would be lost if most small businesses failed to collect sales tax?

To be honest that's not even the case, like I said the state does not have the manpower to try to investigate all the hobbyists making money and evading sales tax, you have to realize an Investigation into every one of these hobbyists takes to long. We would have to first of all have proof that they are indeed liable for sales tax, have to have proof that something tangible is being given to the client, if they say its all digital transfers then no sales tax is due. We have to be able to get a hold of even customer have them fill out affidavits describing what was sold and how it was given to the customer. There must be 100's of hobbyist per every state employee that handles investigations. I know you may believe this is affecting your business but the fact is your efforts to make a difference will more than likely go unheard. Focus on making your business the best and you will beat out the hobbyists every time. To put things into perspective I do corporate sales tax investigations, If the potential liability is below 35k in sales tax due I won't waste my time when l can use my efforts to go after the corp that owes us 100k.


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DocFrankenstein
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Apr 01, 2013 23:05 |  #128

[QUOTE=mobei;15781146]

pstyle1 wrote in post #15781072 (external link)
Sure.
They can operate with a lower cost of doing business. They have less financial liability.
Same principal as Amazons success. People buy there so they don't have to pay sales tax.

People buy from amazon because they have an efficient warehouse system of a huge size with robots instead of humans filling orders. Taxes would not make up the difference.


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memoriesoftomorrow
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Apr 01, 2013 23:06 |  #129

mobei wrote in post #15780321 (external link)
I'm the guy with the studio, feeds my family with my photography and does it while fulfilling all my legal obligations and I need more skills?:rolleyes:

Well it certainly comes across like you're the one who needs to look at yourself for your problems rather than others. Running a studio will only get tougher especially if you are already struggling. Photography is worth less to consumers these days... why? Because they have almost an unlimited free supply at their finger tips. Supply goes up from free channels, demand goes down from paid ones.

Delivering a stand out product and service that consumers feel they absolutely must have will though. If you aren't doing that then the bottom line is your product/service isn't worth to consumers the value you have placed on it... that is a "you" problem not a "them" problem.


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cdifoto
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Apr 01, 2013 23:22 |  #130

DocFrankenstein wrote in post #15781238 (external link)
People buy from amazon because they have an efficient warehouse system of a huge size with robots instead of humans filling orders. Taxes would not make up the difference.

Robots do not fill orders at Amazon. You're thinking of Newegg.


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cdifoto
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Apr 01, 2013 23:27 |  #131

mobei wrote in post #15781146 (external link)
Sure.
They can operate with a lower cost of doing business. They have less financial liability.
Same principal as Amazons success. People buy there so they don't have to pay sales tax.

Amazon has been able to win because they sell mass produced commodities at some of the lowest prices and offer free shipping in some/most cases.

Stop offering photographs and minimal service that makes people think of you as a mass produced commodity and you won't have to compete on price. If you do have to compete on price because, quite frankly, we can't all be arteests, streamline your operations so it's profitable. Cut out the inefficiencies (one of which is spending so much time reporting others to the tax goons) and you'll be surprised what you can do.


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DocFrankenstein
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Apr 01, 2013 23:29 |  #132

cdifoto wrote in post #15781276 (external link)
Robots do not fill orders at Amazon. You're thinking of Newegg.

http://www.youtube.com​/watch?v=kRg_1j-iWFU (external link)

As long as you trust youtube as an information source... but technically even their previous conveyor system was a robot in the strict definition of the word.


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cdifoto
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Apr 01, 2013 23:58 |  #133

DocFrankenstein wrote in post #15781292 (external link)
http://www.youtube.com​/watch?v=kRg_1j-iWFU (external link)

As long as you trust youtube as an information source... but technically even their previous conveyor system was a robot in the strict definition of the word.

They might have a few installed in select warehouses but for the most part, it's still human. Conveyors don't count, as a simple motorized conveyor is not order fulfillment anymore then using a forklift is order fulfillment. Heck even those robots aren't order fulfillment, but instead a small yet crucial part of the overall system. If you watch the video, humans are still filling the racks that the robots move around.


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DocFrankenstein
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Apr 02, 2013 00:07 |  #134

I think we're out of scope of discussion. BTT?


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cdifoto
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Apr 02, 2013 02:39 |  #135

DocFrankenstein wrote in post #15781369 (external link)
I think we're out of scope of discussion. BTT?

Yes perhaps robots are a bit off topic for a small business, but reducing inefficiencies should never be.


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