Why Do Small Businesses Cost So Much | Orange County Family Photographer

Why Do Small Businesses Cost So Much | Orange County Family Photographer

In this business, we often get asked about our pricing. What we charge, why we charge what we charge, etc. In any business, there are costs associate with running it, as well as the cost of product that the store has to purchase so that they can, in-turn, sell it to you.

This is an education piece that we wanted to present because most people out there don’t have to run their own business and so they don’t understand if they can purchase a 5×7 for a few cents from somewhere why, when they come to us, we charge quite a bit more. Trust me, there is a logical reason and that’s exactly what we want to explain for you here. Our hope in this is that it will not only help you to understand our business, but also understand and appreciate any other small business that you may come in contact with.

I like to start with an example that most people can relate to: Starbucks. Yes, the almighty, find-them-on-every-corner coffee company itself. I’m sure you’ve had an interaction that involved an exchange of money at one point or another with them, haven’t you? If so, do you know what you’re paying for when you hand over that $5 for a drink from Starbucks? $8 is the average of what people spend on a drink at Starbucks currently, in case you were wondering.

I would venture to guess that you’ve probably never really thought about what the ingredients to make that coffee actually costs the store and how much they mark it up, have you? Most people haven’t, but lets figure it out together.

I used to work for a coffee shop as a manager and I can tell you first hand that the cost of a large fancy drink of any sort, from cup to ingredients, only costs the store approximately $.15-$.20 to make. Yet, people flock there and pay $5 on average, which is about a 2500% increase on their cost of goods. This seems like a public outrage, but no one is complaining. Why is that?

Here’s what we want everyone to understand and remember whenever you’re dealing with a business where you don’t understand their product costs. Every business has to not only purchase the product to resell, but they also need to pay for any gas that is involved in commuting on behalf of the client, pay for any sort of programs that it takes the manage the business and keep clients happy (client management systems), pay for any materials that are necessary to market the business, purchase and maintain examples of what they sell, pay for rental space for their storefront, pay for their website and the maintenance of that, pay for the purchase and maintenance of any equipment that is required to run the business, as well as pay their employees and themselves. That’s just to name a few things. All of those things add up to thousands of dollars of cost to keep the business running and take care of the employees so that they don’t have to live out of a box behind a grocery store.

So remember, the next time you visit a small business and you wonder about their prices, just remember, they are simply trying to keep things running so that they can serve great people like yourself today and for years to come.

Now, go thank a small business somewhere today! :)

 

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Orange County Family Photographer, Kincannon Photography is a professional photographer in Orange County, California capturing newborn, seniors, dog, children and family portraits.

Kincannon Photography is based in Yorba Linda, and serves all surrounding areas including Newport Beach, Irvine, Corona Del Mar, Brea, San Juan Capistrano, Aliso Viejo, Mission Viejo, Costa Mesa, Fullerton, Villa Park, Laguna Beach, Newport Coast, and other surrounding Orange County metro areas.