The main barriers to entry of photo lab business are the dependence on skilled personnel and instable lease terms. It is advised to focus on digital printing. The extra profit comes from the demand for additional services, such as printing on souvenirs (cups, t-shirts, bags), non-standard surfaces, etc. The number of orders depends on the seasonality. The biggest volumes are processedin August - October, January, and April - June. February is considered “dead season."
Currently, this industry is attractive due to the absence of serious competition. But it is worth bearing that the annual income volume of many market participants have already exceeded a million dollars. Miniphoto lab can open new opportunities for the young entrepreneurs. Service demanding amateurs and professional photographers is difficult and expensive.However, this direction is very promising. This area of the market is expanding at the impressive rate.
The main thing at the first stage is to have a contract with wholesale buyers from the very first day.
The photo lab competition is rather high on the market.Small companies occupy all niches. Usually,these companies are involved in similar activities. There are companies that provide only printing services or deal only with the documents’ photographs. There are companies that simply print photos to send them to other cities for another price level. Such companies serve as the intermediaries between photo laboratories and consumers without investing a cent into their invention. At first, the main problem for any photo lab is to gain and retain customers. The clients want all of the services in one place. Therefore, the laboratory should offer a wide range of inexpensive services such as printing, processing, souvenirs up-dating, etc. Another alternative is to establish good relations with companies that offer related services to cooperate with them later.
To retain and attract customers, you need to offer something more original than just printing and publishing photos. For instance, a so-called photocafé might be an interesting way out: the place where people have the opportunity not only to enjoy photo art and buy all the necessary goods, but also to relax with friends over a cup of coffee.
To receive some good examples of setting such buisines, take a look at Kodak Picture Kiosk and the Noritsu Mini-lab, they are quite pricey, although you can start with these different equipment. These minilabs print 4x6, 5x7, photo books, etc.Digital printers are moving away from chemicals and into high tech fast inkjet printers but older Fuji Frontiers will still process film and print it digitally to process RA-4 paper. They can also make digital RA-4 prints from digital media: smart cards, etc.
First of all, you have to think of the digital printing machine. Pay attention to Global Sources, Xerox, SDMC, Sidharth, Fuji, and Flexcon. The new machine costs about $100,000, but there is no sense to waste your money on it. Try to find an operating one with the help of classifieds. The additional software for such machine to operate is not required. The most critical licensed software is Adobe Photoshop, which will reduce $300 more from your initial budget. Total OS expenses might vary around $1000. Free software, unfortunately, doesn’t work for this type of business, because printing equipment requires graphical files prepared in a special format.The designing computer costs from $700. The PC must possess at least 2 GB of RAM and a powerful graphics card. Speaking about office furniture, let’s consider the minimum:designer computer desk, 2-3 chairs, one big closet for storage of products and consumables.If you are aboutto sellsome goods, the shop window and few shelves are needed.Prepare $550 - $600 for the furniture. Any equipment installations, up-dates or repairs will amount to $500-$700.
Let’s sum up the equipment expenses:
52” wide roller-transport color print processor - upwards of $80,000;
digital printing machine $20,000 – 30,000
designing PC - $700;
furniture & fixtures - $500 – 900;
installations and repairs – up to $700.
Since 1977, material costs, alone, have increased as much as 300% to 500% and even higher for some specialty materials.
You will need the paper boxes containing each type of paper with the width of 15.2 cm, length of 180m, and 10x15 size (an average of $130 perbox): one box of matte paper and another one of glossy. You also have to purchase the paper with the next parameters: width of 20,3cm, 15x20 and 20X30 sizes; 25,4cmwidth, hand HS formats(glossy and matte). One set of the chemicals for printing is about $130 per 10,000 prints. So, the total raw material costs are roughly $130?5=$650.
The flyers (5000) will cost less than $100. Posting ads on posts can cause problems with utilities and result into the penalty for unauthorized advertising.
Mind your expenses with the help of this checklist:
licensed software $300;
OS - $1,000;
paper sets - $130 per set;
chemicals sets - $130 per set;
promo flyers or business cards - $90 per pack;
ink cartridges in a big amount – around $25 per package;
colorful ink tanks - $35 (average);
blank CDs, DVDs, floppy discs (try to get goods with printable surfaces) – roughly $10 per set.
This parameter is believed to be the most important while setting a photo lab. There are two basic approaches tothe location of photo labs. The first option is a heavily trafficked area, convenient for customers on the way from home to work.Second, any small room with 24 hours access to Internet and phone. Photo lab is one of that business types which can take place in the downtown area, village or suburb. People living over there are not that technologically advanced, so they turn to the corresponding services more often. Poor and elderly citizens cannot handle computer-related activities on their own. So, that is a “golden mine” for any entrepreneur.
The rent of production premises with a minimum of ten square meters (while the perfect size would be 20-30 square meters)will amount to approximately $15-30 per one square meter. As for the first attempt, the premise may be rented for two months.In addition to size, the main requirement to the spaceis a good ventilation as far as the main activities will be dealing with chemicals. On the average,rent expensesreach 2x$300 per month.
Nother option. Space needed: 50 - 200 square meters would be perfect. The main sanitary requirement is the lack of moisture and dust: it may damage your expensive (and not really) equipment.
Why does the space matter even more than personnel or good advertising campaign? Well, the total monthly utilities of one photo lab increase from about $1,000 per month to over $4,000 per month for the same amount of space!
As for the advertising campaign, distributing flyers and business cards in thearea nearby and minimal search engine optimization will work it out. Later, activeInternet advertising and social network campaigns might add up.
The wages ofthe employeeswill range from $300 to $600 each. In fact, a photo lab needs about five people to work for two shifts (two workers per each). The staff you will most probably need in the beginning is an operator,manager, a courier, and a salesman. There are two options of operating a business: you may be the only head, or another supervisor can be hired. A courier may work temporary while others have to operate on a full-time basis. All of their salaries would amount to an average of $500 to $1,500 per month. Pay for one-day course and it will be enough to let your personnel work efficiently.
If you manage to get a good designer, the laboratory is developing towards services for image processing & scanning.A good operator stands for time loyal customers.Talented salesman will develop the sales level effectively.A good manager is responsible for a stable and reliable relations with wholesalers.
On the whole, you will need the following employees:
- system administrator;
Due to the increase in demand for digital technicians, local junior colleges started cranking out "certified" Photoshop technicians. With a glut of "certified" digital technicians, higher wage, experienced employees are being replaced, again, with lower wage, inexperienced employees. But this is only the tip of the iceberg. Too many of these "certified" technicians have never had experience working in a traditional photo lab.
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