This is a guest post by Andrew “Fundy” Funderburg, the creator of the Fundy Album Builder and Fundy Album Proofer. Please check out the free trials available at http://www.fundysos.com. If you were looking to design albums yourselves, I highly recommend Fundy's products.

I've seen many forum posts on pricing prints for photographers and they usually all end badly. There are those that defend the high price points due to labor, business costs and what the market will bear. And those defending the low end price points, focus on auto-fulfillment, and what the market is willing to pay.

So who's right? Well the answer is simple, both price points are correct?

How can this be? Well, ‘correct' pricing is based only on two things.

1. What the market is willing to pay for something.
2. That a price is profitable according to retail pricing rules.

Let's take a closer look. It's pretty easy to find out if people are willing to pay a certain price for something. You simply throw it out there in the marketplace and if people pay money for it, then it is a viable price. You can move the price point up and down. When it goes down, more people buy it, when it goes up fewer people buy it. Pretty soon, you find the happy price point, quite a few buyers at a profitable price point.

What is profitable? Well, according to the Professional Photographers Association of America, you'll want to have at least a 35% cost of goods mark up to be profitable – that is, pay your bills, run a profit and grow your business. A 35% cost of goods, simply means that for every $1.00 you make, it costs you 0.35¢. If you sell ice cream on the street corner, and you buy it for 0.35¢ and sell it for $1.00, then you have a 35% cost of goods.

To get retail pricing of goods, simply take your costs and divide by the percentage (35%=0.35). So, if something costs you $10 to create for your client:

$10 ÷ 0.35 = $28.50

We'll use this simple formula to prove both arguments are correct. We did this recently in a speaking engagement we had at ProDPI headquarters. We were using our new pricing program, Prosper™ during the demonstration.

Here in our settings, we have our cost of goods set at 25%, a good COG for an established photographer. We've also estimated our hourly rate in our studio for the work we do.

Now, let's look at two scenarios. The first being a photographer who is selling art prints for a portrait sitting or of the bride and groom in a posed shot. This is a special order, the photographer is going to retouch the print, have it shipped to the studio and the bride or groom (probably the bride) are going to come in and pick it up.

As you can see we've calculated that we spend 15 min. finding, opening and retouching the image. We've set aside 10 minutes contact time with the client on the phone and 10 minutes time meeting the client in the studio to chat and $5 for shipping to our studio. Prosper™ has done the math for us, and calculated all of our costs and divided by 0.25. The total is $57. I'm going to just round that off to $60. So, you can see that with this business scenario, $60 for a 4×6 is the proper amount. And if the photographer educates the client about the quality of the print, it should sell.

As you can see, quite a bit has changed here. In this scenario, we've used numbers for an auto-fulfillment. This photographer shoots the wedding, does minimal batch retouching with an action and uploads the whole wedding for anyone to buy. After that, they are done. We've added the price of the print to the calculation and allotted 5 minutes for a quick call or email if the client asks about the delivery of the print. As you can see, Prosper™ has done the math for us and come out to $7 for a retail price on this print. I've rounded down to $6 for the purpose of this discussion.

So, as you can see, depending on how your run your business, $6 or $60 can be the right price for a 4×6 print. It all depends on how much work you are putting into the final product. The only mistake you can make is creating a fine art print and pricing it like an automated fulfillment print.

The simple matter of fact is, if you know your cost of goods then calculating your pricing is easy Junior High School math.

Prosper™ is a product of Fundy Software. You can find out more here about a free trial and the limited time pricing special happening right now.

Ever wanted to custom design a wedding or portrait album but didn't know how to go about it using Photoshop?

Well, here comes Fundy's Album Builder to the rescue. It's fast, easy and intuitive. But best of all, you aren't stuck using templates that can “date” an album. Now, there isn't anything wrong at all about using the free templates or those you find online for a fee. But if you are looking to keep your album designs fresh and truly unique, you should consider Fundy's Album Builder.

In the video tutorial below, Andrew Funderburg (aka. The Fundy) shows us how he used some of my images from Veena and James' Wedding in Morristown, New Jersey, to build a few pages very quickly. Of course, with Fundy having designed and used this program multiple times, the buttons and the options all seem natural to him. That will come in good time for you as well and you'll be amazed at how instinctively you will approach your layouts.

As Fundy says at the beginning of the video, I have known him for some time. He is a dynamic, energetic and passionate entrepreneur who is very interested in helping photographers. As one himself, he and his business partner Kevin Focht have taken the industry by storm with their frequent webinars and YouTube tutorials like the one you see above. The products that Fundy has developed continues to evolve thanks to input from their users – i.e. people like you. So, don't feel shy about sending Fundy a note with your suggestions.

If you have any questions or comments, do post them below. If you have used FAB, tell us what your experience has been like or even drop a link to one of your album designs. We would love to take a look!

As regular subscribers to Tiffinbox or new visitors, I have a special offer from Fundy for you. Take 15% off the price of Fundy's Album Builder, when you use the following code: “Seshu”

Other programs you may be interested in as well are Album Proofer and Batch-o-licious, also from Fundy. If you want to save $125, you've gotta check out the Total Studio Pack, which includes a slew of other neat programs that Fundy has created for the photography community.