I'll start by saying this: I currently operate my wedding and lifestyle photography business out of a studio/gallery located in our small downtown main street area.
I tell you this up front because there's a chance that my opinion is biased based on my experience (actually - I guarantee that my opinion is biased by my experience).
I've been asked by many of the photographers I talk to, about whether or not having a studio would benefit their business. It's a really hard question to try and answer for someone in a 5 minute conversation. It's even hard to answer in an hour-long conversation.
The factors that go into whether or not having a studio space would be the best decision for you - are far more intimate than can be evaluated without a lot of careful consideration and discernment.
I will share the reasons that having a studio was the best thing we've done for our business - as well as the pros and cons of having a studio space. As I work through this, I'm talking about a studio outside of the home - where you can either meet with clients and/or photograph sessions. My assumption is that if you don't have a studio space, you're either meeting with them at your home, their home, or in public locations (coffee house, etc).
First, the disadvantages of having a studio space:
1. Overhead. In any business, the more overhead you have, the higher the cost is to you, to do business. The less overhead you have, the more flexibility you have in making financial decisions about your business. Having a physical space can be expensive (anywhere from $8-$25 per ft/sq depending on where you are). Additionally, a studio space has to have electricity and heat. You'll probably add internet, telephone, taxes, and other monthly charges as well.
2. Liability. You're responsible for a space, for your belongings, and you're responsible - in many ways - for what happens to people in your space. You're also committed for a period of time to paying for that lease, and should your business fail - you'll probably be obligated to pay that lease regardless.
3. Maintenance. There are a lot of extra things you have to take care of when you have a studio. You have to fix things that break and keep it clean. Not only does this cost money - but it's more work than not having a studio.
4. Upfront Costs. Building out, and furnishing a studio can be a very expensive proposition. Purchasing furniture, work to display, office equipment, and everything else that goes into the space not only costs money, but takes time.
So why would anyone want to have a studio?!
1. It says something about you. The way you design your studio, and the space itself, say a lot to your potential customer about who you are, and the type of business you run. You have TOTAL control over how you present your work and your business, and have total control over your client's experience.
2. Set yourself a part. When clients visit our space, they are entering a gallery. We have a small shooting space as well, but it's clear that our space is designed to show off our wedding work. There are few photographers in our market that have anything close.
Most wedding photographers are meeting out of their home, or at local coffee shops. We are able to immediately justify the difference in our pricing and our work because of the experience clients have when the come to our studio.
3. Dedicated space to work. Even though client consultations and sessions are all by appointment only, I spend most of my working time at the studio. I'm able to have everything I need right there, and I can keep my work life - and home life, much more separate. When I'm at work - I'm at work. When I'm home - I'm home (most of the time!). I find myself much more productive editing, designing - doing all the things I do on a regular basis - up at the studio.
4. It's a HUGE marketing investment. I'm pretty aggressive when it comes to marketing, and our studio space is sort of the crown jewel of our strategy. We're located in an area with a LOT of foot traffic, and drive by traffic. We're right downtown, and people stop and look in our windows.
Our studio is about 10 blocks from one of the largest high schools in our state, and as a result, our Lifestyle Senior Portrait business gets a lot of word of mouth buzz. We're a part of our community, and the other businesses in our area are our advocates - they want us to succeed.
So, how do you know if having a studio space is right for you? It's certainly not an easy decision to make, but I will say this. Having a studio is an investment. You really have to be willing to make a long-term commitment to it, or there's less chance that the investment will pay off. We were SUPER fortunate that our studio started to generate more than enough business to pay for itself - from the beginning.
That's not always the case. In fact, we were prepared for it to be a much longer period of time before that happened. We were prepared to lower my salary by the cost of the studio lease, and we had to know that we could make that work. You should assume that you'll be investing for a year or more before you're generating more revenue as a result of the studio - than the additional expense it incurs.
ADDED: Let me finally say this. If you're a member of PPA, you'll do yourself a favor to read the PPA Benchmark survey, comparing retail studios to home studios. There are great benchmarks in controlling cost, and profitability that you should consider before deciding whether or not a studio is right for you.