The Mistake of Needlessly Increasing Your Expenses for Your Video Production Business

You will encounter many people who will have something to say about your video production business that may let you think about changing some aspects of managing it. One prospective client makes a comment about how they wish you had a particular kind of camera so you run out and arrange financing or drain your cash reserves to get one.

I know a lot of videographers who jumped on the High Definition (HD) bandwagon too early. Out of 20 potential projects, maybe one prospect would indicate that they were interested in producing their video in HD. So these videographers ran out and invested thousands of dollars (usually in the form of debt) to make the transformation from Standard Definition (SD) to HD.

Then, after they were ready to go, they quickly found out that anyone hardly knew the difference between HD and SD. When clients were presented with the costs associated with HD production, they more often than not chose to go with SD. Of course it makes sense on a lot of levels today to go ahead and upgrade your video business to HD production (if you haven’t already) but you certainly don’t have to do it all at once.

Take time to plan it correctly so it doesn’t hurt your cash reserves or so you don’t find yourself with another long-term loan that you’ll have to pay back each month for years regardless of whether you have the cash flow to support it.

An example of this in my video production business is that I’ve never had a legitimate production studio because very few of my productions actually require one. It has never made financial sense for me to pay for square footage that I don’t use.

My clients rarely ever have the need for one so I choose to rent studio space as needed instead of paying to have one at my disposal at all times. On occasion, a prospect will indicate that the reason they chose another videographer was because they had their own studio whereas I would have had to set up a temporary studio in their conference room.

When this happens, I often think, “Maybe I need to take the plunge.” But then I also think, “Yeah, but the 99 other prospects who’ve hired me this year obviously didn’t care if I had a studio so why should I weaken my financial position for the one person who had a problem with it?”

I know that having a studio makes sense for a lot of you but it has never made sense for me. I don’t see that coming yet. I am in the process of pitching several ongoing projects to clients and if I get them, it probably will make sense to invest in a studio but only because the cost will be built into the contract.

Final Thought: Before you make a decision that will cost money and send you off in another direction, take a step back and think about whether what you want to do will actually make a difference to your bottom line. More often than not, if you just continue to work your plan (assuming you have one) and take some time off when you feel like you are burning out, things will improve and you will steadily move towards your goal of success as a video production business owner.