Running Head: FAS 240 1
FAS 240 Module Six Worksheet
FAS 240 2
Directions: One of the key elements of your final project is preparing a startup budget for your
business. This budget should be based on the minimum equipment required to establishing your
business. Respond to each of the following prompts in the space provided and then submit this
document to your instructor through the assignment link in the learning environment.
1. Equipment Inventory
In order to develop an accurate start-up budget for the photography business, it is
fundamental to take into account the equipment that will be required to carry out the business
operations. The minimum required equipment that will be needed in order to start the business
includes a camera (USD 2500), lenses (USD 200), memory cards (USD 100), a tripod (USD
200), lighting equipment (USD 300), and editing software (USD 200). These are some of the
basic equipment that will be required to do the photography business. The estimated price of
each of the pieces of equipment has been identified so that they can assist in making the budget.
Apart from these expenses, a studio will also have to be taken on rent to carry out the
photography activities. The estimated price of the studio rent is USD 4000 per year. Internet
services will be required as well, and they may cost around USD 300. Expenses relating to office
supplies and furniture could be around $ 500. Expenses may also be incurred relating to
equipment service and repairs of USD 300. However, the actual cost that may be incurred for
purchasing the equipment may vary depending on their actual costs.
While making these purchases it is essential to prioritize the quality aspect of each of the
equipment since they have the potential to influence the quality of photographs that will be
captured for clients and customers of the photography business.
2. Cost Calculation
FAS 240 3
The startup costs of the photography business have been calculated. For calculating the
cost of starting the business, the income factors have been taken into consideration first. The net
income that is desired to be earned after adjusting the incurred expenses is USD 45,000. It has
been expected that in a year5at least, the business will be operational for 300 days.
Some of the annual expenses that were identified while making the calculation were
studio rent expenses, office supplies and furniture, and internet services. In the case of working
equipment and accessories, the price relating to software has not been included since it has been
mentioned separately under the ‘computer hardware and software’ category. No additional price
has been included for computer hardware since a5personal laptop will be initially used for the
photography business. Expenses relating to business insurance, advertising and promotion
expenses, postage and shipping, professional expenses, and miscellaneous expenses have also
been taken into consideration when arriving at the final annual expenses that will be incurred in
the context of the photography business.
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FAS 240 5
The final results that have been arrived at based on the computation indicate that the total
expenses/ final cost that will be incurred by the photography business on an annual business is
USD 10,300. The average expenses that will be incurred by the business on a daily basis is USD
34. 33. In order to earn the desired net income (i.e., USD 45,000), the expected pay that the
business must receive for each assignment is USD 184.33, and the expected net income that the
business must earn after adjusting the daily expense amount is USD 150. The expected net
income for the business, based on the calculation, is USD 55,300.
3. Potential Challenges
FAS 240 6
After calculating the startup budget for the photography business on the basis of the
minimum required equipment, it is essential to shift the focus toward the potential challenges
that could affect the ability to sustain the business over the long term.
One of the main challenges that may arise in the path of the business is related to
inconsistency in the availability of client work. It is a serious challenge that may adversely
impact the ability to generate income for the business. In order to overcome the challenge, it is
essential for the photography business to focus on seasonal promotional activities. Moreover,
efforts must be made to retain the existing customers of the business by communicating with
them about the latest offers and promotional discounts.
Another challenge that has the potential to hamper the sustainability of the business in the
long run is related to the existence of high competition in the market. It is another challenge that
the business must take into account since it may diminish its customer base and market share
(Lizarelli et al., 2022). An effective way to overcome the identified challenge involves
differentiating the photography offerings by focusing on personalization. The business must
ensure that the individual needs of its customers and clients are well understood and the offerings
are tailored to meet their needs in an effective manner. Another challenge is related to locating
suitable clients for the business on a consistent basis. To deal with the challenge, the business
must take advantage of popular social media networking sites such as Facebook and Instagram.
By using these platforms, the business can interact with potential customers and clients and have
a better chance of finding future clients for the business (Sigurdsson et al., 2021).
FAS 240 7
References
Lizarelli, F. L., Torres, A. F., Antony, J., Ribeiro, R., Salentijn, W., Fernandes, M. M., &
Campos, A. T. (2022). Critical success factors and challenges for Lean Startup: a
systematic literature review.5The TQM Journal,534(3), 534-551.
https://doi.org/10.1108/TQM-06-2021-0177
Sigurdsson, V., Larsen, N. M., Gudmundsdottir, H. K., Alemu, M. H., Menon, R. V., &
Fagerstrøm, A. (2021). Social media: Where customers air their troubles—How to
respond to them?.5Journal of Innovation & Knowledge,56(4), 257-267.
https://doi.org/10.1016/j.jik.2021.07.001
