Week before last I was contacted directly (no middle man), by a developer that needed dimensional (routed) signs for his new subdivision, which had to be done and installed by July 14th for their "Grand Opening". To make a long story short, I was my usual accommodating self and worked extensively with this fellow by phone and e-mail, even though I had never done any work for him before. I did no less than 11 different design variations, but his wife just couldn't make her mind up. Finally, early this Wednesday afternoon, he called and said they had decided on this design for the two 4' x 8' routed oval signs: (Click on pic to enlarge.)
I had given him a price of $3,750.40, or $58.60 per sq. ft. for both signs, 1" HDU, which included design time, two mounting templates and installation of the signs. He asked me how soon I could cut the templates and I said "Right away!" I dashed to Home Depot, picked up two sheets of plywood, came back and cut the templates to deliver to him tomorrow. I had no sooner finished cutting the templates and loading them into my truck when the phone rang. It was the customer. "Ummm, Mark, this is Jeff. Listen, I'm very sorry, but if you were to bill me for the work you've done so far, and you've been great, how much would that be?" I said, "Why do you ask???" he says "Well, Ive found someone that's a good bit cheaper. I don't want you to have done everything you've done for nothing. How much do I owe you?"
At the last minute, he found a friend of a friend of a friend that has a sign company that will do it all for $2,400.00, or $37.50 per sq. ft! I was floored! I'll work that price when I'm doing sub work for other sign companies, but that's when they supply all materials and the design! This was not the case!
He's going to give me $500.00 for my troubles tomorrow when he picks up the templates. I always say that a little bit of something is better than a whole lot of nothing, and he was extremely apologetic and somewhat embarrassed, but he can pay me $500.00 and still save $850.00 vs. my price, which was very much in line for this area. I did not offer to lower my price and he didn't ask me to.
I call it "CNC Proliferation". The machines have become so affordable that everybody and his brother has one (or so it seems), and the competition for business is becoming more and more intense, at least around these parts.
So folks, the next time you think about ol' Tucker as a "low baller" or a "bottom feeder", remember that the next time you loose a nice job to someone down the street that is practically willing to give it away! I'm just trying to make a decent living with decent pricing, and it's getting more and more difficult.
Thanks for reading this and letting me vent. Anyone than can advise me as to where I went wrong with this "non-job" is welcome to. Anyone that has similar stories to tell, that would be nice too. Posted by Glenn Taylor (Member # 162) on :
Mark,
Sometimes you can do all the right things and still lose.
quote: I call it "CNC Proliferation". The machines have become so affordable that everybody and his brother has one (or so it seems), and the competition for business is becoming more and more intense, at least around these parts.
Its happening everywhere. Competition is the lifeblood of a capitalist society.
Proliferation is one of the reasons why I won't buy a CNC or wide-format printer. At least, not anytime soon. Why buy the equipment and worry about making those monthly payments and maintenance issues when I can farm it out to a wholesaler? I'm concentrating on design and service as best as I can. That's got me busy enough.
[ June 27, 2007, 09:24 PM: Message edited by: Glenn Taylor ]
Posted by Jean Shimp (Member # 198) on :
Ouch! That's bad news. I have been following the router products fairly closely since we also have a CNC router and depend on it for a large percentage of our sales. Prices are definitely dropping on router cut products. Like Glenn says, it's not a good idea to buy expensive equipment when there is a price war on the horizon.
Posted by Mark Tucker (Member # 6461) on :
Well, let me ask you guys this; With the idea in mind that "a little bit of something is better than a whole lot of nothing", should I call this customer back and offer to meet my competitor's price? If the customer is going to pay me $500.00 anyway and get out for $2,900.00 total by using someone else, what if I said I'll meet that price and do it all for $2,900.00? I could still clear about $2,250 for 2 days of routing and painting and a half day for installing. I've already done the design and file work and can guarantee the product on time.
Use it or lose it, kinda. What say ya'll? Posted by Joe Crumley (Member # 2307) on :
A deposit of 50% solves the problem. That confirms the contract no matter what!
O, go ahead and do it for $37.00 a square foot. It's only money. Be a good fellow.
Posted by Mark Tucker (Member # 6461) on :
Joe, is a net profit of about $2,250.00 "bad money" for about 3 days work? I'm serious.
Posted by Kelly Thorson (Member # 2958) on :
No it isn't a bad profit....but you are setting yourself up for trouble in my opinion. There comes a time when you have to stand your ground...what message is saying "I'll do it for that" giving? That you were gouging him in the first place? I think your mistake was in the $500. If you worked extensively with him and did 11 different designs plus made two templates why aren't you charging him a lot more. If the other fellow is using your design then he made out like a bandit....no wonder he can do it so cheap.... For future reference the answer to his question as to what you wanted for your time would have been the difference between what you had asked for and what the other guy charged. If the other fellow is using his own design....then I wonder if maybe his wife liked that one better.
Posted by Si Allen (Member # 420) on :
If you are not starving...take the $500 and let the lowballer have it....then go see what kinda job he does!
Any bets the customer will be back next time, and not looking for a lowball price?
Posted by Dick Bohrer (Member # 905) on :
I just had a customer a couple of days ago, a lawyer (flags went up, lights flashed) He owns a bunch of condo's on Lake Superior. He says "Well give us a design and a list of materials and we'll see if we like your design and price". We want 2 carved signs and we need them by the second week of July. Just the way he talked he seemed to be shopping or looking to steal a design. So I said well we don't design on spec, carved signs go for $75.00 a sq foot, thats $4800.00 picked up at the door, installs are billed at actual costs of $60.00 an hr plus materials. We'll draw up a design if you agree with the ballpark cost and sign a contract to buy from us. I'll come up with a price plus or minus the ballpark when the design is finished and by the way were booked until September. "Well I don't know I'll have to think about it". Low and behold a couple of days later he calls and says OK go ahead Oh I say by the way I need half down before we proceed. I don't know what changed his mind but I've been shafted by both lawyers and realtors, I trust neither. Why do I write this- here I am cutting vinyl at 10:00 PM and drinking Wild Turkey. Things are getting over my head, never been backed up this far before. What really ****es me of is I've only been fishing with the kids once since May 15. Working 14 hr days 7 days a week, isn't self employment joyous?
Posted by Glenn Taylor (Member # 162) on :
I think Kelly nailed it. She's exactly right, IMHO.
Back to something you said, Mark.....
quote:Joe, is a net profit of about $2,250.00 "bad money" for about 3 days work? I'm serious.
It depends. To me, no it isn't bad. But, it ain't great either. It just depends on how hungry you are. A couple weeks ago, I sold a $4000 carved panel project similar to the Cedar Ridge project I did a few months back. When all is said and done, I'll have about 8 hours in the entire project. My net profit will be $2100. Which would you rather have?
So, what can any of us do to deter and perhaps prevent a similar situation in the future?
Well, getting a deposit before anything is done is the first and best step. Customers are less likely to continue shopping price by then.
The other is to build a reputation to the point where folks simply don't bother to shop around. Its a more difficult step to reach, that much is certain. But it can be done given the proper amount of time and effort.
I could be wrong, but I suspect that the guy who got your project was starving for work. How hungry are you? I know this may counter intuitive to some, but I've found that people who low-ball prices because they're hungry for work tend to stay hungry and ultimately starve to death. Not so much from the lack of work, but from not ending up with enough money to do anything else.
My suggestion..... don't cut your prices and don't lose any sleep over the matter. Spend your energies on the projects you do have.
.
Posted by Dick Bohrer (Member # 905) on :
Si- your Lebanese Garlic sauce is right on the money, I've been on a garlic high since you posted it. Plus it keeps the skeeters and no see ems away
Posted by Donna in BC (Member # 130) on :
I'm also a believer in not simply lowering the price. If you lower the price, you should be lowering the level of the project as well.
Just continue to do the best work YOU do. They'll come back again for that fact and then you can educate them on your higher pricing structure just because you're that good. Posted by Mark Tucker (Member # 6461) on :
Interesting takes on this. Thanks, everyone.
I just got off the phone with Rapid Ray and we discussed this at length. He is not for or against me lowering my price, and agrees that it's up to me.
I can't help but think about the jobs I've had in my life where it would have taken me a month (or more), to clear $2,250.00, working for "the man" and punching a time clock. Now I am in a possible position where I can clear that in a few days on this particular job, even though it would be for less than what many say it should be worth. (And I agree!)
I am not starving by any means, but when my router table is sitting idle, it's not making me any money. I'm wondering how many folks that have read this and have not posted are thinking; "Gee, if I could make that money in a few days of relatively easy work, I'd do it!"
I gotta sleep on this.
[ June 28, 2007, 12:14 AM: Message edited by: Mark Tucker ]
Posted by Si Allen (Member # 420) on :
quote: I am not starving by any means, but when my router table is sitting idle, it's not making me any money. I'm wondering how many folks that have read this and have not posted are thinking; "Gee, if I could make that money in a few days of relatively easy work, I'd do it!"
But then everyone will expect you to do retail for wholesale prices!
[ June 28, 2007, 01:23 AM: Message edited by: Si Allen ]
Posted by Mark Tucker (Member # 6461) on :
quote:Originally posted by Si Allen:
quote:
But then everyone will expect you to do retail for wholesale prices!
No, not everyone. This is probably a one-shot deal, me thinks. Si, I subscribe to your notion that you should get as much as you can, and price it so high until they start laughing, all that. It's just hard for my greedy ass to turn down this potential profit and let someone else have it without a dog fight. I can still make good money without a lot of effort at minus $850.00. That's just the facts. I have time to do the job, no big deal.
Should I just roll over and let the next dog have it? Who is to say that he won't do a fine job?
Everyone in this business faces competition, some more than others, depending on location and what you specialize in. I only do routed signs. No painted signs, no vinyl, no prints,...routed only. I've been successful at it for going on 7 years now, but it's definitely getting tougher, and this case is a prime example.
Competition and proliferation. Damn! Posted by Rodger MacMunn (Member # 4316) on :
Mark, I'd think that if you're offering up exactly what the next guy is with his router, you can probably expect more of this. I don't think you're a "lowballer" , however, please don't lower your price to get that job. Then you'll be perceived as not knowing what you should charge........... I had a competitor once who had no idea his costs, & was terrible at estimating time. He'd low-ball a job to get it, than start cutting corners once he realized he was losing his ass. He is now refinishing furniture.
Posted by Glenn Taylor (Member # 162) on :
quote:Should I just roll over and let the next dog have it? Who is to say that he won't do a fine job?
My answer would be "yes, let the next dog have it."
So what if he does a fine job. He's only reproducing your work.
Did he design it? No.
Did the client come to you first? Yes.
Did the client come to you because he thought you were cheap in the first place? Probably not.
What will you do next time? Get that "non-refundable deposit" up front.
What will you be next time? A better salesman and a better businessman.
.
Posted by Ian Stewart-Koster (Member # 3500) on :
Dropping your price to get the job will provide you with amazing word-of-mouth advertising toward others who want even better, for even less- a 'how low will Mark go' competition.
I'd do two things- charge more for time spent, as Kelly says, except I'd increase it further to $1100, so he's better off staying with you, or IF you decide to drop the price, then make it clear the standard drops too- perhaps no installation, or less fancy finishing, or whatever- they can choose what to leave off to save themselves money, but your hourly rate remains the same.
Price dropping like that, without qualification for it, is a statement- "yeah I overcharged you, sorry you found out, ho-hum..."
Posted by Joe Crumley (Member # 2307) on :
Let me see now.
No Contract No Deposit A dozen free drawings 3D sign Installation. Price: $58.00 per square foot!
After all, It' not Mark's fault! It's the cheepeee competator and bad customer who's at fault.
This a live, Classic Bottom Feeding Frenzee and fun to watch. Lets hear more! Makes me want to get out my snorkel and flippers.
Lowballers Unite!
Posted by Raymond Chapman (Member # 361) on :
If you ever lower your prices on the same product you quoted, you are telling the client that you orginally overpriced your work.
Sure, lower the price - do it for half the price of the low-baller. Hey, you might make $100 and that's better than nothing, right?
Mark, you said it was a one time thing. Don't bet on it. You are part of a downward spiral that doesn't change. There will always be someone who will do it cheaper than you, no matter what you charge.
It sounds like you were replaced by someone who plays your game better than you. Folks here jumped on you rather heavily when you were doing dimensional work at half what the rest of us charge, but you stated that you were making good money and still had time to go fishing. Well, someone took your advice and decided to do it for less and maybe they are still making money too (and even fishing). What goes around, comes around. You've just been bitten by your own philosophy.
Posted by Tim Whitcher (Member # 685) on :
I would've charged him $1,350.00 "for my time so far". Design and consultation is everything.
Posted by Ricky Jackson (Member # 5082) on :
quote:Originally posted by Raymond Chapman: You are part of a downward spiral that doesn't change. There will always be someone who will do it cheaper than you, no matter what you charge.
Very well put and my sentiments exactly. You can't let someone else set your prices. Just remember what the late Mike Stevens told me once: "Water seeks it's own level." There's another good paying job just around the corner, probably coming your way today; just be on the lookout for it, stand your ground, listen to the customer, charge your price, get the deposit, do your best design, and watch your "competition" uncerimoniously disappear. Every time a new phone book comes out here, there are from 2-4 new "sign companies" in there, offering everything from LED signs to digital graphics. I seldom if ever even hear of them from a prospect. Most of the time they are gone without a trace within 3-4 months - only to be replaced by another set of morons that think they can compete with me. Hang in there bud.
Posted by Michael Heaton (Member # 7731) on :
Hey Mark. Consider discussing the sign blank. Talk about your choice of wood and how you select it, shape it and the type of glue. Explain how your years of experience and intimate knowledge of wood signs in your region have lead you to these choices. Explain why you use the sealers, paints and how they perform outside in the elements and how long you work has stood up. Why the choices you make are the standard of your industry. How, perhaps, if it were you in his place you'd want the very best product because the sign has everything to do with drawing clients through the front door. Arm/educate the client with questions and send him to the lowballer. Be on his side and look out for him. You'll gain his confidence. He will call you back, perhaps with an easy payment plan for the outstanding $850 or you can offer a plan. I bet he'll call you back either way.
Posted by bruce ward (Member # 1289) on :
no deposit money was mentioned. instead of "rushing out" to home depot you should have rushing over there to get a down payment check. 50% down says it all. cusotmers suck these days. its all about the money. I hope the sign they get deteriorates within the year....and it probably will. if this guy calls you back i would not even entertain the thought of doing any work for him...hes an unfaithful customer
Posted by Mark M. Kottwitz (Member # 1764) on :
yeah, I'm in the same boat here.
I have a friend that owns a hair cut place, and I had done a bunch of work for her when I was doing work for a local sign company.
She is moving to a new location, and I gave her a quote to letter her (2) new windows, an illuminated sign on the roof, and a couple of other things. A couple of weeks go by and a banner shows up at her old place, and a banner at her new place. Then the windows get lettered. My fiancee goes in to get her hair cut, and the owner tells her that the new place in town did all the work for $125.
I just want to scream...
Posted by Ricky Jackson (Member # 5082) on :
quote:Originally posted by Mark M. Kottwitz: I have a friend...
Are you sure Mark? Do you feel that stabbing pain between your shoulder blades? I call anyone that sells me out for a few dollars a "former friend". I wonder if the other sign guy is going to get his haircuts there?
Posted by Mark Tucker (Member # 6461) on :
Well thanks everyone. Even you, Joe, with your usual snide remarks. I slept on it and I'm over it. I'm not going to lower my price. I'll take the $500.00 and feel fortunate to get that. As far as the deposit goes, that was to come when I delivered the templates. I can honestly say that this is the first time this has happened to me on a job like this, so lesson learned. Am, I the only one still learning lessons out here, or does everyone like Joe already know everything already?
Posted by Glenn Taylor (Member # 162) on :
Ricky,
I wouldn't call it stabbing someone in the back. There is an old Arab proverb..."Live like brothers, do business like strangers."
That is how I would look at it.
Posted by Raymond Chapman (Member # 361) on :
Mark...that old guy Joe may not know everything, but he's very close to it. And while his remarks may have been a little sharper than what I would have used, his advice is sound. Anyone that has been in the sign business for 90 something years is bound to know something.
We all learn from our mistakes. You can learn from this one. We can also learn from the mistakes of others, and I think that is what Joe (and a lot of others) are trying to help you with.
A lesson I learned the hard way - the deposit comes before you do anything. Saves a lot of headaches down the road.
Posted by Mark Tucker (Member # 6461) on :
Well Raymond, you know as well as I do that Joe is always "sharp" with me, no matter what I say or do. It's alright, though. I can take it! Posted by jimmy chatham (Member # 525) on :
go fishing.
Posted by Mark M. Kottwitz (Member # 1764) on :
quote:Originally posted by Ricky Jackson:
quote:Originally posted by Mark M. Kottwitz: I have a friend...
Are you sure Mark? Do you feel that stabbing pain between your shoulder blades? I call anyone that sells me out for a few dollars a "former friend". I wonder if the other sign guy is going to get his haircuts there?
Yes and no. I go there because she does a good job when she cuts my hair, and we usually all go in at the same time (me, the fiancee, and the step son), so she cuts us a break when we go to pay. I will say that she did order her business cards from me (and she was quite pleased with the turn around time, cost, and quality).
My beef is with the new guy that did the work. The total was (2) 30" x 72" two color banners, one set of hours on the door window, and (2) 60" x 60" windows in 3 colors, all for $125. Maybe I'm just being greedy...I mean, I want to cover the costs and make a little money to cover my time, equipment, power, and mortgage... Posted by Donald Miner (Member # 6472) on :
Mark, I have BTDT. One time, I had a customer that needed some screen printing done on nylon jackets, I quoted the price , both with and without jackets. A sporting goods dealer, also a wholesale customer of mine, furnished the jackets printed with heat transfer lettering which promptly fell off. When I was approached about the problem, I merely said, well my friend you got what you paid for. "There is nothing that cannot be made a little worse and sold a little cheaper, and those who shop by price alone are this man's lawfull prey." Would you believe that I kept both accounts? Amazing, but true. You are the only one who knows what your overhead is and your pricing has to be determined accordingly.
Posted by Ray Rheaume (Member # 3794) on :
Congratulations, Mark.
You have neither lost anything nor are you putting anything else at risk.
The client has compensated you for your time at a price that you have determined was fair and amiable for the work completed. No losses there.
No, you won't be doing the sign itself, but I don't consider that a loss either. Without a deposit, it is still a "potential" job, not an in house job. As I said on the phone last night, you can't lose what you never had.
I also commend you for not risking involving yourself in the price wars and the reputation it can lead to. Although you may have felt that it was initially a "reasonable profit margin", it seems that what it's worth beat out what you would settle for.
Good choice, Tuck. Rapid
Posted by Deri Russell (Member # 119) on :
Mark not only did you get paid for the time you spent. But you also, maybe unintentionally saved your business. What if you dropped your price and that guy went out and told 3 people that he got signage from you at a fantastically low price. And they told 3 people ..........Now the word is out that if you want alow priced quality sign get Mark Tucker. And that would blow.
Posted by Cam Bortz (Member # 55) on :
Mark, you described Joe's remarks as "snide", and they were... but remember where this comes from. Anyone who's been in this trade more than 15 or 20 years remembers how the proliferation of vinyl plotters drove the prices for "ordinary" sign work through the floor. Those prices have never recovered; there are still plenty of shops selling truck lettering for less than a competent painter charged in 1987. Now the same thing is happening with dimensional signs; while doing the actual work was protected by a steep learning curve, the prices stayed up; as soon as machines became common, there are people selling them for minimal margins.... and the irony of this is that YOU ARE ONE OF THEM. You described yourself as a "catfish", well, my friend, this is your wake up call to tell you there will always be another catfish that will swim even lower and suck even harder.
Your experience is exactly why selling signs by the pound is a loser's game, no matter how much equipment you have. Those of us who sell dimensional work for $100, $200, $300 or more per square foot do so because we don't sell signs, we sell an image. People pay us these comparatively large sums because we do the kind of work that the machine operators can't do, and they see it, want it, and write checks for it. Large ones.
I'm not trying to jump on the "bash Tucker" bandwagon, but the bottom line is, you made this bed, and you won't get much sympathy complaining that somebody stole the damn blankets. Maybe now you'll pay a bit more attention to what people like Joe and Ray and Grampa Dan and others are trying to say here.
Posted by Dana Stanley (Member # 6786) on :
Mark did you tell him he could have the rights to the design? If not after you cash the check you might tell him for anoyher 300 he can use the design too.
Posted by Jillbeans (Member # 1912) on :
Deposit first. ALWAYS...no exceptions. Period. Before you ever even turn on your computer.
Never come down, once you lower your price you can never raise it back up again without seeming like you are a crook.
Love....Jill
Posted by Ricky Jackson (Member # 5082) on :
While I think your prices are a little low, I don't think they're unreasonable. Only you can best decide how much your market will bear and for anyone else to get in your face is simply presumptuous - especially if they are from over 1,000 miles away. I've been charging $70 sq/ft for sandblasted signs for several years and I charge even more if it's more complicated. Don't let anybody tell you they have always done things perfectly; we've all gotten screwed and we're all still learning. You didn't describe yourself as a bottom feeder and I wonder how many read your post accurately before posting. Like Glenn said "Sometimes you can do all the right things and still lose." Cam's remarks about how the proliferation of vinyl plotters changed this business - for the worse - is dead on and it still sickens me if I think about it too long. 25 years ago I could get $300 - $450 for a nice s/f 4x8 mdo. I took pride in doing it; I usually got 2-4 weeks to work it in; the customers were very appreciative and I looked forward to the sweet smell of reducers and One Shot in the morning. It will happen (and has) with large format, CNC routed and anything else that a computer can be used for. Do the best you can do; deal with integrity; give the customer more than he expected and do it on schedule.
Posted by Cam Bortz (Member # 55) on :
Ricky, Mark has called himself a catfish - a bottom feeder - repeatedly in this forum; I didn't make that up. And yes, he has to find his own market level and the prices his market will bear... as long as he is doing the same work other people can do for less. The only way to get custom prices is to do custom work, the kind nobody else can or will do.
Posted by Glenn Taylor (Member # 162) on :
Have we beaten up on Mark enough yet?
.
Posted by Mark Tucker (Member # 6461) on :
Haha, Glen, good one! I get smacked around regularly in here, but like I say, I can take it,... and I take it with a grain of salt.
Cam, I gave myself the nickname of "Catfish" after I was repeatedly called a "bottom feeder" by Joe Crumley. I've been insulted in here by you as well about a year ago, but you may recall that I refused to return the favor. I have what some folks in here seem to be lacking,...a sense of humor.
I want the records to show why Joe Crumley belittles me every chance he gets. I first bumped heads with Joe maybe 2 years ago on the ShopBot forum. We were discussing sign making and I made the remark; "It's easy!" I was referring to my years of work as a sign designer in the 70's and 80's where I toiled away on a drafting table all day and how computers have changed all of that and made things so much better, faster, and...easier! Joe mistook my comments as to suggest that "any idiot can design and make a sign." He took high offense to that and immediately became insulting. I tried to explain to Joe that he had simply misunderstood me, and even went so far as to send a detailed e-mail about what I was trying to say after he kept up his attacks in there and in here as well. Didn't seem to do any good, however. Oh well. My Mom told me when I was young, she said "Son, no matter what you do, what you say or how you act in this life, not everyone is going to like you!" Wiser words were never spoken, and we ALL know that to be true for each of us, no?
Funny, I see sign shops in my area going belly-up all the time. The local "SIGN-A-RAMA" bit the dust just last month, and I know of a few others that are either for sale or just barely hanging on. I just keep doing my thing, staying busy and socking money in the bank, loving my work with no real problems or worries as a one man operation. Life is good, work is fun, and I'm going to be around for a long, long time! Posted by Frank Magoo (Member # 3950) on :
Might I interject here?
We are all grownups here, or should be...airing of personal dirty laundry shouldn't be a topic of discussion in here...no matter who the player/players...
If ones remarks are cutting or such, ignore them...to answer is to incite more...
Of course I'm an optimist, the world is overall good to me, even if it's lined w/instigators at every turn...if everyone would just take a chill pill and mellow out, life would be just awesome now wouldn't it? You're right, life would probably suck if ppl. treated each other nice all the time...
Posted by Dan Sawatzky (Member # 88) on :
As I read through this thread it reminded me of why I like to do one off - custom work. Cam's post above sums up my thoughts.
quote: ... he has to find his own market level and the prices his market will bear... as long as he is doing the same work other people can do for less. The only way to get custom prices is to do custom work, the kind nobody else can or will do.
Amen Cam.
-grampa dan
Posted by Dave Sherby (Member # 698) on :
Ray, Cam, Grampa, .... right on.
I'm jumping on the router bandwagon. I'm not going to lower my prices just because the router is working while I'm doing something else. I'll raise them, after all, precision work should command a higher price. It's work that can't economically be produced any other way.
We're designing signs and having to ditch certain elements we'd like to incorporate into the sign because it's just not economical to do the work by hand. Sure I could sub it out. I just subbed out some work to Ray Chapman's "pea shooter". But a 4x8 hdu sign will not be cheap to ship. Savings from no shipping costs will help make those router payments.
I was also looking into a printer. I decided to go with a router instead. Digital prints can be shipped easily and cheaply... no weight.
Posted by Mark Tucker (Member # 6461) on :
Like I said before, I did not offer to meet the competition's price. Enough was enough, although if I had done so and got the work, I could have made $800.00 a day x 3 days = $2,400.00, net.
$800.00 a day, easy work. Think about that. $800.00 a day. Now evidently, according to some in here, that ain't ****. I keep forgetting that I'm in the company of millionaires in here, and some of you fine-haired people snub your noses at money like that. Incredible! Posted by Dave Sherby (Member # 698) on :
Mark, you're missing the point. $800 a day is a lot of money IF you can do that amount of work every day and IF you have no overhead and IF your cnc was free and IF your cnc will never need repairing or replacing, etc. etc.
Most of us need to make more than $800 a day when we can, because there's going to be days when we make nada. Now that $800 day is only a $400 day. And when the word gets around about your discount, your $800 day may drop to a $600 day and the downward spiral will be tough to stop.
I think you are treating your signs too much like a commodity. Does an accomplished artist charge $120 dollars for a painting that only took him a couple hours? H*ll no. He gets what it's worth. We need to get what our signs are worth , not what sounds like a decent amount of money on the surface.
We are making a custom product, not cranking out a commodity. Your customers are going to make a h*ll of a lot more money from a well designed sign than you are from making it.
Hey, maybe we should, as an entire industry, give our signs to business' at no charge, plus 1% of their gross sales. It would eliminate low balling and we'd have to give them an effective sign to make good money. I think I'll start a new thread on that idea.
[ June 29, 2007, 01:51 AM: Message edited by: Dave Sherby ]
Posted by Mark Tucker (Member # 6461) on :
Well let me take a poll, if I may. Alright, folks, who amongst you besides Dave would absolutely refuse to go to work for $800.00 a day net? Speak up.
[ June 29, 2007, 08:53 AM: Message edited by: Mark Tucker ]
Posted by Dave Sherby (Member # 698) on :
Again, you're missing the point.
Don't try hunting... stick with fishing.
Posted by Si Allen (Member # 420) on :
I would....if it was going to cost me more in the long run of things!
Posted by Mark Tucker (Member # 6461) on :
I'd go to work for $800.00 a day any day and every day! I think I'm gonna change the name of my company to "Blue Collar Signs". Posted by Donald Miner (Member # 6472) on :
And the pastor said "AMEN".
Posted by Cam Bortz (Member # 55) on :
Mark, the point everyone is trying to make is that your question about $800 a day is entirely arbitrary. Sure, $800 a day, free and clear, sounds great - but the reality of this business being what it is, you are NOT going to make that every day, and as your original post described, there will always be downward pressure on your pricing by other people who believe they can do the same work for less. Then take into account that there IS overhead, that your equipment WILL require maintenance and/or replacement, and you could easily find yourself not doing nearly as well as you think.
As for the insults, here's where I stand... Yeah, I've made some less than flattering comments here. If you think you get called names, you should try, as I have, to encourage people to charge MORE and give examples of what's possible. I've been called everything from a A (***hole) to L (liar), and it's one of several reasons why I don't spend nearly as much time here as I used to. Frankly, I find this forum does as much to damage personal relationships between letterheads as it does to encourage them, but that's just IMHO.
But you know what else is insulting? When people with a lot of experience offer advice and discussion, on an open forum where advice is encouraged and appropriate, and that advice is disparaged, mocked, and condescended to by someone like yourself who goes to great lengths to tell us that you have it all figured out and don't need anyone to tell YOU how to do anything. That's insulting as well, whether you want to admit it or not. Fact is, you like pushing peoples buttons in this forum, and you love the attention it gets you. For myself, I'm genuinely glad you are happy with your situation and making decent coin - but when advice and discussion are offered here, you could learn to be just a bit more respectful of it, and of the people who offer it. As for whatever personal issues you have with individuals here, that's not my concern - I've never met or communicated with you other than on these pages, so whatever we say to each other is based ENTIRELY on what's written here - there's no "back story" between you and I. So if you wonder why I might sometimes think you are something of a smartass, well, the only way for me to get that idea is from what you write here; by the same token, if I come across as a pompous know-it-all, that's as much my fault as anything.
And this subject has already taken up way too much space in my head....
Posted by Raymond Chapman (Member # 361) on :
For the life of me, I can't figure out why this dead horse won't move.
But I'll try one more shot. Mark, are you telling us that you would show a $800 PROFIT each day for three days on this job? Or $800 net? There's a big difference. And what about the days spent in designing and running to Lowe's that you were paid $500? You didn't have a $800 a day profit for that time.
Sure, I would work under that scenerio if I could CLEAR $800 a day, EVERYDAY. That would be a PROFIT of over $200,000 a year. But I don't think you are doing that (or me) nor do I think that you can do that under your set up. There are some days that I might put that much in my pocket, but not many because there are days that I spend designing or a thousand other details that must be addressed. Then there are the Murphy Law days.
While your overhead is very small, as you have said, there are still expenses, and there will be days when everything goes wrong and you actually lose more than you make. That puts a rather large hole in the good times.
It's obvious that your business plan is something to which you have given considerable thought and are convinced that it is right. More power to you. You and I think differently. As long as you are happy with your set up and I'm happy with mine then the world seems to be peachy-keen.
Posted by Tim Whitcher (Member # 685) on :
When I owned my own business, it cost me $2,500.00 a week just to keep the lights on. After material and overhead, I found out that if I couldn't pocket $150.00 a day, I was screwed. Well, the economy dived in Michigan, and I was screwed. Posted by Mark Tucker (Member # 6461) on :
Cam, you got me all wrong, buddy. I'm not out to push anyone's buttons and I'm certainly no attention whore. I have a different philosophy about things and I state them, that's all. I have never intentionally insulted anyone in here nor will I. I'm sure if you and I met in the real world, we would get along just fine. Like Gramps says, the internet can be a poor place to communicate.
Raymond, the job I turned down would have netted me $2400.00 PURE PROFIT and I could have completed it in 3 days. That's $800.00 a day.
Posted by Raymond Chapman (Member # 361) on :
"At the last minute, he found a friend of a friend of a friend that has a sign company that will do it all for $2,400.00"
Now, I'm getting more and more confused.
You were thinking of matching the other guy's price of $2,400 and it would take you three days and you would make a profit of $800 a day - clear. Three times 800 is 2,400 which is the selling price. What about materials and overhead?
Must be the New Math.
Posted by Jon Jantz (Member # 6137) on :
Raymond, he's figuring the $500 he's already been paid would cover the cost of the materials and design time... so that'd actually be $2900 he got paid for the entire sign.
Mark, one day you're gonna learn.... it doesn't work to argue real world logic with principles here in Letterville. You will never get a go-ahead from the old-timers to bump your price a little bit to get a job. That would be admitting that you are on the level of the competition around you, and that will never work.
On the other hand, I promise you that anyone here that is still in business, has adjusted their prices a few times to get an easy-money job they wanted. It may have been BEFORE they gave the price to the customer: they bid it just a little lower than they normally would have, because they knew the other shops who were going to bid on it... or it may have been afterwards, cleverly disguised as 'well, we can leave off this flourish and it'll save you $500..'
Now that goes for companies who are NORMAL sign shops, not ones that only specialize in something like hand-carved gilded signs that only THEY can do...
Don't get me wrong, I respect the pros here and have learned a TON... but I do think that if you spent a week in some shops, you'd find them to be a little more normal than what the owners like to portray here....
/putting flame-retardant suit back on.. //phew this thing is hot in the summertime...
Posted by Todd Gill (Member # 2569) on :
I'm with Jon here...I think people are ganging up on Mark a bit....
and I don't think I would believe that none of the "old timers" have ever compromised their Esti-Mate prices to get a job that while lower than what they might hope to get, would still net them a significant profit.
[ June 29, 2007, 12:49 PM: Message edited by: Todd Gill ]
Posted by Dave Sherby (Member # 698) on :
Ray said it, Cam said it, I said it, Mark doesn't get it. I give up.
Posted by Jon Jantz (Member # 6137) on :
quote: Mark, you're missing the point. $800 a day is a lot of money IF you can do that amount of work every day and IF you have no overhead and IF your cnc was free and IF your cnc will never need repairing or replacing, etc. etc.
Most of us need to make more than $800 a day when we can, because there's going to be days when we make nada. Now that $800 day is only a $400 day. And when the word gets around about your discount, your $800 day may drop to a $600 day and the downward spiral will be tough to stop.
One thing I'd like to have explained. I'm not being a smart-a$$, defending Mark's position, or trying to start trouble. I totally understand from a matter of principle where Dave, Ray and Cam are coming from.....
However, all three of you have said.. "yeah, it'd be great if we could make $800 profit every day, but you have all this other stuff that makes this not possible..." What in the world does that have to do with the fact that he DID have a job that would make $800 a day in front of him... and how does turning down that job for less profitable jobs HELP his bottom line?
Other than the part where you think the whole world is going to find out and come beating down his door for lower prices... (which I find to be a little dramatic, you could offer FREE signs and the advertising wouldn't get around THAT good) what would be the harm in taking this job? Turning down an easy $800 a day, seems like a SURE way of getting to the place of making 'NADA' as Dave said....
"The big picture, the big picture..." you say. Well, in the big picture, if he insists that his signs are worth way more money than the customer and/or competition thinks they are, he'll not get ANY work.
Again, I understand the principle of pricing by the signs value, rather than by the actual materials.. but as all of you have said, the type of work Mark specializes in and also the area that he's in, he will not be able to command a super-high price for his work just because he and God knows it's overall advertising worth over the next 10 years. If he continually turns down good-profit jobs because a bunch of folks that are in a totally different market and niche tell him to, he'll be out of business in no time...
It's easy to say, start offering a totally different type of product and you can command the prices you want. That's easier said than done, and not even possible in some areas... for example Cam Bortz is (apparently) very successful in his area in Connecticut, and is probably known far and wide for his high-end work. But I promise you, if he moved down here, he would never sell a sign in Atmore, AL, and would even have difficulties making it in Pensacola... the demand for his type of work is just not that great here.
It's comparing peaches and grapes, folks...
Posted by Raymond Chapman (Member # 361) on :
If I'm not mistaken Mark began this thread complaining about the low ball price of his competitor and is now defending that same price as something he can get rich doing. Why did we change horses in the middle of the stream?
Certainly, $800 a day is nothing to sneeze at, but I can't see how he's going to do it. The first $500 was for 11 designs, template and a quick trip to Lowe's along with the time spent with the customer. There's no way possible for that to come up to our $800 a day standard, so we are already borrowing money from the three day production schedule. And there is still HDU to buy, paint for the finishing and some type of installation (which probably is figured in the three days allotement). No one works without any overhead, so we are slowly diminishing our $800 a day ideal.
Even with subtracting the cost of materials, overhead, insurance, equipment payments, and depreciation, there could still be a sizeable profit at the end...but then we have to do the same thing the next three days....and the next and the three days after that, without loosing any more time doing 11 designs and running to Lowe's.
Sorry Jon, that sounds more like real world logic to me.
Posted by Donna in BC (Member # 130) on :
I believe the real issue here is downscaling the price just because. What possible reason do you have for that customer if you do that? Stick with what you originally quoted, or if you move the price down, ensure you remove something from the project as well. If you want a lesser model of something elsewhere, naturally you pay less.
Or is this a post on how we can lower our prices to get the job after all? If that's the case, then we can analyze that aspect. The only way around that one I can think of is, offer to sponsor part of the cost for your name or plaque somewhere for advertising. Or swing in another benefit of some type.
Just don't move it lower just because it's what THEY want. We run our businesses, no one else does.
Posted by Deri Russell (Member # 119) on :
Mark I've changed my mind. I definitely think you better call that guy back and go for the job. Right now. Call him. You better do it for less than the $2400 though. Because you've already got $500 out of him.
Why did you start this thread again? Posted by Todd Gill (Member # 2569) on :
Let's remember this the next time we go car shopping.....please pay sticker and never negotiate the price. The salesman has to eat, remember....and to dicker him down is to diminish the value of the car and his ability to operate.
Don't use coupons at the grocery store, nor ever take advantage of "Sales" listed in the paper. Demand to pay full price.
Sometimes taking a little less than you normally would is acceptable - at least I think....I'd weigh the job, it's repercussions and make the decision.
I think it's ridiculous to think that just because you cave a little on price with a particular tempting high-dollar job - that all of a sudden the entire town will know about it and will demand concessions on every future job.
Donna makes a good point though on perhaps simplifying elements that might have otherwise been time consuming....worth considering.
Edit: Dan does make a good point in that if you have a niche market as he does - you can more easily command a particular price. Where else are people going to get what he has to offer??
This is definitely not apples to apples in comparison to what Mark does though.
[ June 29, 2007, 02:37 PM: Message edited by: Todd Gill ]
Posted by Deri Russell (Member # 119) on :
Do you have sales Todd? Last week Mark was asking X number of dollars but this week he is considering having a sale? Is that what you mean?
And just for the record, if I give a price to a customer around here, yes-everybody expects the same price. Why? Because its a small town. And yes everybody does know what I charged Jo Blow at the gas station. And Jim Blow expects to get that price because he is Joe Blows cousin.
Maybe Mark lives in a very large community that nobody talks. If he does he's got no problem then.
Posted by Raymond Chapman (Member # 361) on :
The lower price is a 36% discount. That's not just knocking a little off for one of the good old boys.
Sure I use coupons because the seller offers them and I get a used car for a little less than the sticker price because the salesman will come down. In both cases I know that the orginal price was not "really" the price. Have you ever seen a time when mattresses where not on sale?
I'm in the business of selling images. I don't offer coupons or have sales. Yes, sometimes I will give someone a break just because I like them (or even do it for free), but it is my decision, not something that I am forced into in order to get the job.
I'm just stubborn enough to not play the game of working one side against the other.
At one of the seminars I attended in Charlotte, the speaker said that when you present a price you say, "The price is..." - not, "the usual price" or "our regular price" ...just THE price is.
I'm tired...must be time for a nap.
Posted by Dave Sherby (Member # 698) on :
I re-read Mark's post.
quote:Originally posted by Mark Tucker: Anyone than can advise me as to where I went wrong with this "non-job" is welcome to.
You didn't go wrong Mark. You are not going to get every job that comes along. Nobody does. You were going to lose this one to the low baller, and yes it sucks, but like someone posted earlier, there's always someone who will do it cheaper.
quote:Originally posted by Mark Tucker: At the last minute, he found a friend of a friend of a friend that has a sign company that will do it all for $2,400.00, or $37.50 per sq. ft! I was floored! I'll work that price when I'm doing sub work for other sign companies, but that's when they supply all materials and the design! This was not the case!
I see your problem. It's your math. 3 days work divided into $2400 is indeed $800 a day. But you just stated that you had to pay for materials, (2 sheets of hdu) and the mounting template, and the price included installation, (was this magnetic HDU or am I to assume that there is more hardware to buy, fabricate, attach, etc.)
Plus it sounds like you already practically gave away your design time because you're only getting $500 for 11 designs plus fabricating 2 mounting templates and their costs.
You did the right thing by not dropping your price. Others have said it, you'd telling him you were going to gouge him with the original price (even though you weren't really)if you would have met the low baller. Years ago I took a very high powered sales training seminar. They taught me this on the subject of cutting price: When you cut price for any reason (other than cutting back on features) you will never have a satisfied customer. They are always going to wonder if they held out a little longer that the price might be even lower.
And again, you're complaining about him, and now you're ready to match him. That's the attitude that is causing this reduction in prices. It happened with vinyl, it happened with digital prints, now it's starting to happen with routers.
quote:Originally posted by Mark Tucker: I call it "CNC Proliferation"
And by meeting this guys low balling price, you're helping to perpetuate the problem.
Posted by Ray Rheaume (Member # 3794) on :
Mark,
You made the decision, correct? Rehashing the "800/day" aspect past that decision makes me think that you're now looking for someone to come here and justify changing your mind again.
I said it on the phone, and now I'll say it on this forum...
When you post something seeking advice, you will get some good, and occasionally, bad advice, but that's all it is. At the end of the day, the decision is still your's and your's alone to make in regards to what you will do.
One point I think needs to made... Whether or not your router is running is a moot point. My airbrush equipment doesn't get used every day, nor do my brushes. But that doesn't mean when they are being used that I'm 'LOSING MONEY" but not having my cutter whizzing away.
What do consider "billable hours"? I may be out here the shop up to 60 hours during the course of the week, but it's not all billable. Bookkeeping, returning phone calls, maintaining equipment, ordering supplies, sweeping up the floor, shooting out to the hardware store for some foam brushes because I ran out...I probably spend at least 10 hours a week doing things of that nature. Take that into consideration when you figure that $800 amount. You may be surprised at what that comes down to...and how quickly.
And now for the part you know better than to have posted... "I keep forgetting that I'm in the company of millionaires in here, and some of you fine-haired people snub your noses at money like that."
That's not only untrue, but uncalled for. It's only purpose for even being said was to be combative. I thought you were better than that. Rapid
[ June 29, 2007, 04:20 PM: Message edited by: Ray Rheaume ]
Posted by Si Allen (Member # 420) on :
Welllllllllllllllllllll...I don't know about millionares in Georgia....but....here in So. California, this is the typical storage area of an average sign shop!
Posted by Janette Balogh (Member # 192) on :
Dave, I gave up on this argument with Mark long ago. Posted by Mark Tucker (Member # 6461) on :
Well hold everything, everybody! Get a load of this: The customer called me back today and wanted to come by and give me my check for $500.00. I says; "Why don't you just mail it?" He says; "I need to show you something because I have a question for you." He gets here this afternoon with the check and a color picture/print of a flower, very detailed, and ask me; "Mark, this is what we've decided on for our logo for the signs. It obviously needs to be hand-painted. Can you do it? Because your competition can't." I says; "Sure, I can hand paint that, but I'd have to have more money,... above my original quote of $3,750.00." "How much more?" "$850.00" "Can you still have the signs installed by July 14th?" "Yep". "So, $4,600.00 total?" "Yep." "Can I write you a check for half of that now?" "Yep." He did so, we shook hands, and he left. All's well that ends well, folks! $72.00 a sq. ft.,...very decent for these parts! And painting the flowers? No big deal. Easy money! It'll be fun to whip out my brushes. Haven't seen them fer a while!
Now, to try and clear a few things up: I don't see where I was being combative, Rapid, and I'm sorry you took it that way. $800.00 a day is still damn good money in my book. My philosophy is that if I can't make a dollar, I'll go make 50 cents. I installed 14 double post signs in the ground at a church yesterday for a local sticky shop. I worked my ASS off in the hot sweltering sun for 6 hours to git 'er done, but I made $700.00. All things considered, I'd rather make $800.00 a day letting my ShopBot do most of the HARD work, but I'm glad I didn't lower my price! Look what happened!
A lot of folks in here criticize me for how I work and do business. Let me just say this: Other than my mortgage, I am debt-free. Everything I own, including my shop, my ShopBot, my truck, all of my equipment, everything, is bought and paid for. I have no credit debt and I have plenty of money in the bank. I got where I am by making signs the way I do and doing business how I do it. What's wrong with that?
One more thing: About the design time I had in with this customer,...yes, I did 11 different designs, but they were all variations of the same oval theme, mostly just different letter styles. I have a computer. I have SignLab. A few clicks of the mouse and "boom", there's another variation. I had maybe 2 hours in the whole thing. No big deal. It was easy! Posted by Dave Sherby (Member # 698) on :
Nettie, you're right. Mark likes to stir the pot and watch it cook. This isn't the only board he does this on. It's not worth my time. Posted by Mark Tucker (Member # 6461) on :
I don't post on any other boards lately, Dave. What boards
I'm not out to "stir the pot". BTW, how much is your time worth, exactly?
Posted by Joe Crumley (Member # 2307) on :
Good for you Mark.
You Winn.
Lets close this post.
Posted by Curtis hammond (Member # 2170) on :
quote: Everything I own, including my shop, my ShopBot, my truck, all of my equipment, everything, is bought and paid for. I have no
All the more reason to charge more,, you have no excuses to discount anything any more. You have no price fear.. Gouge em until you smirk..
Posted by Mark Tucker (Member # 6461) on :
quote:Originally posted by Joe Crumley: Good for you Mark.
You Winn.
Lets close this post.
I agree, Joe. I don't agree that I "won" anything, but I agree,...post closed. Thanks, man.
[ June 29, 2007, 10:04 PM: Message edited by: Mark Tucker ]
Posted by Si Allen (Member # 420) on :
Glad ya didn't give in and go with the lower price....holding out paid off!
It goes back to the old saying :
"If you get more than 50% of your bids, you are not charging enough!"
[ June 29, 2007, 10:47 PM: Message edited by: Si Allen ]
Posted by Jon Jantz (Member # 6137) on :
Congrats, Mark. All's well that ends well.
(Geez, now you went and proved the old-guys right, and we'll never hear the end of it.... see if I ever stick up for YOU again!! )
Posted by Mark Tucker (Member # 6461) on :
The old guys are pretty damn good, Jon. That's one reason I'm active in here. Thanks for taking my back, friend. I owe you one! (Come to think of it, I owe you two or three.)
[ June 30, 2007, 01:21 AM: Message edited by: Mark Tucker ]
![[Mad]](mad.gif)
Finally, early this Wednesday afternoon, he called and said they had decided on this design for the two 4' x 8' routed oval signs: (Click on pic to enlarge.)![[Smile]](smile.gif)
![[I Don t Know]](graemlins/dunno.gif)
![[Eek!]](eek.gif)
![[Frown]](frown.gif)
Maybe I'm just being greedy...I mean, I want to cover the costs and make a little money to cover my time, equipment, power, and mortgage... ![[Confused]](confused.gif)
![[Wink]](wink.gif)
![[Rolling On The Floor]](graemlins/rolf.gif)
