Here's a phenomenom I've noticed before, and had an opportunity to test this past week. A client who owns a restaurant ordered three signs; a single-faced carved sign with a simple logo (no design time on my part)32"x36" oval, and two small MDO with SignGold signs, 6"x36", reading Lunch and Dinner, respectively. I sold the carved sign for $1000 and the two small signs for $150 each, plus dinner for two (it's one of my favorite "nice" restaurants, and that's worth about $100.) The carved sign was no problem - 1" SignFoam, about an hour and a half carving, an hour to paint, an hour to size and gild, just under a book of patent leaf - costing it out, the job cost about $350 in labor and materials. Not bad. What was annoying is that the two "small" signs took JUST as long to make - cutting/sanding/priming/coating the MDO, cutting/weeding the Signgold, outlining the lettering with a brush, etc. - if not longer! My only savings were on material costs, at about $15 for MDO vs $75 for 32"x36" in signfoam. If I haven't lost you by now, you see the problem. The two "small" signs end up costing almost as much as the "big" sign, but the selling price is less than 1/3, which drags down the profit margin on the whole job. The obvious answer is "raise the prices" on the small signs, but that's the toughest of tough sells - the perceived value of the "small" non-carved signs is way less, to the client, than the "big" carved sign. Another point I should make is that this client is a classic "Haggler" (see last weeks post on customer types). He's not cheap, not afraid to spend money, but always makes a counter-offer on my price (which is how I ended up with dinner for two thrown in!) Please understand - I'm not complaining about this job. I'm just looking for insight on how other folks handle the issue of "small" signs that eat up as much time as "big" signs, but end up not making you nearly as much money.
------------------ "A wise man concerns himself with the truth, not with what people believe." - Aristotle
When the going gets weird, the weird turn pro. - Raoul Duke (Hunter S. Thompson)
Cam Finest Kind Signs 256 S. Broad St. Pawcatuck, Ct. 06379 "Award winning Signs since 1988"
Posted by David Wright (Member # 111) on :
I am not really sure there is a good solution to this. How many people will price a 4'by 8' sign at one price and go half for a 4' by 4'. They take almost as much time to letter both with obviously a little less for the smaller one. Even most of the pricing guides will show this.
You talk about tracking your time when you did these, which I believe most sign people never do. They might not like to make the changes necessary to accomodate the new information.
Other than selling "big", adjusting prices on the smaller signs with a ready explanation is all you can do.
A similar problem when selling a banner as opposed to an alumalite sign. Same size but the banner has less percieved value. That's why I don't sell many banners.
------------------ Wright Signs Wyandotte, Michigan Since 1978 www.wrightsigns.outputto.com All change isn't progress, and all progress isn't forward.
Posted by Chuck Peterson (Member # 70) on :
I have also run into the opposite situation. If I have the small sign priced right, and they want some larger ones, too, I end up making tremendous profit on the larger ones if I'm charging using size not just time as a basis for price.
Not exactly the same thing, but I almost prefer a really big window job compared to a small window. I can knock out a 40+ ft window in a couple of hours, charge them a lot and walk away happy. Then there is the customer that says "I only have a tiny window, are you going to charge me the same minimum for that?, it's really small..." Heck, yeah! I hate trying to fit all that copy (and it's always a ton of copy)into a tiny window (nail shops,....horrors!) I know that one will take more time than the big window did.
It looks to me as though you did fine for the small ones, and did really well on that big carved one, Cam! More of a matter of the way you look at it I think.
A
------------------ Adrienne Morgan Splash Signs "Wherever you go...there you are!" www.splashsigns.com "Rainkatt'on chat
I used to have to provide one of my big companies with a price list on signs. We devised a copy density formula by individually counting up various signs then figuring the value of them. The only problem with that in your case is your work is not all the same type work. As mine was all screen printing, it was pretty easy to do. I think you did well in any case, Sometimes it is still just a seat of the pants thing that will average out in the end, we hope LOL Bill
------------------ Bill & Barbara Biggs Art's Sign Service, Inc. Clute, Texas, USA Home of The Great Texas Mosquito Festival Proud Third year Supporter of the Letterheads Website "MrBill-" on the chat page MailTo:bill@artssigns.com
Posted by Cam Bortz (Member # 55) on :
Thanks for the replies. As I said, I'm not complaining about "how I did" money-wise. But the fact is that even though my customers expect to pay fairly high prices for my work, it's much more difficult to make the same margin on small, secondary signs as a larger ID sign. Consequently I don't seek out the small, run-of-the-mill "info" signs, as I make a lot more on larger "advertising" signs. In this case, the job started with the client asking for two small carved signs (the LUNCH/DINNER signs). I quoted those at $300 each, which made him balk, so I halved the price to do them without carving. A discussion then followed about his new logo, which I said would look great carved, and he ended up ordering the carved sign at $1000 and the two smaller signs at $150 each. Here's a PERFECT textbook example of perceived value - to this client, a carved sign with his logo was worth over THREE TIMES what I would have charged to carve a sign saying DINNER. The work involved in the DINNER sign was as much as the sign with his logo, but to him, it was perceived as NOT being worth even 1/3 the price! This is also why I rant against selling signs on a cost-plus basis; by not taking perceived value into the equation, it leaves money on the table.
------------------ "A wise man concerns himself with the truth, not with what people believe." - Aristotle
When the going gets weird, the weird turn pro. - Raoul Duke (Hunter S. Thompson)
Cam Finest Kind Signs 256 S. Broad St. Pawcatuck, Ct. 06379 "Award winning Signs since 1988"
Posted by Dave Draper (Member # 102) on :
Cam,
I don't have to tell you that many businesses have what are called "loss leaders." For instance, to get customers into the supermarket, the price of a 24 pack of Coke or Pepsi is dropped to $4.99...which is below the store cost, and they loose money on the soda, but gain it back in other sales.
The big shop I did work for also did this. They made the big money on certain projects, but on other jobs the selling price of the small signs paid for materials and my wages, just so I could keep busy and they didn't have to lay me off.
If you charged by the square foot, you would lose money also as one sign would have 20 words on it and another sign the same size would have 2 words on it.
There is no way to figure prices compared to other jobs and keep everything even, except for the one way every customer balks at: time and materials.
The customer always balks at this because the craftsman can not give them a price up front, or if he does will have to change it later. This causes friction and a loss of trust.
Many old craftsmen gave me this advice: "Just stay busy and things will work out alright!"
I think what they ment by "staying busy" was to keep the price quotes low when work was slow and raise them on other jobs.
You don't have to tell me I've strayed way off the subject here. But I haven't really. If the was a way to price our work consistantly, don't you think it would be old news? A standard would have been set years ago, and in all the years I have been in the sign business, I have never seen anyone come to a perfect solution to your question.
------------------ Draper The Signmaker Bloomington Illinois USA
Get To A Letterhead Meet This Summer! See you there! DUCK SOUP SPLATTER JAM Sept. 14,15,16 Somewhere in Alabama -------------------- 309-828-7110 drapersigns@hotmail.com Draper_Dave on mIRC chat
Posted by Brad Farha (Member # 931) on :
I usually get a little beat up on the small signs for the reasons mentioned, but make sure that I still make my hourly labor rate - I just lose out on the profit that I normally get for a decent job. But these things tend to even out in the long run. I just try to avoid the customers who make a practice of ordering small "non-profit" work!
i sorta got this under control i think....i price by the s.f. so anything i paint onto a surface starts at $4 s.f if its bigger then 4' x 4'. for vinyl its $5-6. now for smaller signs anything under 4'x 4'...the price per s.f goes up..say 3'x4' in vinyl will be min $6...$72....same for paint or vinyl here...2'x3' @ $7 = $42...so this small stuff will stay in the money makin range of your minimun shop prices...all though last week i priced a 2'x 2' @ $20 each, and are on .040 alum..but i gota do 20 of em...white alpha like A,B,C,D and black b/g....so total out at $400....think ill make a buck here.
------------------ joe pribish-A SIGN MINT 2811 longleaf Dr. pensacola, fl 32526 850-944-5060 BEWARE THE TRUTH.....YOU MAY NOT LIKE WHAT YOU FIND
Posted by Ken Henry (Member # 598) on :
Hi Cam. This phenomenon of smaller signs often costing more to make is one that's been around for a long time. One possible solution is when you've encountered such a project, is to use as much pre-made material as possible. There are, for instance, pre-moulded blanks with nice ornate relief borders (Carravagio) and others. These don't cost an awful lot, but come ready-to-paint, guild, etc. They do eliminate a lot of the prep time that you'd normally spend if starting from scratch.
The end result is that your customer gets a smaller sign that LOOKS like you've put a lot of time & attention into. You GAIN the preceived value, and can get more for them, while significantly reducing the time required to produce them. It might pay to investigate what's available, make up a few samples for your showroom area, and sell these as a more profitable alternative.
Hope this suggestion helps.
------------------ Ken Henry Henry & Henry Signs London, Ontario Canada (519) 439-1881 e-mail kjmlhenry@home.
Some days you get to be the dog....other days, you get to be the fire hydrant.
Posted by Cam Bortz (Member # 55) on :
Ken, I use a number of blanks for small signs, especially house signs, usually from Super Stock Signs, and they are invaluable for the times when they are appropriate. So often though, I find myself needing something in a particular size or shape, and using a pre-made blank feels like hammering a square peg into a round hole.
And no offense, but I'm afraid you lost me there, Joe...if I priced the small signs (one and one-half square foot each) at $6 per sf, I'd have sold them for nine dollars apiece...even if I went to the astronomical sum of $10 a square foot, they'd only have sold for $15 each...one of us has buggered up the math here buddy...and as my price was $150 each, which comes to $100 per square foot, I don't think it was me...
------------------ "A wise man concerns himself with the truth, not with what people believe." - Aristotle
When the going gets weird, the weird turn pro. - Raoul Duke (Hunter S. Thompson)
Cam Finest Kind Signs 256 S. Broad St. Pawcatuck, Ct. 06379 "Award winning Signs since 1988"
[This message has been edited by Cam Bortz (edited September 09, 2001).]
Posted by old paint (Member # 549) on :
cam..sorry...i was usein example of plain simple signs,and my math was for those only...on the carved /blasted sign just add more dollars per sq.ft. for the smaller ones so you still make decent money...sorta like with air brush work in this town(got an air brusher in every wal-mart)i dont do much, but set a minimum of $150...before i even will do any airbrush work...not when these guys at wall mart are doin most stuff for $12-20.....
------------------ joe pribish-A SIGN MINT 2811 longleaf Dr. pensacola, fl 32526 850-944-5060 BEWARE THE TRUTH.....YOU MAY NOT LIKE WHAT YOU FIND
Posted by Rick Heine (Member # 2236) on :
For my vinyl jobs, I charge by the square inch, estimate the design time, and charge for the final substrate. I have a couple of tiers so the small jobs aren't cheap, and the bigger jobs aren't over the top. Puts some objectivity into the price.
------------------ Rick Heine WebLevel Marketing 1939 NE Lakeshore Dr Lees Summit, MO 64086
Posted by Cam Bortz (Member # 55) on :
Joe...You work at Wal-mart now?????
[ September 11, 2001: Message edited by: Cam Bortz ]
Posted by Linda Silver Eagle (Member # 274) on :
Cam,
How about stating a "minimal order price" with these types of signs...including, but not limited to covering your butt on all that goes into producing these babies. If they balk, oh well, let someone else do em for blood, sweat and tears. Tell em yer in this for the money and remind em yer not in a Santa Claus suit.
Posted by Cam Bortz (Member # 55) on :
Why do I feel like after a while people stop reading the initial post and just respond to the responses? Sheesh!!
