posted
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.
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
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.
-------------------- Jean Shimp Shimp Sign & Design Co. Jacksonville Beach, Fl Posts: 1269 | From: Jacksonville Beach, Fl. USA | Registered: Nov 1998
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posted
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.
posted
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.
-------------------- Joe Crumley Norman Sign Company 2200 Research Park Blvd. Norman, OK 73069 Posts: 1428 | From: 2200 Research Park Blvd. | Registered: Sep 2001
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posted
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.
-------------------- “Did you ever stop to think, and forget to start again?” -Winnie the Pooh & A.A. Milne
Kelly Thorson Kel-T-Grafix 801 Main St. Holdfast, SK S0G 2H0 ktg@sasktel.net Posts: 5496 | From: Penzance, Saskatchewan | Registered: May 2002
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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?
-------------------- Silver Creek Signworks Dick Bohrer Two Harbors, MN Posts: 236 | From: Two Harbors, MN USA | Registered: Jun 1999
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posted
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
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
-------------------- Silver Creek Signworks Dick Bohrer Two Harbors, MN Posts: 236 | From: Two Harbors, MN USA | Registered: Jun 1999
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posted
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
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 ]
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 ]
-------------------- Si Allen #562 La Mirada, CA. USA
(714) 521-4810
si.allen on Skype
siallen@dslextreme.com
"SignPainters do It with Longer Strokes!"
Never mess with your profile while in a drunken stupor!!!
Brushasaurus on Chat Posts: 8831 | From: La Mirada, CA, USA | Registered: Nov 1998
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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.
posted
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.
-------------------- Rodger MacMunn T.R. MacMunn & Sons C.P.207, Sharbot Lake, ON 613-279-1230 trmac@frontenac.net Posts: 475 | From: Sharbot Lake, Ontario | Registered: Nov 2003
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posted
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..."
-------------------- "Stewey" on chat
"...there are no limits when you aim for perfection..." Jonathan Livingston Seagull Posts: 7014 | From: Highgrove via Toowoomba, Queensland, Australia | Registered: Dec 2002
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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!
-------------------- Joe Crumley Norman Sign Company 2200 Research Park Blvd. Norman, OK 73069 Posts: 1428 | From: 2200 Research Park Blvd. | Registered: Sep 2001
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posted
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.
-------------------- Chapman Sign Studio Temple, Texas chapmanstudio@sbcglobal.net Posts: 6306 | From: Temple, Texas, USA | Registered: Nov 1998
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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.
-------------------- Ricky Jackson Signs Now 614 Russell Parkway Warner Robins, GA (478) 923-7722 signpimp50@hotmail.com
"If I have seen further it is by standing on the shoulders of giants." Sir Issac Newton Posts: 3528 | From: Warner Robins, GA | Registered: Oct 2004
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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.
-------------------- Michael Heaton Brushworks Yelm, Washington 360-339-0914 Posts: 14 | From: Yelm, Washington | Registered: Jun 2007
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posted
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
-------------------- You ever notice how easily accessible people are when they are requiring your services but once they get invoice you can't reach them anymore
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...
-------------------- Mark Kottwitz Kottwitz Graphics Ridgely, MD www.SeeMySignWork.com -------------------------- Imagination is more important than knowledge. -- Albert Einstein Posts: 749 | From: Ridgely, MD | Registered: Oct 2000
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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?
-------------------- Ricky Jackson Signs Now 614 Russell Parkway Warner Robins, GA (478) 923-7722 signpimp50@hotmail.com
"If I have seen further it is by standing on the shoulders of giants." Sir Issac Newton Posts: 3528 | From: Warner Robins, GA | Registered: Oct 2004
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posted
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
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.
-------------------- Chapman Sign Studio Temple, Texas chapmanstudio@sbcglobal.net Posts: 6306 | From: Temple, Texas, USA | Registered: Nov 1998
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-------------------- Jimmy Chatham Chatham Signs 468 stark st Commerce, Ga 30529 Posts: 1766 | From: Commerce, GA, USA | Registered: Nov 1998
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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...
-------------------- Mark Kottwitz Kottwitz Graphics Ridgely, MD www.SeeMySignWork.com -------------------------- Imagination is more important than knowledge. -- Albert Einstein Posts: 749 | From: Ridgely, MD | Registered: Oct 2000
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posted
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.
-------------------- Donald Miner ABCO Wholesale Neon 1168 Red Hill Creek Dobson, NC Posts: 842 | From: North Carolina | Registered: Apr 2006
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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
-------------------- Ray Rheaume Rapidfire Design 543 Brushwood Road North Haverhill, NH 03774 rapidfiredesign@hotmail.com 603-787-6803
I like my paint shaken, not stirred. Posts: 5648 | From: North Haverhill, New Hampshire | Registered: Apr 2003
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posted
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.
-------------------- Deri Russell Wildwood Signs Hanover, Ontario
You're just jealous 'cause the little voices only talk to me. Posts: 1904 | From: Hanover, Ontario, Canada | Registered: Dec 1998
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posted
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.
-------------------- "A wise man concerns himself with the truth, not with what people believe." - Aristotle
Cam Bortz Finest Kind Signs Pondside Iron works 256 S. Broad St. Pawcatuck, Ct. 06379 "Award winning Signs since 1988" Posts: 3051 | From: Pawcatuck,Connecticut USA | Registered: Nov 1998
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posted
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
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.
-------------------- Ricky Jackson Signs Now 614 Russell Parkway Warner Robins, GA (478) 923-7722 signpimp50@hotmail.com
"If I have seen further it is by standing on the shoulders of giants." Sir Issac Newton Posts: 3528 | From: Warner Robins, GA | Registered: Oct 2004
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posted
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.
-------------------- "A wise man concerns himself with the truth, not with what people believe." - Aristotle
Cam Bortz Finest Kind Signs Pondside Iron works 256 S. Broad St. Pawcatuck, Ct. 06379 "Award winning Signs since 1988" Posts: 3051 | From: Pawcatuck,Connecticut USA | Registered: Nov 1998
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Topic Closed
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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.)
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![[I Don t Know]](graemlins/dunno.gif)
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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)
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