Let's face it, we are all in this
business to make money, but how much should we make? How is
your pricing based? Are you a franchise with computer programs
spiting out numbers, are you a business man who uses balance sheets to
figure out labor burden pricing or are you the guy with all the artistic
talent in the world who needs an extra $50 for rent this month.
It shouldn't matter what guy you are. You need to set up pricing,
competitive pricing and stick by it. When I say competitive, I don't
care if you are the most expensive - if you offer your customers more than
your competition, you deserve to be paid more. This article is
designed to show you your hard costs, whether you are a franchisee or work
alone, use the information provided in this article to verify your costs
versus your pricing.
First thing is first, set up a chart listing each substrate.
Yes I know it's a pain, but do it anyway. Follow the instructions
below. I can't give you specific mark ups because that's coercion
and is against the law. Find out what your competitors are charging
- yes have your mom call for you. Make sure you are in the ball
park.
1. Cost of material per square foot (multiply height by length
of material in inches and divide by 144) Include delivery or
shipping charges. Divide price of material by square footage.
This will give you your square footage pricing.
2. Cost of your graphics application (vinyl + application
tape, estimated paint used or ink used) Use same formula as above. Again,
include delivery or shipping charges.
3. Add numbers 1 and 2 together and multiply times your material
mark up - 30%, 40%, 50%, 60% etc.
4. Now you need a shop rate - based per hour. I suggest you
break shop time up by 15 minute intervals. Multiply your shop rate
time by the time it took you to produce your sign. (Leave out the
coffee break)
5. This is what your sign is worth. Now keep in mind that it
may seem high, but you need to pay for the essentials, electric, gas, heat
and rent - oh, did I forget payroll?
When asked pick 2 out of 3 - most consumers choose quality and service
over price. This applies to the sign industry. You have
talent, don't give it away.
If you would like - e-mail me at info@signhunter.com and let me know if
this article was helpful.
Christopher Flejtuch
Signhunter.com
