Digitizer Advice

Gilligan

You do realize YOU are that guy that will move on because he finds someone that is a buck cheaper.

Not everyone works that way... lots of people stick with quality first.

nametags

We'll just have to wait and see, won't we Gilligan. Time will tell. But, I do hope that YOU make it. I don't move on because it's a buck cheaper, I haven't yet. Its about being treated fair and consistent by those you deal with, that's what this is all about.

It seems you've got more irons in this fire than me. You have a computer repair and consulting business, which sounds like two distinct and very time consuming jobs requiring a lot of "hands on" dedication, based on the shops like that in my area, and now it appears an embroidery business too. Not sure what else you do, T shirts, promos, etc. You didn't mention if you have employees or not. I can only imagine your overhead if you do. If so, that is an even bigger headache in some ways. If it came down to it, which would you concentrate more effort and time too if you had to choose, computers, or embroidery? If you run them all yourself, that may come up some day.

For us, this is a side job preparing for retirement soon, just us two working our way through. We're liquid, no debt. We only buy equipment when we can pay for it.

Good luck to you,,,

widners

nametags, we are in the same situation, except the part about retiring . We don't have the overhead of some big retail store, employees, etc. I understand both sides of the pricing discussion but let me put it in perspective. We are given case pricing by several wholesalers, we don't currently order enough to qualify for case pricing from others. Who do you think we are going to purchase from? Who am I more likely to continue to purchasing from if I ever do get big? The wholesalers that don't provide case pricing to the little guy are quite a bit higher per items by the piece. Now, how can I compete, much less stay in business, if I can't even get the garments even close to the same price much less now adding my labor running on 2 heads....

Those suppliers that offer us case pricing and good competitive pricing on services are helping me build my business and be competitive so I can grow. In some cases offering discounts on services to the big guy is likely just lining their pockets as they are still charging the customer the same. Those offering the service just get to work harder for less or be threatened that the business will be moved elsewhere.

I understand, it's all how the business works. Just remember that one day us small guys may be big shops and we are likely to continue doing business with those that helped get us there and helped us be competitive in a time that others only catered to our competitors. I only hope that I can also continue helping all of my small customers and business owners that are like me and only need a few items at a competitive price.

nametags

Our goal is to come up to your level, a couple or 3 machines, more experience. That's what we're shooting for. We're planning on buying a small store front in our town, looking at one now, with a 3 bedroom apt. above it that will rent for the mortgage, and we can move on up. But, we're not ready yet. We have to stick to our plan.

For us, so far, the wholesalers we have contacted concerning opening wholesale pricing accounts, have approved us due to our having the appropriate federal and state tax numbers. The two that didn't at first, did after we joined the NNEP organization. That's not for case pricing, but for individual pricing. For those that offered case pricing, changed to individual pricing after we joined NNEP.

Those vendors that do offer you discounts even though you're a small timer, like you said, are building good will from the start, giving you the discounts up front. They support the small operators. Digitizers need to realize the same thing. Some do, many don't.

Your comment ",,,one day us small guys may be big shops,,," is golden, how true. My whole point exactly.

Gilligan

My only point was you basically said that if a vendor raises prices on you, that you will leave them. Is that regardless of how happy you are with the service? You made it sound like it was.

In my business (computer consulting)... my fees have gone up 50% on my rates... none of my clients have complained. I have a fellow consultant that has raised his prices even higher than mine and none of his clients complained either.

They are just happy with their service.

Widners, if you really do stick with your suppliers that helped you out when you were starting that is a rare trait. Which actually makes me agree with you nametags... Many times once a shop gets bigger if they relook at suppliers and now supplier X that wouldn't give them a break before now can hook them up cheaper than their original supplier they will first try to haggle the original supplier to that price and then if that fails they will start ordering from supplier X to see how they are. If they are satisfied then they will follow the cheaper product and start with supplier X.

Ordering supplies are a lot like ordering digitizing. If you order more then you get a discount.

widners

Except that the suppliers that are currently offering me case pricing are offering me the same case pricing as they would offer the big boys. It is the same case pricing as the other wholesalers are offering. I could see your point if my current suppliers "case pricing" wasn't actually case pricing. The fact of the matter is for me to get a better price I would have to negotiate with all the companies for a price better than case pricing. Currently I have no reason not to stay with them, even if I magically was big tomorrow they are offering the same prices to me now that the others only offer for their big customers. They wouldn't be offering me anything that I don't already have with the company that has been taking care of me and helping me get there!

Gilligan

I meant differences in prices.

I know some wholesalers have plain better prices than others. CLOSE, but pennies add up over 1000's of garments.

One product that I produce is http://www.cajunwineglass.com We recently picked up production and have had a hard time finding the bases locally. We were getting them for 1.08 each. I went to the distributer and can get a pallet of them (1188 pcs) at 1.02 each. 6 cents x 1200 = 72 bucks... and they will be delivered to my shop. That's definitely worth it and it's only a saving of 6 cents a unit. I know I can get them cheaper... but I don't think I'll ever be buying 10k worth which is what the manufacture requires for the initial purchase and then 30k/year after that.

widners

Your right, I will have to investigate that when the time comes. Fact of the matter is a savings over 1188 pieces of $72 I would probably continue with the folks that treated me right over the years. I can't say that for sure right now because I am not in that situation. We all have to evaluate what works for us. I try to offer my customers good pricing and good service even on small orders so they come back to me for the big orders. I would be hypocritical to want my customers to stick with me but I don't do the same with the vendors I purchase from. Then again we are in this to make money so there will probably come a time when the price difference is significant enough that we need to move on.

nametags

Gilligan, why would you stay with a vendor that raised their prices??? Are you glad to give them more money, that you have to charge your clients to get? Seems you're screwing the customer more than anyone!

What if your consulting customers called you and told you that you were underbid for services, would you try to keep them, or let them walk, holding to your pricing?

My first few months in embroidery, I used several digitizers. They raised their prices after around 5 or so designs, touting many reasons I didn't understand then. After a few months, they send me emails offering me the pricing as before, wanting my business back. But I had already replaced them. Why did they drop their prices? My opinion, they lost more business because they couldn't justify their increases, and savvy customers knew this. I wasn't savvy then, but I am more savvy now? Still learning though.

You know, Gilligan, I just realized, you nor I ditgitize, if I read your posts correctly. Yet we're hashing out two different sides of a like situation,,,,I want to save money on digitizing costs, and it looks like you don't mind spending more on them, and we both want quality, service, and fair pricing. Am I reading that correctly?

Gilligan

Yep... at some point you grow to where you realize that doing X job for Y price just won't cut it and you have to learn to let those jobs go. Sometimes you can't afford to DO the job when the bid gets too low. This usually comes with overhead and other things. When your over head is low you can work for whatever works for you... but the problem with working like this is just like what nametags and I are talking about. If your cost go up and you have to increase your prices later then some customers won't like that. If you start out at X price taking into consideration future overhead and growth then you don't have to jack them up.