Need A Honest Answer

printit · April 26th, 2011, 01:56 AM

a customer of mine does screen printing and subs out a lot of embrodery wants to know in volume runs what is a realist cost to produce per thousand stiches nothing fancy just strait forward easy embrodery, he know what he pays but is considering buying some used equipment and doing it him self please help
thanks in advance

Jaeb · April 26th, 2011, 02:07 AM

That's almost like asking what kind of gas milage will I get in my car. What kind of car ? What year? Are you running super or regular unleaded. An average: With a exp operator figure 500 stitches per min on 1 sewing head this is taking in acount trimming color changes, hooping etc counting shirts thread changes.. Items still need to be cleaned backings cut boxed counted etc...invoicing .. Hard work good luck

nametags · April 26th, 2011, 07:53 AM

A good offer, but, give him YOUR price, not one he wants. This has already come up in our new business. He' want's a deal, and for you to think you'll do it for cost or barely a markup, or even a loss, to get his business. I learned a hard lesson in this type of situation. Luckily, it didn't last long. I didn't lose on the deal, but, I didn't make much either. Here's some of my suggestions.

1. Make him show you what HE pays, put it back on him.

2. Don't do it for less than $1 per K, depending on what it is and how much time is involved for you.

3. Do you have to pick and deliver the items, how far is the drive.

4. When do you get paid, on delivery, or after his customer pays him.

5. If it's simple embroidery, do you charge an "art fee". Make sure you find out. As I had my issue with the person charging the customer charging them a $20 set up art fee, and I had agreed to a $10 fee. My mistake, should've checked, but didn't.

If he's that busy and has that big a volume, I don't see him spending $5k or up to do this himself. He'll probably have to hire or "convince" someone to do it for him, which when you add his investment in the equip plus the labor, it'll cost him more than letting you do it.

I'm guessing the straight forward easy embroidery is mostly text. Any basic designs you can get from one of the many on line design sites. Remember the "art and set up fee" issue.

I know you want business, but, don't put yourself in a losing situation concerning your business.

Good luck.

printit · April 26th, 2011, 09:40 AM

Maybe I did not explane it well, I am not going to be doing any embrodery, he wants to buy multyple 18 head units and do volume embrodery simple designs like LAKE SHASTA with a simple little logo in the middle aprox 10 wide 1.5 - inches tall 3-5 colors easy thing like that what is the realistic cost to do things like that per thousand stiches cost being him doing it with his machines his people etc not sending it out he wants to compare what he is paying to what it actually cost to see if its even cost effective

thanks in advance

jacosandy · April 26th, 2011, 11:59 AM

First of all he has the cost of the machine. Then he will have the electric bill for said machine, an operator. Software. Cost of thread, backings. Then break down cost. I would say have the man do his research. He needs a lot of jobs to support an 18 head machine. Not sure the Lake Shasta area can support that type of business, if it was the bay area yes. Everyone wants embroidery cheap and have no idea what is involved they think its just some threads not taking into account our cost for products. I see most places are now charging $1.50 per item a set up fee and artwork cost.

nametags · April 26th, 2011, 12:03 PM

OK,,,,,,,I see.
In my opinioin, and my limited experience in this business so far, so buy those type of machines, he will have to do a huge amount of buisness to pay for that big of a machine. What do they cost used, $20K and up? Plus someone to run them, and then maintenance or headaches on used machines.

He would be better off offering 15 or 20 small timers, like me and a few others on here, a sub contract to do so many and then ship them out to him or to customers.

He could pay $10 for the logo one time,,,,and send the embroidery file to his sub contractors (subs).
HE then buy the shirts from his supplier, and have 25 sent to each subcontractor by blind ship.
The sub's sew them up, and boxes them for shipment. He buys the boxes too.
The subs sends them to where he wants them using his UPS or FedEx account number, and he pays shipping to where he wants them. IF he want's a certain amount of sizes or colors sent, that's fine, the sub sends what he wants to where he wants.

He pays the subs at the end of the month. Or,,,,,,,to start out,,,,he may have to pay the subs by paypal before they ship them,,,,,it's all a trust and/or contract thing. Everyone will worry about if they'll get screwed,,,,,can't blame them, but, this is a business, and you have to take chances sometimes.

If the logo was 15k stitches, and I charged him $15 a shirt, knowing I would get 50 to 75 shirts a month, and he paid all the external expenses,,,,,,I'd do that. Many would. He's not touching anything. I would be receiving them, sorting, hooping, sewing, etc. like JAEB above said, hard work it would be. But, for newbies like me needing to get started, I would do it fow awhile. If it got to big,,,,then pass on it after awhile.

For him to put out $20,000 up front, pay a person a salary to set up and run the machine, and so on himself,,,,would he really be saving/making money for himself.

If I'm off base on this line of thinking,,,,sorry, but, it seems worthwhile.

Just my opinion.

DASWholesale · May 25th, 2011, 01:08 PM

Any good contract embroidery shop will sew for 15 cents a thousand all day long for quantity of 25 dozen and up per design of 6000 stitches and up. Check out 5B's website. They will sew for LESS than that. When my shop was running 24/7, I figured out my cost was about 8 cents. I actually made money on large runs at 12 cents. no lie.

xxyybeth · May 26th, 2011, 02:59 AM

Quote:

Originally Posted by printit

a customer of mine does screen printing and subs out a lot of embrodery wants to know in volume runs what is a realist cost to produce per thousand stiches nothing fancy just strait forward easy embrodery, he know what he pays but is considering buying some used equipment and doing it him self please help
thanks in advance

If your Customer is not your Family or Close Friend and plans on conducting their embroidery business in your Geographic Area, encourage them to Go-For-It.
(Internet is heavy competitor these days, can't get away from that, but another Store Front in same neighborhood could/may hurt your business).

In my opinion, Skill/knowledge/Time Required to produce quality embroidery is Ten-Fold + compared to Screen Print :-)

If the Screen Printer isn't experienced in embroidery industry, they'll probably call you constantly for advise, after all, you got rich quick from all their orders, you owe them............GIVE NONE!

Politely inform them you do not desire to jepardize your business relationship with them and that you feel it's in both your best interest to no longer discuss embrodiery. If you need to get blunt, tell them their questions cost you money, distracts you from your work, time is money, excuse yourself, you have a customer waiting.

I personally wouldn't give pricing info to a competitor either. I'd tell them you price out each order based on quantity, time, no flat rate. Tell them each company has different overhead costs, have them contact their accountant for theirs. Cost plus hourly wage, divide by total product produced per hour, confuse the stuff out of em.....be vauge, use that 5B's pricing, that will put them out of the embroidery business in no time:-)

If competitor is persistant calling for advice refer to their manuals or machine/software support. Reinforce you don't want to ruin your business relationship. Explain how difficult it was for you in the beginning, what could go wrong did, and that if things go wrong they may think you're trying to sabatouge their new business and you just don't want to be in that position. Cry right back At-Em!

If you're not a digitizer, don't devulge your Skilled Source, only undesirable sources. Give them the ones that solicit via email, usually they offer one free design. ones that do not do machine test sew outs, have the nerve to send you garbage, let you waste your time finding all their design errors / issues, or don't know how to follow written instructions in Spec's, they waste your time to make you request edits because they don't know how to follow instructions or poor digitizing skill, you wait for edits, test sew again, only to find design worse than first time, etc. etc. Yep, give that contact info out:-) to competitor who thinks you get rich.

Your Competitor's Poor workmanship will drive business to your door, reap the rewards.

Don't forget to refer One Off's and/or labor intense not cost effective, next to free work, as often as you can.

Keep on goodt terms!

Sit back and laugh your hindy off while you visulize them embroidering a full jacket back-complex design, 2-3 hours each compared to Screen Print production only minutes. Yep, let them Get Rich Quick, more power to them.

In the mean time, Start Stashing cash, within 6 months to 2 years make them a Best Offer on the Embroidery Equipment, you'll probably get a great deal on like new, barely used equipment.

Robert Young · May 26th, 2011, 09:21 AM

Quote:

Originally Posted by DASWholesale

Any good contract embroidery shop will sew for 15 cents a thousand all day long for quantity of 25 dozen and up per design of 6000 stitches and up. Check out 5B's website. They will sew for LESS than that. When my shop was running 24/7, I figured out my cost was about 8 cents. I actually made money on large runs at 12 cents. no lie.

ah, so if you have an 18 head... and a 2000 pc order with 7000 stitches... it will take you 111 runs. if your cost is 8 cents per thousand to run this, then it costs you 56 cents per pc to produce... but you are only charging 12 cents or 84 cents total per pc... then you are making a profit of 28 cents per item... or a total profit on the 2000 pc order of $560 dollars..... but 111 runs on an 18 head will take you 15.50 minutes per run at a total spm of 450 (this is high, most shops only average about 350spm when you count thread breaks, loading and unloading machine etc.. .actual stitches per minute is way less than what you actually set on your machine)
so 15.5 minutes per run at 111 runs is 28.68 HOURS of machine time.... so your $560 in profit works out to $19.53 per hour. Really? you were ok with an 18 head making only that per hour for you?? now it gets worse if you have less than an 18 head.

DASWholesale · May 26th, 2011, 10:07 AM

The simple answer is that MY COSTS were averaged over a gamut of machines, and the two 18 head machines that Hirsch gave me to try NEVER ran as well as 15 or 12 head equipment. The 12 head stretch bridge machines I had would run at 750 spm as long as they has bobbin thread, and over a total of over 250 heads, 8 cents was cost. We ran 24/7, so running 8 hours would push cost to 13 cents. We kept machinery once it went "off lease", but still a full 60% of the machinery was still cost of lease accrual bound. The rest is even more complicated. I won't get into a ****ing contest with you about this stuff. 15 cents was fine.