So confused!

sjofn215 · March 30th, 2010, 02:42 PM

I am new at this and so confused....if any one has a simple quick fix it would save my life.
I think I have aged ten years in the last six months over this.

Pricing seems to be the toughest thing for me to tackle. Am I alone in this? I have had so many suggestions but nothing seems to fit the bill...tee hee.
Every time I add it up I seem to be losing $$ that's not the plan here. So what seems to be the best bet so far is to sell our customer service, don't mark up the garment, set the stitch price at $1 per 1000. then add the digitizing fee. I need feedback please!! or is it wrong to ask if there is a simple spread sheet method just between us... embroidery people??

FYI to all....I paid out alot of $$ to have a private trainer come to my office twice for learning the digitizing. It was pretty good the first visit but then when asked them back for a more advanced course it was a repeat of the first. So watch out!

Help I am drowning!

Flint54 · March 31st, 2010, 05:05 PM

You should have a standard markup on your garments/accessories and that should include your shipping costs. ie (Staying simple) 144 shirts/12 dozen cost you $2.50 each and the shipping was $45.00 your per shirt cost would be $2.8125 or $2.82 each. on this shirt your mark up is 500% your shirt would be sold for $14.0625 each. If you were to add $1.00 per 1000 stitches then with a 6500 stitch item on the shirt your price would be $20.50 to the customer.

That is basic dollars & cents. But How much do you need to make per hour of run time on your machine, what is you cost of being open for business? These items are often overlooked in figuring you pricing. How much does your machine cost you per month? What is your rent/lease per month? What are your utilities per month? What is your salary? ETC. You have to add all your expenses up for the month then divide that by the number of hours you are open. Say you monthly cost of being open was $2,100.00 and your are open 5 days a week for 8 hours a day this is 160 hours for the month. Divide your cost 2100 by 160 and you will see that you need to make $13.13 per hour just to break even.

In embroidery getting 45 minutes of run time per hour is usually a good average, this would give you a solid 6 hours of run time a day for the 8 hours you are open

so now your machine needs to be making you more than the $13.13 per hour. This new figure is now $17.50 per hour run time

and this figure goes up with less run time.

On the other hand, what your machine can earn is another story! Always remember when you machine is running it is making you $$ when it sits it costs you not only what your expenses are but the added cost of lost revenue. At a very inexpensive $0.50 per 1000 stitches a single head can produce at least 45,000 stitches per hour, this is $22.50 per hour/or $135.00 per day.

With multiple heads that would be the factor to multiply by, ie a 4 head would be $540.00 per day

IF YOU RUN IT FOR 6 HOURS AT $0.50 PER 1000 STITCHES AND YOU HAVE THE CUSTOMER BASE TO RUN EACH AND EVERY DAY.

This is just a basic figuring, pricing is a science unto itself and has so many factors, you are the one who knows what your monthly costs are, if you don't then you need to find out yesterday and get a hold on your situation. If it takes a couple of days then so be it but bottom line you are in the business to make something from your hard work. Do you know how much it costs you in materials for that last run of 36 shirts you did for the local Lions Club?

You should. Everything you do has an expense to you and that needs to be covered in your pricing, it also gives you a leg up on the customer who gives you grief. You can do it!

I hope that this gives you a bit more to work with..

pkepneriv · October 31st, 2012, 03:55 PM

Flint thanks for the thorough explanation of what someone should be charging for embroidery services. I have been wondering that for awhile.

Thanks,
Paul

BJ24 · October 31st, 2012, 05:52 PM

I hope I can add a few things too.
Some people increase the cost too if there is more colors than what your machine holds since your operator has to stop the machine, tie on new thread etc... Example, if a head holds 9 threads than if more than 9 there is an added fee. Create a pricing sheet that you or your salesmen can present to your customer at the time of order. If a customer see there is more added fees 9 out of 10 times they will be ok with less colors.
If you have rush charge fees add that to your pricelist also because a customer who is breathing down your neck may be ok with waiting a little longer or in the future rethink their timeframe.
Lastly, with my digitizing service I used to charge per the stitch count but my customers said it was easier to have a flat rate so that they would upcharge the fee by $10 so they themselves make $10 off the design which will add up over time and cover costs.
I think the best thing is to figure out your pricing structure factoring how many heads you are running, how long it will run etc...
Here is a tip-for every trim it takes as long as 100 stitches to sew. So, when digitizing if you are doing it yourself-try to limit your trims and color changes as much as possible because it really does slow down the machine. It may not seem much but overtime it can tear into your profit.

Good luck!!!!