One of the most important and often asked questions from new sign makers is how do I get my retail sign pricing right? What do I charge? No other question has such potential for success or failure for a new business. No matter how well you know your equipment, no matter how good your designs are, if you fail in pricing signs right, you fail; period. So in the interest of increasing your chances for sign making success, we offer this beginners guide to sign pricing. We’ll look at industry standard pricing for the most common applications, guidelines for design and labor charges, resources for managing costs, and tips for adapting to regional differences. Let’s start with some basic guidelines for banners, vehicle graphics, and small signage.
BannersYou can decorate banners with a digital printer or a basic vinyl cutter, so anyone with sign making equipment has a chance to play in this market. That's one reason banners are a staple of the digital graphics industry and account for the lion’s share of most sign business sales. So it’s important to get this one right. For some kinds of signs, you can base your quotes on material and labor costs, then add your desired margin. For industry staples like banners, that’s probably going to lead to your quotes being too low. The standard for digitally printed banners is $8.00/sq foot. So you could price a printed 3’ x 6’ banner at $144.00. For a simple, one color banner in “cut vinyl”, you can price it more economically, in the $5.00 - $8.00/sf range, then add a little more for two or three color designs. Speaking of design, be sure to add a design fee if your customer is starting from scratch and you have to create the layout. That is in fact the most important aspect of the product. More on that later.
When quoting vehicle wraps, it’s important to realize that, due to the degree of difficulty, this is a category that often gets compartmentalized. In other words, not everyone who sells wraps actually installs them. So if you’re competing for a wrap job and the other quote seems low, make sure you’re comparing apples to apples. The competitor may only be quoting installation. Some shops do the full project, from design to installation, but many do only the design work, or only install wraps that are designed and printed elsewhere. If you want to start installing, but don’t have much design experience, you can outsource the design and printing to a local sign shop. Conversely, if you’d like to design and sell wraps, but don’t want the challenge of installing them correctly, you can pay an experienced installer up to $800 per vehicle and pocket the difference. However you decide to slice it, here are the current norms. The industry average for an installed vehicle wrap is $10.00/sf. This includes the use of two mil cast vinyl and over laminate film. For most vehicles, that’s going to put you somewhere around $2,500 - 3,500.00. If your customer needs to start with a clean sheet of paper so to speak, you may need to charge extra for design. The standard fee is $250.00 for a simple design featuring customer’s existing logo. If they want you to create a logo as well, charge extra. Graphic design studios make big money on logo design. But again, be aware of the prevailing practices in your area. Some shops include the design fee in the installed price of the wrap.
Do your homework and set your prices accordingly. If a competitors’ quote seems too low, check the details. What materials are they using? Cast or calendared vinyl? A flat-sided vehicle like a trailer can be wrapped with a premium calendared film like PrismJET 230 Ultra or ORAJET 3551RA. Vehicles with compound curves should be wrapped in cast vinyl, which costs approximately 20 to 30% more.
Does the competitor’s quote include lamination? Some sign shops sell car wraps without lamination. That’s not the industry standard since it exposes the printed vinyl to detergents and abrasion, resulting in shorter service life. If that’s the case, point that out to your customer and make sure he or she knows the difference in quality. Speaking of competition, there are two very good reasons to get to know what other sign makers around you are doing. If most established sign folks in your area are charging $10.00/square foot, don’t come in at $5.00 just to get business. You’ll undercut your potential revenue growth and alienate the sign community. That second part is more important than you might think. Yes, the other shops are your competitors, but there is also a fair amount of networking and referral in the sign industry. You want to grow to become a member of that network. Starting by undercutting everyone in town isn’t the right way to go about it.
Sign Making Labor & MaterialsFor less popular signage for which isn’t a standard charge, you’ll have to come up with your own price list or devise a quote based on time and materials.
- Labor: Remember to add a labor charge to compensate you for your time and or that of your staff. Charge for time taken to cut the vinyl, weed it, mask it, etc. The industry average is $60-$70.00/hour, depending on location. It should be higher if you have employees, since you’ll have to cover the cost of their hourly wages plus 50% more for unemployment insurance and other benefits. As good a manager as you are, you probably won’t keep them busy all the time. Build in some margin here. If you’re a one man shop, you’ll have more wiggle room here on your hourly rates, but you should be willing to pay yourself what you’re worth, considering the amount of time you’re investing in your business.
- Materials: As noted in the section on vehicle wraps and banners, the formula for material cost is based on the area of the sign or substrate measured in square feet. If you’re quoting a vinyl graphic, remember that you should base this on the size of the substrate, not the size of the letters. This accounts for the amount of vinyl wasted by weeding and the amount of transfer tape used. So, for a double-sided 2’ x 3’ A-frame sign, compute the cost of 12 square feet of vinyl (or six linear feet of a 24” wide roll), plus the same amount of application tape.
Sign Pricing Resources
- SIGNTracker is a great online resource for managing your business. It was developed by an Austin, TX sign shop that grew to be a multi-million dollar business and had to develop their own CRM software to manage it. It includes modules for material cost, sales commissions, production management, scheduling, job quoting and more.
- Your design application may also help manage costs. Depending on the product you use, you may find it contains more than shape and font tools. Top of the line sign software products like Flexi Sign & Print and LXi Master Plus also include features designed to help you manage your costs and customers. Both applications include Job Info and Job Statistics tools. Job Information has fields for storing purchase order numbers, customer contact info, terms, and more. Job Statistics keeps track of vital information like the number of colors used and total editing time. This makes it easier to charge for design time because you can see just how long it took to vectorize that low resolution customer-supplied logo.
And since we’re talking about design, it bears repeating that the single most important factor in getting good prices for your work is good, simple, and effective design. The design tools in your software can support your efforts to deliver the best possible product to your customers. To paraphrase Papa John’s, ‘better design, better signs’. Better signs mean more success for your customers. More successful customers means more repeat business. More repeat business means less pressure to lowball your prices, which means you make more money. Whether you’re using LXi, FlexiSign or some other design platform, a software upgrade can be help lay a strong foundation for a successful sign business. The bottom line is to protect your bottom line.
Pricing your work too low is an easy way to get started, but it can starve growth. If you’re selling but not making money, your success will be short-lived. Pricing too high will of course have the same unhappy effect. Design effective signs, and base your prices not only on what they cost to make, but what they’re worth to the customer. Aim for the sweet spot where you are competitive with the prevailing market rates, and build a network as you grow. It takes some work and patience, but getting this right will set you on the road to long term success. SIGNWarehouse.com