There's a rule of thumb in the vinyl graphics business: Retail pricing should be based on the cost of your materials, plus a 30% markup.
That may work for aluminum sign blanks, but if you use that formula for banners, you will cheat yourself and devalue your product. As with all rules, there are exceptions. And pricing in your local marketplace can have an effect at where you set yours.
The value of an installed banner should not be determined by what it cost you to make it, but what it is worth to your customer. Incidentally, the same could be said for magnetic signs, fleet graphics, and many other commonly-produced vinyl graphics.
For banners with spot color vinyl graphics, a better rule of thumb is found in the "Sign Pricing Guide". According to this valuable industry standard, the base price for a 24" wide banner should be $12.50 per linear foot. So a 2' x 6' banner blank should be at least $75.00. "But it only costs me $14.00 in materials," you say. "Isn’t that gouging?" No, that’s charging a fair price for a good product. Your banner may drive thousands of dollars in business to your customer. If you’ve done a good job designing professional signage that will enhance your customer’s image, it’s worth fair market value.
If you're selling digitally-printed banners, the market standard is $8.00 per square foot. You may be tempted to charge less because you don't have to cut and weed multiple colors of vinyl, but the fact that it took you less time to produce the banner has no bearing on its value to the customer. A well-designed, full-color banner has more value because its graphic impact can do more to drive retail traffic and enhance awareness for your customer. The fact that it can incorporate full color graphics means you can also design it to reinforce your customer's other advertising campaigns (including web, television, and outdoor advertising), thus increasing potential R.O.I. on all of their marketing dollars.
Speaking of design, you should charge a design fee whenever possible. If your customer goes to a graphic design company, they'll have to pay for that work. The same service shouldn't be free at your sign shop. Rates in your market may vary, but an hourly rate of $25 or more, or a flat fee of $75, should be the minimum. Many designers charge upwards of $600 to $800.
Of course, what you charge is highly dependent on market pricing by others in your geographic area. Don't forget to shop the competition and found out the going price. But don't let that dictate your pricing. Many sign shops have no idea of their costs; and will eventually go out of business.
Conventional wisdom says that sign businesses can prosper even in a down economy because businesses struggling for sales have to be more aggressive. So in challenging times like these, your installed banners are more valuable than ever. Don't sell them too cheaply.