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I’ve put my foot down!
I did a regular job for a customer – I was new to the sign business, and worked out a price with little thought about my costs, etc. Attached is a sample of roughly what I was cutting.
I used to get orders from the customer for 50 sets of these stickers, cut from black or white vinyl.
I was using quality vinyl & app tape.
Now for the maths —
50 sets required 5.5 L/M + additional for spoils, set up, re-cuts lets say 7m…
7m of vinyl & app tape was around £2.30 PLM total cost on materials was then £16.10 for the 50 sets.
I was charging the customer £45.00 for the 50.
In my nievety I thought great I am making around 175% profit!
I didn’t account for the time on the plotter – easily an hour
Then my time weed and apply the app tape as around an hour.So for 2hours work I had made £28.90 and my customer had bought the vinyl and app tape at cost from me, and paid me £28.90 for 3hours work…. 😳
I knew my mistake, but was reluctant to do much about it… I then realised this one customer is purely price motivated. No interest in the materials, service, quality (until something goes wrong no doubt)
So in my spur to stop being taken as a mug when the customer asked for another set cutting I submitted a quote.
My logic being – 9 sets per meter (9x 90p) gives me £8.10 PLM including app tape, so that’s my materials reasonably marked up enough to account for wear and tear on the machine + overheads + a wage!
The 50 sets will take an hour to weed… so lets add that odd… not really a skilled job so a lower rate of £25.00.
I put the quote in then for £1.40 per set, a 50p a set increase… well the customers gone ballistic!
I don’t think it is unreasonable? I explained that I cannot run a business not charging for my time, and that I also have a growing, loyal customer base who appreciate the quality and service… and they pay the premium for it!
Just wanted some other opinions on what you think? I am not trying to rip the customer off?
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