How Many People Does It Take to Produce a $75 Sign?

By Debbie Nicholson

A customer calls and needs a sign. Nothing complicated. Maybe it's a 24" x 36" PVC sign, a piece of coroplast, or a simple poster mounted to a rigid substrate.

“Sure, we can do that.”

The selling price is $75. The material costs $12. The ink costs a few dollars.

Looks pretty good, doesn't it?

Not so fast.

Before we congratulate ourselves on the profit we just made, let's follow that little $75 sign through the printing company.

Because that sign may be getting more attention than some of our employees.

Sales Gets Involved

First, someone has to talk to the customer.

What size? What material? How many? Single- or double-sided? Indoor or outdoor? When do you need it? Do you have artwork?

Of course they have artwork. They email over a logo that looks like it was downloaded from their website sometime around 2007. (Groundbreaking!)

Time invested: 15–30 minutes.

Customer Service, You’re Up

The CSR creates the order, confirms specifications and the due date, communicates with the customer, enters the job into the system, and sends the artwork to Prepress.

Then comes another email:     “Can we change the phone number?

Then another:     “Can you make the logo a little bigger?”

And finally:     “Can you send me a proof before you print it?”

Of course we can!  (After all, it's just a $75 sign).

Time invested: another 15–30 minutes.

Welcome to Prepress

Prepress opens the customer's “print-ready” artwork.   Except it isn't print-ready.

The fonts are missing. The resolution is questionable. The logo is RGB. There's not enough bleed. And that tiny logo needs to be enlarged to 18 inches wide without looking like it was constructed from Lego blocks. (Yes, I have grandkids.)

Prepress fixes the file (if possible), generates a proof, sends it back to Customer Service, and waits for approval.

The customer responds:

“Looks great! One little change…”

Prepress makes the correction and generates another proof.

Approved! YAY!

Time invested: another 20–45 minutes.

Finally, We Can Produce the Sign

Production retrieves the material, RIPs the file, loads the substrate, prints the sign, removes it from the printer, and sends it to whatever finishing is required.

Maybe it needs cutting, routing, laminating, trimming, mounting, grommets, Velcro, or tape.

Then someone checks it for quality.

Hopefully, everything is correct.  If not, we get to do some of it all over again.

Time invested: another 20–30 minutes—or more.

But We're Still Not Finished

If it's shipping, someone has to package it, create the label, and process the shipment. If it's being delivered, it needs to go on the delivery schedule. If the customer is picking it up, someone still has to retrieve it when they arrive.

Then - Accounting invoices it, processes payment, reconciles the transaction, and eventually closes the job.

Time invested: another 20–30 minutes—or more.

Our simple $75 sign has traveled through:

Sales → Customer Service → Prepress → Production → Finishing → Quality Control → Packaging/Shipping → Accounting

That's potentially eight different functions touching one small order.

None seems particularly expensive individually.  But…Put them together, however, and that $75 sign begins looking very different.

Maybe You Need a Minimum Charge

Every printing company should know what it costs simply to open a job. Do you?

Before the printer produces one square foot of material, the company has already incurred costs.

That should cause us to ask:

• Do we need a minimum order charge?
• Should additional artwork changes be billed separately (Change Order)?
• Should there be a prepress minimum?
• Are additional proofs being charged (Changer Order)?
• Should rush jobs carry a surcharge? (Absolutely)
• Are packaging, shipping, and delivery labor truly being captured?
• Are Sales and Customer Service empowered to tell customers when a request creates an additional charge?
• Most worrisome, did we push a larger, more profitable project to the side to produce this $75.00 sign?  (Danger!, Will Robinson)

Look, there is nothing wrong with providing exceptional customer service.

However, there is something wrong with providing services that cost your company money without knowing you're doing it.

Something to think about: Revenue doesn’t determine profitability, knowing your true costs does!