I've had the best success using this model... Post your top labor rate very clearly in the front of your shop. Include the minimum order fee and proofing fees. Include the copyright symbol real big, with a sentrnce like this:
"All art created for client consideration is the exclusive wholely owned property of xyz signs until paid in full and released under a pre negotiated copyright release contract. We rigorously enforce copyright violations, including with the end user."
For me, it's $110 per hour, $225 for CNC/3D work. $75 minimum order, $35 per email proof. Revisions billed at 15 minute increments. All conversation time billable. That leaves no dispute that your billing for time.
When they ask for a design, happily quote the time it'll take to create two concepts and one revision to one concept.
Then ask for the order.
If they balk, usually they'll say something like "the other shop will do it blah blah blah", or "I need to see it before I buy it", or "my (wife/husband/dog) needs to approve this before I spend"..
I reply with a simple matter of fact statement.. " I won't do that. It's not part of my business to give away labor. You've seen my work. You know I'm capable. I understand you need to see what you're sign will look like, but that is part of the product and service sign shops like mine charge for. It's expected clients pay for that."
In reality, most customers in your shop have already decided to buy from you. Some more scrupulous shoppers may test boundaries in some cases, but usually they just don't know that we make our living making art.
They devalue it in their minds thinking it's just some computer time and only a few minutes. If I sense this I draw it into the conversation. I give a quick run down of how the quick design for them to shop art will cost my shop an hour minimum. And I remind them that any design I might create without payment couldn't be used elsewhere as it's my copyright property. So there's no motivation to create free art.
Usually they concede. If not. I know that my local competitors won't do free art so it's moot.
If you set terms up front on your shop and on your website, these issues will go away for the most part.
its only a freaking sign!