Local competitor with WAY LOW pricing

[SignManiac]

Diversification has been my solution to what is otherwise a commodities market. If you only one thing then your eggs will soon run out.

 

[GVP]

Diversification has been my solution to what is otherwise a commodities market. If you only one thing then your eggs will soon run out.

+1

 

[ironchef]

Its ok. I'm doing another box truck for another company today... got four times what the other guy is charging. Being a little bigger then the last quote, but its one color. So I'm not complaining, but no one likes a lowballer. In my area the lowballers are the ones running around in work vans doing signs on the go, and have small shops with no employees (no overhead). So the people on here that say, Charge what you need... duh, they're doing just that.

 

[paulica]

Short, accurate and to the point.
Best post so far.

well, over here most of the big players ( "marketing geniuses" ) are bankrupt. Large shops, with basic services, but with big jobs, are surviving at the moment. No margins at the end of the day, they are taking loans from banks to survive, not even for investments in equipments, training etc.

Now, should I tell you how much a square meter of banner is over here ? Around 4 USD. This isn't a price for large quantities, they will sell an A2 at around 1 USD.

Luckily I have my CAD plot division, where surprise, I charge more for lines than they charge for full colour. I have large infrastructure companies for customers ( for CAD ) and they tend to do full colour, banner poster jobs with me. They don't have huge quantities, but I have a good margin, sure payments and satisfied customers.

I tried talking to signage competitors, but they always say: money are in volumes. Even tough they have such low margins, that they can't even afford profiling or proofing jobs before the jobs. One idiot is stupid enough to think that while printing 300m2 of banner, he will never have to redo 5-6 banners, because of numerous reasons.

Now, guess who makes a lot of money in my market, in the signage chain ?

Companies selling ink and paper. Actually these companies push companies into offering very cheap print. Over here, one Epson dealer, with 5 employees, out of which 1 is accounts recievable, 1 accounts payable, and 1 is the mail handler ( actually mails packages ), is making 800k USD in profits each year.

So, always beware, your ink and media provider will always tell you to sell cheaper and cheaper.

 

[lexsigns]

Diversification has been my solution to what is otherwise a commodities market. If you only one thing then your eggs will soon run out.

+1 !!! . I genuinely care about each and every one of my customers, their busniesses and signs. I charge them fairly for what I do, what it costs me in materials, time and overhead, They get 110% of value from every single thing I do. If they want to price shop or lowball, I just dont play. There is always a customer who is greatful, appreciative and loyal for every one that plays games. Its your choice to play or not.
19 years... Here I am still doing what I do..

I could care less if another shop lowballs- those are not the customers or jobs I want. Someone once said to me" I dont think about what other people are doing, I only think about what I am doing and if it's right for me" Words I try to live by

 

[Kottwitz-Graphics]

The problem that I had with the local franchise shop is they had been stealing designs.

I saw my design that I did for a small job on the customers truck, and I blocked my id, and called him and raved about how good it looked, and where did he get it done. He told me that the signs by whenever did it, and I said that I was going to be giving them a call...

The problem is I sent out a quick layout to a customer without money down, and shame on me, but when the other comany gets it with the title block, and they produce it anyway, that's just low....

 

[Sign Up Graphics]

Sign Up Graphics

Seems a little low to me.

 

[SignProPlus-Alex]

I would be at $500 + install.

 

[Hicalibersigns]

+1 !!! . I genuinely care about each and every one of my customers, their busniesses and signs. I charge them fairly for what I do, what it costs me in materials, time and overhead, They get 110% of value from every single thing I do. If they want to price shop or lowball, I just dont play. There is always a customer who is greatful, appreciative and loyal for every one that plays games. Its your choice to play or not.
19 years... Here I am still doing what I do..

I could care less if another shop lowballs- those are not the customers or jobs I want. Someone once said to me" I dont think about what other people are doing, I only think about what I am doing and if it's right for me" Words I try to live by

This! The problem is you can choose to sell signs (a commodity) or you can choose to sell service, quality and relationship. We flatly tell customers if you are looking for the lowest price we aren't your guys.

 

[xxtoni]

well, over here most of the big players ( "marketing geniuses" ) are bankrupt. Large shops, with basic services, but with big jobs, are surviving at the moment. No margins at the end of the day, they are taking loans from banks to survive, not even for investments in equipments, training etc.

Now, should I tell you how much a square meter of banner is over here ? Around 4 USD. This isn't a price for large quantities, they will sell an A2 at around 1 USD.

Luckily I have my CAD plot division, where surprise, I charge more for lines than they charge for full colour. I have large infrastructure companies for customers ( for CAD ) and they tend to do full colour, banner poster jobs with me. They don't have huge quantities, but I have a good margin, sure payments and satisfied customers.

I tried talking to signage competitors, but they always say: money are in volumes. Even tough they have such low margins, that they can't even afford profiling or proofing jobs before the jobs. One idiot is stupid enough to think that while printing 300m2 of banner, he will never have to redo 5-6 banners, because of numerous reasons.

Now, guess who makes a lot of money in my market, in the signage chain ?

Companies selling ink and paper. Actually these companies push companies into offering very cheap print. Over here, one Epson dealer, with 5 employees, out of which 1 is accounts recievable, 1 accounts payable, and 1 is the mail handler ( actually mails packages ), is making 800k USD in profits each year.

So, always beware, your ink and media provider will always tell you to sell cheaper and cheaper.

Mate first of all if you're taking advice from your media and ink supplier about how to run your business you're doing it wrong.

About 4 days ago we moved into a new building as the old space we had was just too small, we now have 500 sqm and just got our net connection installed today and prices have have never been lower in the marketplace. We do it by offering an integrated package, when expanding we do it with our own capital, no loans or anything like that.

Competition is part of any business and it will almost always drive prices down unless it's some kind of cartel but that really isn't a problem. There will always be people who want quality and of course it takes time and effort to find those. Like you are doing with CAD we offer various services of which print is a part, not the most important one at that.

We got into print just a few years ago and from the get-go were strictly B2B, we soon discovered that having random people dropping by and printing stuff for them was highly disruptive. We offer various services like: design, brand building, signs, flags, car wrapping and so on, but we offer it all as an integrated package. For example if we build a brand, we do everything from the name, slogans, market research, print and so on. So we can basically charge whatever we want because we offer it as one package.

We will do everything from coming up with a name for the brand, then we make signs for the company, flags, wrap their cars, business cards, t-shirts and pretty much anything else you can imagine.

Expand or die, how to expand ? Inovate.

 

[Jillbeans]

Wow, a friend just alerted me to a new local shop opening up.
Their signs are atrocious and their prices are insane.
Anyone looking at their spelling mistake rifled website can see just how terrible they are.
Will people actually settle for this crap?
Probably.

 

[TSG]

Make sure you can really trust these customers bringing quotes....

I run in to a customer ended up in a bidding war with over a truck wrap...Turns out, he was talking other sign shops in to fabricating estimates...Telling other shops they needed a fake estimate written up for "insurance work" and actually telling the shop what amount to put on the estimates...

 

[haidenmorgan]

+1 !!! . I genuinely care about each and every one of my customers, their busniesses and signs. I charge them fairly for what I do, what it costs me in materials, time and overhead, They get 110% of value from every single thing I do. If they want to price shop or lowball, I just dont play. There is always a customer who is greatful, appreciative and loyal for every one that plays games. Its your choice to play or not.
19 years... Here I am still doing what I do..

I could care less if another shop lowballs- those are not the customers or jobs I want. Someone once said to me" I dont think about what other people are doing, I only think about what I am doing and if it's right for me" Words I try to live by

That is exactly the way I think. Charge what you need but sell real quality and value-added services. Add education to your customers and ideas that have worked for other companies using signs to promote their businesses. Give them what they need: a solution to their marketing problem; not some crap sign and a low-margin price with no valuable help along the way of delivering them that crap product. My customers have problems, we solve them. My cheap-o competitors have Oracal 631/51 and make enough to buy vinyl for the next job only to have their customers find out 2-4 years later that they got ripped off; not to mention the lack of guidance and honest advice on how to use signs along the purchasing funnel/journey. Give your customers what they NEED, not what they WANT or think they WANT, and you will be successful.

 

[Mosh]

Here is my business model!
http://www.youtube.com/watch?v=6PQ6335puOc

Lamendations of the women!!! I hope Edna does not see this one!