Markup question

[TeamOutlaw]

We are in the process of giving a quote out for a rather large project (for us anyway) which involves some larger (10'x10') backlit cabinets, 5' tall x 80'W Gemini lettering attached to a concrete wall 30' in the air, interior Gemini lettering in 20 locations, misc. interior signage etc.

The company has basically not even asked for pricing up to this point...basically said 'get it done'! So, we want to take advantage of this...however, we don't want to get greedy & throw and red flags either as their is potential for a lot of future work with them if we treat them right.

Our basic question is % of markup. Seeing how we are not actually fabricating the backlit cabinets or Gemini lettering and just being the project coordinators and installers most of our portion is in labor and a few install supplies.

Let's just say you have $10,000 worth of product (backlit cabinets / Gemini lettering)...is a 50% markup too little, too much or in-line!? Seems like if we are 'risking' $10k, to make $4k-$5k. I realize different markets command different pricing...just wondering as a general rule-of-thumb if 50% m/u is in line or not!? Or...are you guys straight-up doubling the job!?

 

[ddarlak]

i double the cost of what ever i buy, sometimes even triple, then add in labor rate, then add in a little more just in case.

 

[Kevin-shopVOX]

We are in the process of giving a quote out for a rather large project (for us anyway) which involves some larger (10'x10') backlit cabinets, 5' tall x 80'W Gemini lettering attached to a concrete wall 30' in the air, interior Gemini lettering in 20 locations, misc. interior signage etc.

The company has basically not even asked for pricing up to this point...basically said 'get it done'! So, we want to take advantage of this...however, we don't want to get greedy & throw and red flags either as their is potential for a lot of future work with them if we treat them right.

Our basic question is % of markup. Seeing how we are not actually fabricating the backlit cabinets or Gemini lettering and just being the project coordinators and installers most of our portion is in labor and a few install supplies.

Let's just say you have $10,000 worth of product (backlit cabinets / Gemini lettering)...is a 50% markup too little, too much or in-line!? Seems like if we are 'risking' $10k, to make $4k-$5k. I realize different markets command different pricing...just wondering as a general rule-of-thumb if 50% m/u is in line or not!? Or...are you guys straight-up doubling the job!?

markup isn't enough to cover a mistake should it occur. If it goes south and a redo occurs your are 5k in the hole.

 

[StarSign]

Money is no object until you send them the bill.

 

[Signsforwhile]

i double the cost of what ever i buy, sometimes even triple, then add in labor rate, then add in a little more just in case.

honestly used to run my business exactly like this. "eh double it and throw something on for labor"

then realized that it comes with major flaws because you are in no way taking into account your overhead. found that some things were way over priced and some completely under priced. ends you up winning the wrong jobs and losing the right ones.

you should always control what you want to and should make

Just ordering and reselling?

Markup the cost of the cabinets by whatever your normal rate is.
Only took 15 minutes to order? Ad up what it costs to turn the lights on for 15 minutes in your shop. Then what it takes to receive and unpack and organize them. Mark that up by your normal rate.......so on and so forth.

 

[ddarlak]

honestly used to run my business exactly like this. "eh double it and throw something on for labor"

i was strictly responding to this question. when purchasing a wholesale sign cabinet, doubling or tripling is right on.