We dont directly have a minimim charge, but we do have a "base" charge, and that base charge varyies depending on the product.
By base charge, I mean that in our pricing formula, we start out with a small fee, basically just to cover minimal customer service costs. So like with our "vinyl ready to apply" product, I think we charge something like $10. Thus, if our per square foot charge is $1.44 (its not really that low, I am just using that figure for convienice example), and someone came in wanting a 1 square inch cut vinyl product, they would get hit with the $10 base charge plus the once cent charge for one sq inch of vinyl. If their project was one sq foot, it would be the base charge of $10 plus $1.44 for the vinyl. Of course that does not include any artwork, but the $10 justifies us turning on our equipment, inserting a disk (or pulling up an old repeat job), and sending the job to the cutter.
Oh, I just checked, our actual base charge for VRTA is $17.75, but you get the point.
We pretty much do the same thing with screen printing, and all our other products. We have a setup charge for screen printing of $70 per screen, and then we bill each item at what would essentially be the lowest cost bracket that most of our competitiors have (like the 1,000+ bracket). So if someone order a single white tshirt printed in just one location with just one ink color, the cost would be $70 + $3.35 (for the shirt and the print), if someone placed the same order, only for 100 shirts, the cost would be the same $70 setup (base) charge plus $335 for the hundred shirts.
Many of our screen printing competitors do basically the opposit. They will have a very small setup charge, but then have a whole bunch of little brackets and price the shirt and printing cost depending on how many shirts the customer is getting. Generally, either way, the bottom line price the customer is going to pay will be about the same. The reason I choose to not subsidise our setup cost with a higher print and shirt cost on smaller orders is two fold, first of all, a bracket or matrix system is more complicated than my simple system, the other reason is that in all truthfullness, after the art and customer service work and equipment setup is done, it is no cheaper to print the third shirt than it is the second shirt, or the 100th shirt or the 1000th shirt - its all the same. And pricing using brackets creates some weird anomalies in price, such as if the top of one bracket is 59 pieces and the bottom of the next bracket is 60 pieces, then a customer ordering 60 pieces would end up paying less for his order than a customer ordering 59 pieces - and that makes no sense to either the printer or to the customer.
We rarely explain our pricing formula to customers though. If you explain your pricing formula they try to use that explaination as a negotiating point and will try to negotiate away the setup/base charge as they will assume that it is just bullshit anyway. In truth, you have to have some type of base charge to compensate for your customer service time, pulling up artwork, sending files, changing rolls or inks, creating the invoice, recieving the payment, placing material orders, and stuff like that.
Our average invoice is only around $250, largely because we do offset printing and that involves a lot of little orders of business cards and rubber stamps and other small ticket items that we sometimes farm out and really dont make a lot of money on, maybe not even enough to cover the customer service costs. We feel that we have to offer these products, because a lot of our customers who also order bigger ticket items use them, and when the order is from a repeat customer we can make money on the transaction because their orders may include a lot of them, or at least multiple items all purchased at the same time using similar artwork that we already have on file for them, and all invoiced together. But when it is just Joe Schmo coming in wanting to spend an hour talking to us about ordering a box of business cards because he is thinking about going into the lawn cutting business, it is really a loosing proposition to us. I always tell myself that maybe Joe Schmo will also get some car mags and some signs, and some envelopes and letterhead and business forms and invoices, but in reality most of the time Joe Schmo has no money and a week later is back out of business.
We currently have only one csr, yet we have to sell about $2000 a day worth of work. Thats no big deal if it is one $2000 order, but one csr cant deal with 50 $40 orders in a day. I have considered putting up a big banner on our building something to the effect of: Minimum order of $100 required.
