$20 Signs — Ironic, Isn’t It?

Setting The Scene

I live in a really beautiful part of the country — near Asheville, North Carolina — on a relatively rural road with gorgeous views of the backside of the mountains in Bent Creek that I can see from my bedroom window every morning. The other day, I was heading out to the grocery store when I passed a coroplast sign in the front yard of a small home.

Rainbow Christmas 05

The Sign Said: “$20 Signs”

Pretty ironic that sign would be in the yard of a house just a quarter-mile from the home of the guy who wrote EstiMate! Needless to say, I was stunned.

It’s really tempting to stop and talk to them about profitability, but I fear it would fall on deaf ears. I’ve found over the years that people really think cash in hand is the same as profits. I suspect this guy got hold of a vinyl plotter, a few rolls of vinyl, some coroplast blanks, some stakes, and set himself up to make some money. Granted, his cost on those signs is probably in the neighborhood of $8 apiece — or, he might think it’s $3 if he wants to believe some of the people out there shouting “get into the sign business now — it’s a gold mine!”  But, his $12 profit won’t get him very far except as funny money on the side.

It amazes me that even in our industry, a solid industry of hard workers, intelligent people, with a long track record of advertising businesses around the country and making them more profitable, we have hawkers setting people like this up with false expectations and high hopes. There is a lot of money to be made in this business, but it’s not by undercutting and devaluing the industry as a whole. We have to stand up for ourselves, and make a fair profit on our work, or there’s no point in us being in business at all.

If I sound like I’m on a soapbox, I am. This one issue is the one I’m most passionate about and long after I’m gone, I hope the impact I have on the sign industry is to help raise the floor for everybody and bring us all to a for-profit mentality. There is no reason in the world that we shouldn’t be able to sell coroplast signs for $50 and charge for the stake as well.

Why are we in this business anyway?

  1. We love it! We eat sleep and breathe signs, we love beauty in advertising, and we’re passionate about this.
  2. We want to be our own boss.
  3. We want to make better money than if we had a “J.O.B.” — “Just Over Broke.”

Number 3 is where the profitability piece comes in. Neglecting profitability, and undercharging for work, hurts us, hurts the industry, and hurts our futures. Being in business for ourselves gives us the opportunity to retire early, and were throwing it away when we undercharge. Every time we undersell our work, we are incrementally giving away our retirement, our health care, our vacations, and our futures.

As promised, here’s the math

OK, so you’re selling a 4′ x 8′ sign with basic vinyl lettering on it for about $250. You should be making about 100 bucks on this sign, if you’re pricing your work correctly. Now let’s play with the price.

If you cut your price down to $200, yes, you’ll be more likely to get the job. However, that customer is going to come back and expect the same sign for the same $200. If you raise your price, you’ll lose the customer — not because you are too expensive, but because you set their expectations too low the first time you sold them a sign. So now you’re stuck making half the profits you should be, which leads you to work the classic 10 to 14 hours a day in the sign business!

Think about it. By cutting your profits in half — remember, profits are really the only money you’re making — you now have to make twice as many signs to make the same money! You’ve doubled your workload for the security of getting that job.

Now let’s go the other way. If you raise your price to $350 you’ve done the opposite. You now have to make half as many signs (read: get half as many jobs) to make the same amount of money, freeing up gobs of time to chase down more profitable work and really bank some profits. So now, instead of being completely snowed under by work and unable to spend any time with friends and family, you’re spending your time chasing down valuable work and going home at five o’clock. There are thousands of sign makers out there doing this every day who will back me up.  Not getting every bid is a good thing.  Actually, here’s a rule of thumb: for every bid you win, you should lose one too.  If you get more than half the jobs you quote for new customers, you’re too cheap.  If you get less than half, improve your sales skills — your prices are good.

An EstiMate Success Story

My friend and longtime EstiMate user, Glenn Taylor, told me a story nine years ago — this was in 2001, so think about what signs were selling for then — about selling the 4′ x 8′ sign described above for $750. That is not a typo. It was a basic 4′ x 8′ vinyl sign, and he sold it for $750. What expectations did HE set in the customer’s mind? Using the math above, he made about $600 profit on that one job.

That’s the kind of money we should all be making on our work. I grew up in my mother’s sign shop, and I remember her selling signs in the 1980s for the same prices they are being sold for today. According to the measuring worth website $250 in 1985 dollars should be worth $500 at minimum today. Yet we are still selling 4′ x 8′ signs for $250.

It’s really time for a wake-up call and for us to start standing up and charging what our work is worth.

From now on, whenever you hear me use the word “profitability,” just insert this entire article instead of that word. This is what I’m really talking about.

Please Comment

I really welcome your thoughts on this and would love to have this evolve into a profitability discussion.  Please leave your thoughts below.

Now go out and make the rest of 2009 the most profitable year ever!


  • Glenn Taylor says:

    Several years ago I had the opportunity to meet Butch Anton at an “open house” of one of my material suppliers. He was giving a talk on selling and said something that has stuck with me ever since.

    “If you don’t ask for it, you won’t get it.”

    That’s how I ended up getting better prices for my work including selling 4′x8′ for $750. You’ve got to show confidence and believe in yourself when you’re selling. You’ll appear more credible in the eyes of your clients. And the more credible you are, the easier it is to sell at higher prices.

  • Mark says:

    Hi Glenn! Thanks for stopping by. That story has always stuck with me and I didn’t realize the inspiration also went back to Butch’s comment.

    Great to hear from you!

  • Amen to that Mark–

  • Doug Allan says:

    The beginning of my first exploration into the internet led me to a site called colorcut.com As an dissatisfied buyer of a Roland colorcamm, I was returning it to purchase an Edge when a post by Glenn Taylor (above) led me to 2 other websites that have been a huge part of my education in the sign business ever since.

    Glenn gets credit for another breakthrough in my thinking. Who knows what story or sign man it may go back to, but I read once where Glenn explains to clients about the price of a sign:
    “It’s not about how much money it “costs” you, it’s about how much money it “makes” for you.
    “If it makes you money, it hasn’t cost you anything”

    That line (or my own embellishments on the concept) have been helping me sell, and UPSELL my signs for the last 7 or 8 years since I first read it!

  • Mark says:

    Doug, Glenn is one of the sharpest guys I know in this business. I really like the quote – it’s so true, and what a great way to upsell!

    Thanks for dropping by.

  • matt says:

    Yeah, Sounds GREAT, but when you have other sign companies all around you doing corosign for $5-$10 and you are selling them for $15-20, everyone thinks your ripping them off. This goes with all signs, graphics, and wraps in this area, and I don’t know why. I’m in it to get riches quickest (Making Money) versus who will go broke first (I aint in it for my HEALTH). Any Suggestions.

  • John de Jong says:

    Question for Doug Allen. What were those other 2 websites which have been a huge part of your sign business education?

    Re: competitors undercutting. Never be afraid to ask for the higher price. (Fear is your enemy, not your competitors) You can always drop a few bucks, but never go up. ”
    I bought this company a year ago and have raised prices to realistic levels. Yes I lost some customers, but not all of them. They weren’t customers I could afford to lose, they were customers I couldn’t afford to keep.

  • All signshop owners should read this at least every six months.

    Great article.