Full Version: Turn Down The Volume
From: Stunt Engraver (DGL) [#1]
10 May 2004
To: ALL
If you're not prepared, doing high-volume work can be a nightmare.
The companies who specialize in high quantities are extremely efficient. Costs are keenly scrutinized and production techniques are honed to a fine edge. It's the only way they can make money on such slim profit margins.
I speak from experience.
When I first went on my own, a friend who owns a trophy shop said, "You'll know you've made it, when you get your first 50 pc. order." At the time, he was referring to silverplate goblets.
Well, it didn't take long to get that type of order, but I didn't feel that I had really "made it."
It wasn't long after that, when I began doing work for a company which specialized in engravable gift items. An Ad Specialty Company.
I didn't have much of a customer base at the time, so when I got orders for 100-150-200 pcs., I was stoked. The company soon became my "cornerstone" client. Sure, the unit prices weren't much - Actually, about 1/4 of what a good retail price would be, but the volume made for some decent checks. I felt as though I had "made it."
As time passed, my customer base grew, and not only did working for a fraction of retail start to bother me, but the time-consuming volume jobs were occupying so much of my equipment time that good-paying jobs were regularly back-burnered.
Then came the day that completely changed the course of my business.
I landed a job which consisted of 2,000 brass golf ball markers that needed to be engraved with a logo and color-filled. In that quantity, I charged $1.25 ea. $2500 (in one job) sounded REAL good. It was actually more than the customer wanted to pay, but I held my ground.
Well, it sounded real good until I was about 200 pieces into the job. The logo took longer to engrave than I had imagined, all-too-frequent cutter sharpenings were necessary and I had promised to deliver the order in about a week.
The tedious nature of the job and the realization that, (even though I was already burning out), I had only reached the 10% mark completely broke my spirit. I was in for the fight of my life.
I only had one engraving machine, and in order to keep all my customers happy, the ball markers had to be done in spits and spurts. Actually, I relished the breaks. The tedium and monotony were taking their toll on me.
To make the deadline, I got up early and worked late. It was brutal. There was no better word to describe how punished I felt.
As I said, it was the job that changed the course of my business.
Never again.
Ever since then, my battlecry has been, "It's better to do a few, for a lot, than a lot, for a little."
I've chosen to specialize in areas of little competiton, such as communications equipment, jewelry, avionics panels, and customer-supplied merchandise.
Oh sure, I still do my share of awards and "regular" stuff, but having a few niche markets provides great job security, and more importantly, generates a fair amount of word-of-mouth advertising - The best advertsing money can't buy :-)
Others may have a different opinion, but for me, the secret to success has been to "Turn down the volume."
David "The Stunt Engraver" Lavaneri
DGL Engraving
Port Hueneme, CA
EDITED: 10 May 2004 by DGL
From: Rallyguy [#2]
11 May 2004
To: Stunt Engraver (DGL) [#1] 11 May 2004
I know what you mean David,
We have been fortunate that our company has been able to fill both ends of the bill, but what I really love are the calls from people that want to get a quote on 250,000 entirely custom doohiggies that they want to sell on network tv, and they need a quote in 24 hours or less.
You can see the "volume" shoppers a mile away. They never have enough time to get you all the information because they are so busy putting out quotes to other vendors ;).
It always takes several hours to gather all the info on materials and yield as well as making that all so risky assesment of real actual reliable output. Usually resulting in nothing for all your efforts.
I/we have quoted from 1-250,000 pieces of various custom products. Lots of times the volume jobs are not worth quoting in the end. The largest job I remember getting is a 75,000 piece brass ornament job for a church. A couple of years back we were fortunate enough to land a 12,000 piece order with Matchbox and we recently did a job for Ford Motor company for their 100 anniversary and ended up with a 14,000 piece order from them. So they can come through. It's just not the norm. :)
Our more profitable product seems to be with local metal fab companies. The basic product is screening on their materials with a turnaround of a day or two max. That kind of service allows us to charge a premium fee and they end up feeling like it was well worth it to them because by the time we see the part it is usualy behind schedule. Most of these orders are smaller than a screen printing shop would bother with, but we have a $100 minimum even for a single prototype piece, allowing decent profit for us and great service for them.
It can work on both ends of the spectrum, but its tough going for the larger orders as you suggested. The risks of making a mistake on a larger order can be catastrophic as you experienced. An example of that type of failure for us was a 2 color job we did on 25,000 folders once. They came packed in shrink wrapped groups of 10 pieces each. We never envisioned anything other than bulk packaging for that kind of volume, but had to stick with the quote. Trust me, we lost lots of time unwrapping 2500 packets of folders. :( With volume jobs, the devil is in the details.
Brian G.
From: Stunt Engraver (DGL) [#3]
11 May 2004
To: Rallyguy [#2] 11 May 2004
Brian,
Thank you for bringing up the point of "packaging." It only takes one experience of having to unwrap and repackage hundreds (or thousands) of pieces, before "How will I receive the parts?" becomes a standard question. :-)
A great contribution to the thread. Thanks again.
David "The Stunt Engraver" Lavaneri
DGL Engraving
Port Hueneme, CA
From: Engravin' Dave (DATAKES) [#4]
11 May 2004
To: Rallyguy [#2] 11 May 2004
Brian,
I will second that comment about packaging.
I am wrapping up a job I quoted to an electrical contractor a couple years ago for laser marking stainless steel outlet and switch plates for a large hospital expansion. I didn't ask the right questions about how I was receiving them and how he wanted to receive them. Of course, they came to me boxed and individually wrapped and he wanted to receive them boxed and individually wrapped.
I still made decent money on the deal, but it was moderately painful when the orders came in. What did ease the pain were the plastic tags that he ordered for that same project.
From: Stunt Engraver (DGL) [#5]
11 May 2004
To: Engravin' Dave (DATAKES) [#4] 11 May 2004
David,
When it comes to packaging, I give my customers a multiple choice. I'm more than happy to handle the wrapping and unwrapping - FOR MORE MONEY!
At an additional .50 per item, most customers decide to present the parts to me in bulk form :-)
David "The Stunt Engraver" Lavaneri
DGL Engraving
Port Hueneme, CA
www.engravingetc.org