Making A Profit With Full Color Inkjet Sublimation
For any awards company, adding any type of sublimation process to their company should make them some nice extra profits. Adding full color inkjet sublimation can definitely be profitable.
However, before it sounds like we are suggesting an easy "road to riches," please take note of two qualifying words in the above. Those words are "should" and "can."
Like anything else that you buy, good profits depend less on the capability of the equipment and more on your ability to use it. Excellent profits depend more on how you structure what you produce, within your company, so it will be more profitable than doing something else.
The most successful (profitable) award companies seem to follow the same general outline of structure.
A firm commitment to use the process to increase revenue, by attracting new sales. Specifically, they have not offered the process just to give existing customers new options.
It is offered as a premium alternative to their existing lettering processes (engraving, laser engraving, single color sublimation, etc.) Specifically, it is priced higher, either with set-up, run, or color charges being added. Additional charges are also added for color matching.
For the most part, it is offered as an add-on sale, for either gift or memento needs. Specifically, no attempt is made to get the customer to not buy "traditional" types of plaques.
The additional time required to produce "thick" items (mugs, tiles, plastics, etc.) is carefully calculated and added to production costs. This cost is never discounted, regardless of quantity.
No effort is made to compete with single color screen-printing and even large volume transfer needs are outsourced.
While there are exceptions to the preceding 5-point outline, most "traditional" award companies are close in their methods. It should be noted that we define a traditional award company has having two or three lettering/imprinting methods, a general mix of award products and a diversified customer base.
To continue, the five points together constitute a very sound business approach and we offer a short analysis of each, to show you why.
Color is exciting and quite often sells itself. It has still not been seen by a lot of prospective customers. If nothing else companies working hard to "get the word out" are getting their names in front of prospects, before the competition wakes up.
Every type of award has what we call "flow-though" time. This is the total amount of time needed to produce one award. Because of the extra time required for good color management, 90% of the flow-through time can be spent in setup on a "onesie". If you don't take that into account you time and your profits are going to get chewed-up.
A traditional award company lives or dies from the profits of selling plaques. It isn't unusual for that profit to equal everything else combined. One of the reasons for this, is that the customers themselves have been conditioned to think in terms of gold, silver and bronze "anything" as having a special meaning and place. That is why a company can get such a premium price for a plaque.
Sublimation on anything other than metal is very labor intensive. A mug, for example, can take 4-5 minutes each, to produce. This is real "down-time" because it is not quite enough time to really productively do something else. If you don't charge for this time, you are losing money.
Screen printing a single color, with no personalization, on almost anything is very, very fast and usually done very cheaply. Most sublimators who compete against these facts make very little money.
This is especially true with large orders, in bid situations. Even with large multi-color orders (500+) sublimators usually come out better, jobbing out the transfer printing. A little desktop printer is not made for truly high volume work, regardless of what the manufacturer claims.
By itself, no one of the above points presents a "make or break" opportunity or threat. It is the five working together that seems to produce the solid profits.
Granted, with today's competitive pressures, it is difficult to set up any game plan, and stick to it. When the customer is in front of you saying if you will just do "this or that" then they will buy, it is tempting to say "Yes."
If that "yes," however, increases your costs, it decreases your profits. Profit is not a dirty word. Because it is the only thing that lets you survive, profits must be planned for and demanded.
Have fun with your full color sublimation abilities, but set it up so that you will make money with it.
After all, if you just want to work for nothing there is no point in working hard, is there?
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