2023 Wrap Up. First Year Doing Sign Printing Business, No Experience, Gross 800K, Net 0, Need Advice!

[intelli-made.com]

Hello everyone,

I've been a member of this community for over a year now, and I've learned so much from all of you. First and foremost, I want to express my gratitude to each and every one of you for your contributions and support.

Let me share a bit about our journey. I come from a background in the automotive industry and dabbled in IT before venturing into this business. My partner and I decided to open our shop after witnessing the success of his laser cutting business, which focused on acrylic sneeze guards and generated an impressive $1-2 million in net profit using two Chinese-made laser machines between 2020 and 2022.

However, with the pandemic's decline in demand for these products, my partner and I saw an opportunity to diversify our business. We established our shop in Los Angeles, where costs can be quite high, but we were fortunate to find a spacious warehouse spanning 5600 square feet for $8,000 a month – it even comes with its own yard, which I really appreciate.

While I didn't have much experience in printing initially, my background in photography helped me grasp some of the concepts involved in printing more easily. We've recently ordered a range of printing machines, and our journey has just begun.

Currently, our printing department includes the following machines: Mimaki JFX200-2513 (Dual CMYK), Mimaki UCJV300-160, HP Latex 700, Epson F6470H, EPSON 9890 converted to dye sublimation, and Canon Pro4100. We rely on Onyx RIP software for all our printers, which has proven to be a wise investment after some initial struggles with Mimaki's software.

In our finishing department, we operate a JW CB03 2516 Digital Cutter (a budget-friendly Chinese alternative to Zund – I dream of owning a Zund one day!), a 7.5KW 4X8 Chinese CNC with Camera System, RollsRoller 340/170 Flatbed Applicator, two 4X8 Finishing Tables, Keencut Evo 3 Cutter, Gallery Stretcher 60 for canvas, two 48X36 CO2 Lasers, a 47X59 Large Format Heat Press from China, and a 16X20 Small Heat Press. Additionally, we have a Double Head Angle Cutting Machine, Picture Framing Joint Machine, and two laminators. We also use EFI ES2000 for color profiling.

It was a significant challenge for me to get all these machines working together, especially with just two employees – one for printing production and the other for packaging, shipping, and laser cutting. However, they are both brilliant and manage all these tasks without any issues. It wasn't until August that everything finally ran smoothly, and now our shop operates more like huge size copy shop with out image press which is wired.

I must admit that I lack experience in certain areas, particularly installation and hands-on skills. This limitation has led us to miss out on some orders. As a result, I have started accepting orders that I believe we can handle, such as foamcore, vinyl,decal and other printing-related jobs that align with our machine capabilities. However, this approach has reduced our efficiency, and I often find myself exhausted, especially with many smaller orders that are in the couple hundred-dollar range – a challenging fit for our shop's size.

We also sell acrylic products, posters, and metal prints on Amazon, and it took a considerable amount of time and money to perfect our chromaluxe printing process. We invested in an i1 Pro 3 Plus to improve color profiling and minimize reflections. The testing process consumed a lot of materials and resources, adding to our overall costs.

On Amazon, we generated about $600,000 in sales, but after deductions, I received around $250,000. This amount needs to cover our rent, wages, materials, box shipping and various unexpected expenses. In addition to our Amazon sales, we secured over $200,000 in domestic orders, primarily for foamcore cutouts used by party planners. I also handle our social media efforts. However with all these cost we made 0 maybe losing some money.

The commercial printing and sign industry is vast and offers numerous products, each with its unique characteristics, such as different types of vinyl, material, some require specialty hardware and it is hard to do bulk order. Like printing same poster for 10000PC rather 10000 People order 10000 different poster and need ship each one, which sucks.
Right now i am not able to have my machine running fully everyday. Roll to Roll Machine produce only 100 Sqfts of vinyl which is totally not enough. We got order from local delivery company and after doing 30-40K worth of business. They already filled the glass of all their restaurants

To address these challenges and diversify our revenue streams, we're currently working on setting up an online order Web2Print system with a focus on photo products like metal prints and canvas prints. We also plan to run Meta Ads to expand our reach. Given our inability to fabricate signs and compete with B2 Sign on wholesale printing, this shift towards online photo product sales appears to be our breaking point.

We finally have the capability to produce high-quality metal prints,canvas,giclee print,and Acrylic Facemount prints. but it's crucial to scale up and optimize the process due to the expensive materials involved, including nelson framing. The profit isn't high but i see some company can take 200 order of these stuff a day.It's not an easy industry to navigate, but I'm committed to making it work since we're already deeply invested in it.

I welcome any and all suggestions and advice from everyone here. Thank you for being a part of this journey with us.

 

[balstestrat]

Too many things going on. Too many large machines with no work for them. Not enough people to run them at full capacity anyway.

You have to figure out your core business and lose the rest. If it's not making money it's not working. Web competition is fierce. Does it really make sense doing it from LA?

 

[intelli-made.com]

Too many things going on. Too many large machines with no work for them. Not enough people to run them at full capacity anyway.

You have to figure out your core business and lose the rest. If it's not making money it's not working. Web competition is fierce. Does it really make sense doing it from LA?s

So i am stuck with varity of different kind of order everyday and they are not enough to run these stuff at capacity. that is really suck. Only flatbed sometime i can run 10-15 boards a day

 

[CanuckSigns]

Too many things going on. Too many large machines with no work for them. Not enough people to run them at full capacity anyway.

You have to figure out your core business and lose the rest. If it's not making money it's not working. Web competition is fierce. Does it really make sense doing it from LA?

I agree, your list of equipment would make a shop doing $10 million a year in sales jealous! Far too much upfront investment in equipment you don't need yet.

Also I agree, if you are trying to do web2print, you would be much better off from a lower cost of living area of the country, possibly somewhere more centrally located to allow for faster and less expensive shipping to your clients.

I would focus on your core products, sell any equipment that doesn't get used enough to pay for itself and learn to lean on outsource wholesale vendors for the rest of your products.

 

[damonCA21]

I think the main mistake you have made is setting up a large expensive shop capable of doing anything without actually seeing first if there is any demand for what you can produce. As you have now found out the machines are sitting idle making you no money and you are paying huge amounts for space that isn't utilised, it is basically just storage for machines that don't get used.

You say you want to move into canvas printing. There is basically no money in this anymore. Your competition is running from their garage on a cheap printer with virtually no overheads. Selling on Amazon you are also competing directly with sellers in China who can sell far cheaper than you and as you have found out, you don't make much profit from it.

What most sign companies do is start small, and then expand WHEN they get the big commercial orders in. You seem to be doing it backwards.

What you need to do is focus on the items you can actually sell already. Get rid of the shop that is costing you $150K a year to run, get rid of the machines you don't need or put them in storage. You made a lot of money during the pandemic from the sneeze guards and that was luck, as you have found out now nobody really needs them anymore. You are very unlikely to make anywhere near that sort of money from the sign industry.

Sorry if it sounds harsh, but unless you make big changes you are going to find all your money has gone with nothing to show for it

 

[Notarealsignguy]

Build it and they will come doesn't usually work. The main points have been hit by everyone above. I would say that most everyone needs to ignore their covid numbers since they are an anomaly and not representative of your true business. This is what people are going to be faced with in upcoming years if they used that short time frame as a basis for capital expenditure. We're seeing a lot of 2022 vocational truck orders (concrete mixers, semi tractors, service bodies etc) showing up late 23 to current that companies are not scrambling to come pickup like they were. Had 2 older trucks that were here for refurb and decals get towed out of here to the auction last week due to the lack of need.

 

[binki]

Are you saying Amazon took $350K? For what?

 

[victor bogdanov]

Are you saying Amazon took $350K? For what?

i sell on Amazon, the fees/returns/shipping/ads are expensive. In most cases Amazon makes more on the items I sell than I do

 

[victor bogdanov]

You went all in on equipment from day one when a lot of the tasks the machines do could be done by hand/manual process or outsourced.

Anytime I try sell a new product I'll do it the manual way or outsource until volume justifies getting a machine to do it. I sell a decent amount of colorplast/foamboard and I don't feel I have enough volume to purchase a flatbed printer. I'll print on vinyl on the roll2roll printer and mount using the flatbed table, etc or outsource orders that won't have time for.

You have a dream shop setup but in most cases it would take many years if not decades to get to that, going all in from day one can be risky.

 

[victor bogdanov]

The profit isn't high but i see some company can take 200 order of these stuff a day

Some of these companies have multiple business models/brands which allows them to keep equipment busy and scale up.

On Amazon there is a big poster/acrylic/wallpaper company, that is also a big "trade only printer" (you mentioned them in your post) . Helps keep volume/scale up to justify the expensive equipment.

 

[damonCA21]

i sell on Amazon, the fees/returns/shipping/ads are expensive. In most cases Amazon makes more on the items I sell than I do

That is ridiculous For the OP though, if they are turning over $800K a year, they should be making at least $300K clear profit on that if not more.

 

[ikarasu]

When I sold on Amazon I found I made 30-40% as well.

Even a single sticker - I sold 1 sticker for $9.... Amazon would take $6 and leave me with $3. Doesn't matter if someone buys 1 sticker or 10... They charge the same amount for shipping if it's FBA.

If you sell and do your own shipping, there's more profit... However most people want the next day fulfilled by Amazon shipping.

I imagine signage and larger items cost more in shipping fees.... So I can totally see Amazon eating that much of the Proffitt up.

 

[victor bogdanov]

I imagine signage and larger items cost more in shipping fees.... So I can totally see Amazon eating that much of the Proffitt up.

Returns are a huge problem on Amazon.

it used to be that a buyer had to contact a seller before returning. Now it is all auto approved, auto return label generated full refund on first scan. Receive damaged item or no item back. Spend hours going through the Amazon process to maybe get the return shipping cost back to you.


Some categories like women's clothing are 40% return rate, all at the expense of the seller/manufacturer, amazon still pockets a small "processing fee"


Amazon is about 40% of my total sales but makes up 99.999% returns, all of which are "changed mind", "bought by accident" reason

Every other marketplace I sell on is practically 0% return rate

 

[binki]

i sell on Amazon, the fees/returns/shipping/ads are expensive. In most cases Amazon makes more on the items I sell than I do

Hmm, seems like I wouldn't be selling on Amazon. You still have all of your time, material and overhead costs on top of that.

 

[Billct2]

Like others said, you did it backwards and way too diverse in expensive machines. Doesn't even sound like you're in the "sign" business. I guess the best you can do is an analysis of what makes money and focus on those. If you can't drum up work for the other machines you may have to cut your losses. There's a lot of redundancy in the sign/print market tight now and anything that can be sold and shipped in a box is way too competitive. For us it's being able to install that keeps us competitive.

 

[rydods]

Exactly!

outsource until volume justifies getting a machine to do it

 

[Johnny Best]

You should put flyers out to artists and rent your machines out for their artwork. So much for hourly use or large projcts, you will just have to oversee the machines use. Better than just sitting around collecting dust.

 

[JamesLam]

Are you saying Amazon took $350K? For what?

Fuel, Champagne and caviar for Bezos' space jaunts. "Look at me I can float and snort caviar up my nose!"

 

[Guerilla Grafix]

You should put flyers out to artists and rent your machines out for their artwork. So much for hourly use or large projcts, you will just have to oversee the machines use. Better than just sitting around collecting dust.

That's a good idea, especially in LA with the deep music, film, and art scenes

 

[hulign]

Hello everyone,

I've been a member of this community for over a year now, and I've learned so much from all of you. First and foremost, I want to express my gratitude to each and every one of you for your contributions and support.

Let me share a bit about our journey. I come from a background in the automotive industry and dabbled in IT before venturing into this business. My partner and I decided to open our shop after witnessing the success of his laser cutting business, which focused on acrylic sneeze guards and generated an impressive $1-2 million in net profit using two Chinese-made laser machines between 2020 and 2022.

However, with the pandemic's decline in demand for these products, my partner and I saw an opportunity to diversify our business. We established our shop in Los Angeles, where costs can be quite high, but we were fortunate to find a spacious warehouse spanning 5600 square feet for $8,000 a month – it even comes with its own yard, which I really appreciate.

While I didn't have much experience in printing initially, my background in photography helped me grasp some of the concepts involved in printing more easily. We've recently ordered a range of printing machines, and our journey has just begun.

Currently, our printing department includes the following machines: Mimaki JFX200-2513 (Dual CMYK), Mimaki UCJV300-160, HP Latex 700, Epson F6470H, EPSON 9890 converted to dye sublimation, and Canon Pro4100. We rely on Onyx RIP software for all our printers, which has proven to be a wise investment after some initial struggles with Mimaki's software.

In our finishing department, we operate a JW CB03 2516 Digital Cutter (a budget-friendly Chinese alternative to Zund – I dream of owning a Zund one day!), a 7.5KW 4X8 Chinese CNC with Camera System, RollsRoller 340/170 Flatbed Applicator, two 4X8 Finishing Tables, Keencut Evo 3 Cutter, Gallery Stretcher 60 for canvas, two 48X36 CO2 Lasers, a 47X59 Large Format Heat Press from China, and a 16X20 Small Heat Press. Additionally, we have a Double Head Angle Cutting Machine, Picture Framing Joint Machine, and two laminators. We also use EFI ES2000 for color profiling.

It was a significant challenge for me to get all these machines working together, especially with just two employees – one for printing production and the other for packaging, shipping, and laser cutting. However, they are both brilliant and manage all these tasks without any issues. It wasn't until August that everything finally ran smoothly, and now our shop operates more like huge size copy shop with out image press which is wired.

I must admit that I lack experience in certain areas, particularly installation and hands-on skills. This limitation has led us to miss out on some orders. As a result, I have started accepting orders that I believe we can handle, such as foamcore, vinyl,decal and other printing-related jobs that align with our machine capabilities. However, this approach has reduced our efficiency, and I often find myself exhausted, especially with many smaller orders that are in the couple hundred-dollar range – a challenging fit for our shop's size.

We also sell acrylic products, posters, and metal prints on Amazon, and it took a considerable amount of time and money to perfect our chromaluxe printing process. We invested in an i1 Pro 3 Plus to improve color profiling and minimize reflections. The testing process consumed a lot of materials and resources, adding to our overall costs.

On Amazon, we generated about $600,000 in sales, but after deductions, I received around $250,000. This amount needs to cover our rent, wages, materials, box shipping and various unexpected expenses. In addition to our Amazon sales, we secured over $200,000 in domestic orders, primarily for foamcore cutouts used by party planners. I also handle our social media efforts. However with all these cost we made 0 maybe losing some money.

The commercial printing and sign industry is vast and offers numerous products, each with its unique characteristics, such as different types of vinyl, material, some require specialty hardware and it is hard to do bulk order. Like printing same poster for 10000PC rather 10000 People order 10000 different poster and need ship each one, which sucks.
Right now i am not able to have my machine running fully everyday. Roll to Roll Machine produce only 100 Sqfts of vinyl which is totally not enough. We got order from local delivery company and after doing 30-40K worth of business. They already filled the glass of all their restaurants

To address these challenges and diversify our revenue streams, we're currently working on setting up an online order Web2Print system with a focus on photo products like metal prints and canvas prints. We also plan to run Meta Ads to expand our reach. Given our inability to fabricate signs and compete with B2 Sign on wholesale printing, this shift towards online photo product sales appears to be our breaking point.

We finally have the capability to produce high-quality metal prints,canvas,giclee print,and Acrylic Facemount prints. but it's crucial to scale up and optimize the process due to the expensive materials involved, including nelson framing. The profit isn't high but i see some company can take 200 order of these stuff a day.It's not an easy industry to navigate, but I'm committed to making it work since we're already deeply invested in it.

I welcome any and all suggestions and advice from everyone here. Thank you for being a part of this journey with us.

We have some stuff in common. I was an automotive tech and found myself with my right arm paralyzed. While I was recovering from neck surgery I came to work for my father-in-law. Shortly after finding that some of the damage done was permanent we decided to buy the printshop. We are a very small union printshop only 3 of us here most days. My wife does bookkeeping on the side of her "real job" working in real estate for the city.

We didn't really add on much to the equipment but we do some decal work (no installing). We have 2 Ricoh copiers, and various support equipment. We use a non auto CNC router system and a small laser to cut some signage to run on our Jfx200 flatbed. You would think buying an existing business from family would get you a better deal but no. All of the equipment was/is on its last leg. My FIL basically ran the entire business by the seat of his pants and kept all of the info in his head. The building was a mess and needed repairs as well. It looked decent on paper but he seemed to know every cheat there was. Once we signed rather than stick around and help us learn stuff he took off to FL. Anyway... We don't work that way. We found almost 75% of the customers were 50+ years old and had one foot out the door toward retirement or death. Our mis system hadn't been set up right and nothing had been taken off the pending screen in 8yrs. Fact is we are teetering in the same position too far in to go back and fighting for every dollar. Hopefully since your stuff in in better shape and you are renting there is a chance you can make steps. Everyone has covered cutting costs. Narrow your range, get rid of some equipment. It will be worth less and less buy the minute. Find a smaller and cheaper place. If you aren't doing walk in work location doesn't matter as much. Go thru all your records, find the things that have grown and chase them. Knock on doors, leave cards and samples. That is something the online places can't do. Make sure to keep your customer data straight so that you can see that "Hank" hasn't been in for a while and reach out. People are creatures of habit and will stick with a good supplier that is easy to deal with even if he costs a little more. Sometimes people try somewhere else and aren't happy but they are too busy or lazy to deal with it. Make it easy for people to come to you. Farm out some work and let the other guys take that burden. Lighten your own load. As for us, we do mostly union and polical work. We have worked hard to appeal to a younger crowd. We do 99% of things in house mostly because of the union stuff and the fact that we have to have our label on it. There are a lot of people that lie and farm out the work and have their bug slapped on by the other shop. I decided we weren't going to do that and we have stuck to it. We treat all of our customers like they are the good side of the family. Our Facebook isn't full of fake posts by a social media manager, it is quite literally me. My wife and I like it that way. We are always teetering on needing another employee but then we hit a lull and I'm glad we didn't hire another mouth to feed. We have made strides in some of these areas but we are a complete failure at customer data and consistent pricing which hurts us. We signed up for a different MIS that is too complicated and has too many features a shop our size doesn't need. We have never done any advertising other than being a good friend to the community around us. Our age range of customers has trended younger and they tend to recommend us on line before I even see a post. I feel like we can keep rowing and improving. I'm just not sure we will survive the journey. If anyone has a handle on a simple spreadsheet, database and invoicing system that we can run locally please let me know.

Sorry for the long message, I blame the pain meds and not getting out enough!