Customer Discounts ?

Many professional machine quilters give discounts to their customers. These discounts are usually about 10 – 20%, sometimes more, and can be for a variety of reasons – new customer discount, returning customer discount, sunny day discount, rainy day discount, showing up at the door discount, etc.

Personally, I don’t give discounts. I feel that you loose way too any $$ with discounts. Let’s run some numbers.

Example – Queen Size Quilt, moderate density quilting, it doesn’t matter if the quilting is free hand, pantograph or computerized.

 If you charge $250 for this quilt, with a 10% discount ($25) your charge (to the customer) would be$225, with a 15% discount ($37.50) your charge is $212.50, with a 20% discount ($50) your charge would be $200.

If you charge $300 for this quilt, with a 10% discount ($30) your charge would be $270, with a 15% discount ($45) your charge is $256, with a 20% discount ($60) your charge would be $240

Note: If you would charge a different amount, your numbers would be different.

No matter what discount you give to your customer, it still takes you the same amount of time to complete the quilting. If you calculate your cost per hour for quilting – the time it takes you to complete a quilt divided by the cost of the quilting only = cost per hour. (We will discuss “cost per hour” in an upcoming post.)

Again, some numbers – The Queen Size quilt in our example above took 6 hours to complete.

At full price of $250 divided by 6 (hours) = $41.66 per hour. For the discounted prices, $225 divided by 6 = $37.50 ph, $212.50 divided by 6 = $35.41 ph and $200 divided by 6 =$33.33 ph.

At full price of $300 divided by 6 (hours) = $50 per hour. For the discounted prices, $270 divided by 6 = $45 ph, $256 divided by 6 = $42.66 ph and $240 divided by 6 =$40 ph.

Note: NO operating expenses or self employment taxes have been taken out of the cost per hour amount.

You can see that the amount of $$ you are making per hour decreases significantly with each discount given.

Before we go any further, I want you to think about your customers. I would be willing to bet that most of your customers do not come to you ONLY because you offer a discount. Your customers come to you because they like your style of quilting, the quality of your quilting, your personality, your lifestyle, etc. Price usually isn’t at the top of their list when looking for a machine quilter.

OK, I do know that there are some people where price is the ONLY thing they look for in a quilter. Fortunately, these people are mostly few and far between and YOU get to choose if you want to work with them. Personally, if someone comes to me and wants me to quilt “cheap”, I just tell them – nicely – that I don’t do cheap quilting and it may be better for them to take their quilt someplace else. And yes, I have had to do this a few times in my machine quilting career.

So, if price is NOT the only reason your customer is coming to you, and if you routinely give them discounts, why? You may want to re-think your motivation behind your discount philosophy.

But, you want to give your customer an incentive to return to you, or you want to reward them in some way. I suggest that you offer them FREE BATTING.

I know, you are saying, wait a minute Cindy! You don’t give discounts, but you give free batting? Yes, I do! And here is why –

Batting is tangible. Your customer KNOWS what batting is and knows what the approximate retail cost of batting. Free batting also saves your customer time by not having to stop by the quilt shop and they may be able to bring their quilt to you more quickly.

Best of all, by offering the batting FREE, your customer knows they are getting a great deal.

Note: Batting should be a separate charge and not included in the price of the quilting labor.

Here is the best part for you, the machine quilter. Free batting will cost you less than most discounts!

You need to purchase your batting wholesale or at a discount. A Warm & Natural Queen Size batting, pre-cut, wholesale is $16.30 (Price at EE Schenck, Portland, OR, May 2014.) The suggested retail price would be $32.95 +/- Prices will vary for other battings and sizes or if purchased/sold by the yard.

For a $16 (+/-) investment, you don’t loose any $$ on the quilting labor that you would charge to your customer. This means that there is more $$ in YOUR pocket!

I look forward to your comments