Cowboys: An Industry nightmare

Sometimes I wonder how our industry copes with the ‘cowboys’ that operate under the ‘sign maker’ umbrella.

I was on a job the other day as a subcontractor to another sign company. I was fitting several jobs internally when a manager invited himself in the room and proceeded to tell all the other managers present, that guys in our industry are making an absolute motza.

I was somewhat stunned.

Shane Drew has been involved in the sign industry since 1992. Before that he had a very successful career in sales, winning several Sales Awards before deciding on a career change in his early 30’s. Shane has been writing freelance articles since 2002 and is a sign industry mentor for sign shops both in Australia and Europe, is a regular contributor to Europe’s biggest sign industry forum, and is well known in local circles for his passion about the Australian Sign Industry. Shane is Managing Director of Drews Sign It Pty Ltd, a family business who are supporters of several major charities and not-for-profit organisations. A recent highlight is his appointment as a Green Guardian for his support of Currumbin Wildlife Sanctuary, on Queensland’s Southern Gold Coast.

This bloke went on to explain to his peers that we sign makers pay a ‘pittance’ for our material, our inks are as ‘cheap as chips‘, and every job is nothing but profit.

I was somewhat speechless, not an easy task for someone as opinionated as me.

Keeping in mind that I was actually representing another company, and not my own business, I was keen to be seen as polite for fear that my response may have reflected badly on my client.

Instead of turning around and calling him an idiot, I asked why, or how, did he come to that conclusion.

His response?

“His best mate just went out and purchased a JV3-160 off Ebay, and the sign guy selling it also gave him all his vinyl stock for free, and its got a bulk ink systems which go forever without needing refilling” He went on to tell us that his mate has set up ‘shop’ in his garden shed, and does signs on weekends and after hours. He is, according to this bloke, making a fortune. He works with him on weekends to ‘learn the trade‘.

I had the eyes of 8 other managers looking at me for a response.

Once again, thinking of the sign shop I was working for, I again resisted the temptation to call him a moron.

I asked him several questions, in front of his peers.

‘Tell me’ I said ’do you know how much the ink costs per litre?

“Not much” he replied.

I asked ’how much does a new head cost then?’

“My mate hasn’t needed one yet, but he reckons a hundred bucks should cover it”

I shook my head.

I went on. ’Has it been serviced since your mate purchased it?’

His reply was typical of this guys stupidity. “Nah, the guy he purchased it from said it never needs servicing”. I’m sure the technicians I know would love to know that.

I decided to change tack. ’What sort of work does your mate do?’ 

This got him really excited..

“He does trucks and cars and boats…. Anything really.”

I enquired ‘What lamination does he use?’

The response was exactly as I expected. “Lamination? Doesn’t need it”

I really wanted to go for the jugular now, but I was still mindful of who I was representing.

His peers were still listening intently. I was in the board room with an audience of people that were keen to see how I could justify the charge for the 15 signs I was installing. I felt the need to clarify a few things, so threw caution to the wind.

I started of by saying “With all due respect….. your mate is a cowboy, and the seller was dishonest. To say a printer doesn’t need servicing is just plain dumb. Does he service his car? Of course he does. His printer is no different“

I went on to explain that his friend had better do his homework before he goes too far down the ‘sign maker route’ or he’ll being going broke in the not too distant future.

I pointed out a few home truths to all present, and enlightened them on my own costs in maintaining my two printers.

Admittedly I use quality inks that cost around $300 a litre, and each machine runs 6 inks, so that’s 12 x 1 litre bottles alone. Recently I needed to replace a motherboard and several heads. I confessed to those present that so far this calendar year I’ve spent over $12,000 on maintenance. Its not something that the sales folk that sell them focus on either.

I also pointed out to this ‘clown’ that if I was not making a reasonable margin, I’d not be able to pay the bills, and I’d be out the backdoor in no time.

I suggested that he go home and tell his mate that if he wants to be a cheap sign maker, that’s his choice. But, I suggested if he wanted to be a reputable sign maker, he should pull his head out of the sand, do his homework and stop looking at the day to day money in his pocket.

I must confess that I was showing my annoyance in the tone of my voice, but his peers got the message. After he had left, most in the room thought his mate was a fool too.

Thing is though, I have spoken to a few in the industry that have not got a clue as regards the costs to maintain machines, no idea how to work out running costs, or any idea of how to make a decent margin.

It seems a crime by some that our industry actually make money.

I’m not saying that some out there aren’t overcharging too. We don’t know their overheads, so what is overcharging to us may be what they need to make ends meet. I know one sign shop though that buys pull up mechanisms in bulk from China and lands them for about $12, and they use a really cheap garbage polyprop material at about $3 a metre. It probably costs them about $25 in ink and materials, yet they charge $395 for the end product, not including artwork.

Overcharging? In my opinion, yes, but there is a school of thought that ‘buyer beware‘ and if the clients don‘t do any homework, then they deserve to get burned. I‘m not sure I agree with that, but I understand the sentiment. Market forces will ultimately dictate what we can sell our services for, but these companies that blatantly overcharge or undercharge, damage the industry in the long term.

Then of course we have these ‘cowboys’ that live day to day, wreck the market for the rest of us, go broke owing the wholesalers and then make it harder for the rest of us to get the prices back up to where they should be to make an honest living.
 
End of the day, I don’t actually have a problem with having competition. But, is it wrong to wish that competition was professional, honest or, at the very least, educated?

Let me know your views.

Shane Drew

www.dsi.net.au
[email protected]