Most know how to sell, a lot know how to produce, but selling and producing alone don’t equate to profit in business. Calculating costs and having a general profit strategy is essential for making money. When it comes to screen printing, we break it down by number of colors and pieces in the job; embroidery is priced in number of stitches. These tangibles can be associated to cost. But what about heat transfer?
As always, there are a myriad of factors that go into calculating costs with this decorating discipline. Depending on the transfer technology, it can range from square inches of material consumed, ink costs per square inch or even minutes per produced garment.
Using the workflow to create print-and-cut digital transfers as an example, let’s explore the steps and potential costs involved.
Print—Load the digital media of choice into a large or small format solvent printer and send the design to print.
The cost of raw materials and the time it takes to print the graphic are the two main considerations when it comes to figuring out what it costs to print a full-color heat transfer graphic. (All images courtesy the author)
Cut—Once the design is printed it must be cut in order to transfer. Some machines have an integrated print/cut feature, others necessitate loading to a separate cutter.
Weed—Weeding is the process of removing the excess film away from the carrier. Depending on the complexity of the design, this process can take anywhere from 30 seconds to five minutes per graphic.
Mask—If the design is digitally printed on a white, opaque media for application to a dark-colored fabric, masking is a must. Similar to applying transfer tape to a sign, the heat transfer mask should be hand laminated to the digital prints or run through a cold laminator for higher quantities.
Heat apply—Apply the completed digital print to the product of choice for the recommended time and temperature at the proper applied pressure.
Potential print pricing
There are two main considerations when it comes to figuring out what it costs to print a full-color heat transfer graphic: the cost of raw materials and the time it takes to print the graphic. With a number of ways to assess raw materials costs, the scope of the job will greatly influence that decision.
Weeding is widely recognized as the most time-consuming process for creating garments with any heat-applied film.
The labor to apply mask is very minimal when compared to weeding, and most shops will roll this into the weeding step and time averages.
Most material manufacturers will sell the printable film in a roll and price it by the yard. If the design will use a full yard of material, then calculating costs can be easy. You will know your cost per yard from the manufacturer and can simply add the shipping charge over the roll price to cover bases. However, one of the main advantages to printing digitally on a printer/cutter is the ability to “gang” multiple smaller jobs to make one large job. This means costing by the square inch.
To calculate the square inch cost, take the width of the material and multiply it by the length of a yard (36"). For example, a 20" wide heat transfer material would yield 720 square inches by the yard (20" w X 36" l=720 square inches) Then, take the cost per linear yard—in this case we will say it’s $7.20 (including shipping)—and divide it by the number of square inches to get cost per square inch. In our scenario it’s $0.01/square inch.
The other raw material is the ink being printed. Based on usage reports available in your RIP software, you will find that the average ink cost per square inch is $0.001. (We also need to consider the mask, which we’ll account for in step four.) Adding these up, our raw materials in the print step come to $0.011/square inch. Now all we need to know is the number of square inches in our graphic to calculate the cost per transfer in this first step. Let’s say our design is 8” X 8” or 64 square inches. Multiply 64 X $0.011 for a beginning print cost of $0.704.
Dollars in time
The next consideration in the print it step is the time in tied-up equipment. One way to look at this is viewing equipment as an employee. One expects an employee to be productive, and in return for their productivity, the employee expects to be compensated. You have already made the capital expenditure, and whether financing the machine or paid in full, make sure to factor that expense into the cost structure. Likewise, allocate a cost to cutting equipment. If it’s an integrated unit, then one figure will suffice.
The weed it step involves labor dollars. Weeding is widely recognized as the most time-consuming process for creating garments with any heat-applied film. The complexity of the design greatly affects the time consumed in the weeding step. The best way to calculate cost for this step is to assign an average value in minutes to each type of design. A breakdown of complex and simple should suffice with additional time estimates for highly complex.
If something goes wrong in the heat press process, then all labor, material and garment costs are lost, so it’s critical to execute this step properly according to the media recommendations.
Based on a recent survey of 200 respondents, weeding times ranged anywhere from 1–2 minutes for simple designs and as much as 5 minutes for complex designs. Complete a quick study of average weeding times for your labor and calculate weeding labor per design accordingly. For instance, an employee that makes $10 per hour to complete the task of weeding gets paid $0.17 per minute. ($10/60min = $0.167) That equates to $0.17–$0.34 per simple design or as much as $0.85 for a complex design. Obviously reducing time in weeding will increase profitability, so look for ways to gang designs to make weeding more efficient and speed up operators, and hold onto those employees who complete the task efficiently. Also, consider sourcing media types that improve production efficiencies without compromising finished result goals.
The masking step is unique in that there are two calculations: the cost of masking material and labor. The labor to apply mask is very minimal when compared to weeding, and most shops will roll this into the weeding step and time averages. A good estimate would be that masking takes about 10 percent of the time it takes to weed, so we can average 10 percent of the final cost.
The material factor is also a square-inch calculation similar to the cost of print media. A yard of mask is sold in 20" widths as well, so the yield is 720 square inches. At a landed cost of approximately $3.20 per linear yard, the mask expenses (3.20/720) equal $0.0044 per square inch. Multiply by 64, and the cost to mask the 8 X 8 design would be $0.28 per piece. Some transfer masks are reusable, so thrifty shops stand to reduce this total by half with careful planning.
The final step in the process, and perhaps most important is the heat application of digital transfer to garment. If something goes wrong in the heat press process, then all labor, material and garment costs are lost, so it’s critical to execute this step properly according to the media recommendations. Most print/cut digital transfer media applies in a single step for 8–15 seconds. When loading the garment, positioning the print and completing the application, an average time of 1–2 minutes per location is standard. The most efficient heat press operators can complete as many as two garments per minute. Following the simple labor calculation of $0.17 per minute (based on a $10 hourly rate for the heat press operator), expect somewhere around $0.17–$0.34 per piece.
Here is a look at the final costing info for this 8" X 8" design:
Heat Transfer Media and Ink = $0.704
Weeding Cost = $0.17–$0.34
Masking Material Cost = $0.28
Masking Labor Cost = $.017–$.034
Heat Press Labor Cost = $0.17–$0.34
Total Decoration Cost = $1.34–$1.70
This total cost will need to be added to the cost of the blank garment and marked-up thereafter for resell. When considering digital transfer technology, it’s not fair to just look at this cost and compare with other technology types that aren’t as versatile. Consider that this 8" X 8" decoration can be applied to all colors and styles of T-shirts, bags, jackets, performance apparel (including stretch fabrics), athletic jerseys, umbrellas and much more.
Calculating accurate costs, having an idea of expenses each process entails and running different decoration scenarios across design types and garments will help to make maximum profit. Now that we have an understanding of the costs that go into creating a digital transfer, stay tuned for next month’s issue, where we’ll look specifically at where these heat transfers fit in with screen and direct-to-garment printing when it comes to selecting one for a job.