Embroidery is much different than any type of print decoration method for several reasons. The artwork must be setup differently, the products are different, and the decoration material costs are quite different. Whether you are thinking about purchasing an embroidery machine to use in house or plan on outsourcing the decoration method it is important to know where the costs come from. As you will learn, it is not the thread that makes embroidery one of the more expensive decoration processes.
The first cost associated with embroidery is setting up the artwork. This is the most important part of the embroidering process, and is done by converting the artwork into a digitized sewing file format. Digitized artwork tells the embroidery machine where to sew, how many stitches to sew, and how dense the stitching should be. The quality of the digitizing will determine the overall quality of the finished product. It is important to note not all products are digitized in the same way, and any good digitizer will ask what the artwork will be sewn into before digitizing. Hats, for instance, are sewn inside-out since they are round, while most garments are stitched left to right. Since it can be complicated, digitizing artwork can cost anywhere between $25-$75 dollars, depending on the complexity of the artwork. Most online design tools, however, have fonts and some other designs already in sewable formats, thus allowing the customer to avoid digitizing fees.
In order to digitize artwork it must be a vector file, which makes sense if you think about it. Bitmap images are made up of tiny pixels, which would be impossible to stitch. The smooth lines and curves of a vector imagine can much more easily be sewn. Even though the artwork starts out as a vector image (which resizes much more smoothly than bitmap images), once it has been digitized it cannot be resized. In order to resize the original must be digitized to the new size. This is because the embroidery machine cannot simply lay larger stitches, it must lay more stitches. A typical left chest print will contain approximately 6,000 stitches. That may sound like a lot, but that amounts to less than a dollar of material costs.
It is important to help your customer understand what digitizing is, and why it must be done. Some customers have a hard time paying $25 to have their logo digitized so it can be sewn into just one or two products. Whether the design is going to be sewn into 1 or 1,000 products it must be digitized. It is wise then to look at the costs as more unit-based when considering how many products the design will be sewn into. If a customer just wants one polo embroidered with their logo or design, then they are going to have around a $25 digitizing fee that will make the product look extremely expensive compared to the same fee being applied to an order of 25 polos where the cost is spread more evenly across multiple products. If the customer pays to have their logo digitized, then it is important to provide them with the file. Providing them with the file does give them the ability to go to someone else to have their embroidery done, but they paid for it and should own it, just like if they outsource their logo to be vectorized.
The material costs are the real reason why embroidery can be so profitable. Thread is significantly cheaper than any ink used in one-off decoration printing (DTG & Sublimation). Thread used by embroidery machines comes on large cones or spools. Cones contain far more thread than a bobbin, but the bobbins supply thread to a different part of the machine, so embroiderers will need both. Additionally, you will also need to purchase the stabilizer. Customers typically are not big fans of stabilizer, but it is essential to the structure of embroidery. Just like thread, stabilizer is extremely inexpensive. The last common material cost to consider is needles. They will break from time to time, so it is important to have backups available.
As far as material costs go, that is about all there is to embroidery. The majority of the costs for embroidery revolve around the time it takes to sew a design. While the material margins are extremely high, the capacity of an embroidery machine is much lower than any other decoration method. An automatic screen printing press can print a few hundred shirts in an hour (same design), a DTG printer can do around 40 prints (different designs), while an embroidery machine can only sew around 4 unique designs in an hour. Nevertheless, when you couple low material costs with the ability to digitize in-house (or low-cost outsourcing), embroidery quickly becomes one of the most attractive options in the product decoration industry.
