Embroidery setup fees: how much to charge and when to waive it

Charge a one-time setup fee that covers what your digitizer charges you plus the time you spend managing the file, and size it to the design: I charge $30 for a logo up to 7.5 inches, $50 for anything bigger, and $25 for a handwriting design. The fee comes off only when there is nothing to set up, which means a reorder of the same design, lettering in a font you already own, or a customer file that runs clean on your machine.

This guide is about the number on your customer's quote. If you are still deciding whether to digitize yourself or send the work out, start with digitizing: learn it or outsource?, which covers what the work costs you. This guide covers what it should cost your customer.

How much should an embroidery setup fee be?

Start from your own cost, then look at the market to see where you land.

My digitizer's published price list charges $16.99 for a cap or left-chest design up to 7.5 inches on a two-day turnaround, and $32.99 as a starting price for jacket backs or anything over 7.5 inches. My fee is $30 on the small ones. That leaves $13.01 for the time it takes to send the art, check the file, and run a test piece, which is real work and deserves to be paid.

Commercial shops publish higher numbers. Corporate Casuals charges a $35 one-time setup fee, and Lantana Embroidery starts at $35 for simple designs under 5,000 stitches and charges $50 for most chest logos. So a home shop at $25 to $35 for a left chest is not overcharging anyone. It is at or below the going rate.

If you digitize your own designs, you have no invoice to start from, so price your time instead. The digitizing fee calculator will walk you through that and show where your number sits.

Why does a bigger design cost more to set up?

Because it costs you more. The same price list that charges $16.99 for a left chest charges at least $32.99 for anything over 7.5 inches, and it adds that "prices may vary according to complexity." Charge $30 on a full back and you have lost money before the machine turns on.

I learned this the first time a back design came in. My $30 fee had only ever been tested against left-chest work, and on a back design it went underwater. Now anything over 7.5 inches is $50, which leaves room for the complexity the digitizer warns about and still sits inside what other shops charge. Lantana, for example, charges larger designs by the thousand stitches instead of a flat fee.

So before you quote a setup fee, ask one question: is the design over 7.5 inches? The answer picks the number.

Is handwriting different from a logo?

Price it separately. A handwriting design is a photo of someone's writing, often a note or a signature from a family member, turned into a stitch file. My handwriting fee is $25. It gets its own line so the customer sees exactly what they are paying for, and it is still charged once per phrase.

When should you waive the setup fee?

Only when there is nothing to set up. There are three honest cases.

The first is a reorder of the same design, and every shop agrees on it. Corporate Casuals says future orders using a logo that was already set up are not charged again, and Crestline waives the setup charge on a reorder when the artwork has not changed. The file exists, so the customer already paid for it. Charging again would be charging twice for one piece of work.

The second is lettering in a font you already own. A name, a monogram, or a team name typed in an embroidery font is not digitizing. An embroidery font is a set of pre-digitized letters you type out with your keyboard, so a new name takes minutes and costs you nothing. Charging a setup fee for it is the kind of thing customers eventually figure out.

The third is a customer file that runs clean. A customer who brings a stitch file from another embroiderer has already paid for the setup once. Lantana's FAQ says a .dst from a previous embroiderer can usually be used, and "usually" is the important word. Run it on a test piece first. If it stitches clean, there is nothing to set up. If it needs fixing, the fix is digitizing and the fee applies.

When should you never waive it?

Do not waive it as a discount. Taking the setup fee off to win a big order, to be nice to a friend, or because the customer pushed back does not make the digitizer's invoice go away. You pay it either way, so a waived fee just moves that money out of your pocket.

If the fee feels heavy on a small order, the real answer is that it is heavy, because the setup costs the same for one shirt as it does for fifty. The one-piece pricing guide goes through that math. On a bigger order, the fee spreads across every piece, and that is the honest quantity break.

Two changes also count as a new design and get a new fee.

• Changed artwork. A new color layout, a new element, or a redrawn logo is new work. Crestline's reorder waiver only applies when the artwork has not changed.
• A new size. A stitch file is built for one size. Embroidery Hoop Store's resizing guide limits a machine file like a PES or DST to about 10 percent up or down before the density goes wrong. A left-chest logo blown up for a back is a new file, and it is over 7.5 inches, so it gets the bigger fee.

How do you explain the setup fee to a customer?

Call it a setup fee, not a digitizing fee. Most customers have never heard the word digitizing, and a fee they do not understand is a fee they argue with. Then say the part that makes it easy to agree to: it happens once.

Here is how I put it on a quote:

There's a one-time $30 setup fee to get your logo ready for my machine. You only pay it once, so every reorder of this design skips it!

The promise in that sentence also gives the customer a reason to come back to you. At a new shop, they pay setup again.

Put the fee on its own line. If you bury it in the shirt price, a reorder looks like a price drop and the next new design looks like a price hike, and neither one is true.

What about a big design where you don't know the stitch count yet?

A large design is where a guessed price hurts most, because the stitch count on a full back can swing a long way and you cannot know it until the file exists. The fix is to quote in two steps: charge the setup fee first, get the design digitized, then price the pieces from the real stitch count.

That is how I quote a back design now, and it is built into Broidry. In the quote builder, a switch called What this quote covers has a Digitizing only choice, which charges your setup fee and nothing else. Your shop minimum does not apply to it, because it is half of an order. Once the file comes back, you put the switch on The whole order and price the pieces. The setup line stays on that second quote, and whatever the customer already paid comes off the total, so nobody pays setup twice.

How do you keep track of who already paid?

A reorder only skips the fee if you can prove the design was set up before, which means finding the file and the order it came from. If the file lives in an unlabeled folder on one laptop, the reorder starts with a search. The guide to organizing embroidery design files covers a system that holds up.

In Broidry, your logo fee and your handwriting fee live on your rate card, and the setup line on every quote reads "One-time — not charged on reorders of the same design," so the customer sees the promise in writing. When you reorder a past order, the linked design comes along with it. If your rate card holds one setup number but you charge more for big designs, add the bigger one as your own fee on the rate card and tick it on the quotes that need it, with the regular setup set to none so the two do not stack.

For how the setup fee fits with stitching, hooping, and the blank, see how to price machine embroidery.

The short version

Price your setup fee from what digitizing actually costs you, plus a fair amount for your time. For me that is $30 up to 7.5 inches, $50 over it, and $25 for handwriting. Charge it once, on its own line, and call it a setup fee. Take it off only when nothing needs setting up: a reorder, lettering in a font you own, or a customer's file that runs clean. Never take it off as a discount, and treat changed artwork or a new size as a new design.