How to Start Your Own Embroidery Business

Starting an Embroidery Business?
Also click here for more info on starting your business.

So you are thinking of buying an embroidery machine?

Working for yourself can stimulate your creative talents and be incredibly rewarding while allowing you to work from home keeping those overheads to a minimum.

Among today’s many home or small business opportunities, the embroidery business offers entrepreneurs like you, a tremendous career in a booming industry.

More and more corporate dollars are pouring into promotional products, fueling the embroidery business. Sporting organization’s use embroidery on their garments and bags.

Just think about it, every company, store, organization or cause is a potential customer for your embroidery business!

Plan promotions ahead of time:
January
  White sale, ski equipment, sweaters, turtlenecks, winter wear
February
  Washington’s Birthday, Lincoln’s Birthday, Valentine’s Day
March
  St. Patrick’s Day, Easter wear, baby items
April
  Luggage promotion, canvas tote bags, team uniforms, school fund Raisers.
May
  Mother’s Day, robes, aprons
June
  Graduation, wedding, Father’s Day (men’s shirt and tie Monogramming)
July
  Beach wear, towels, terry robes
August
  Back-to-school, totes, backs packs, school jackets, baseball hats
September
  School and church fund raisers
October
  Halloween
November
  Linens for Thanksgiving and the Holidays
December
  Time to have customers thinking about Christmas gifts

Annual:
Corporate Accounts
  Product launches, promotional items
Local Businesses
  Employee work wear
Sports Teams
  Team strips, Baseball caps, Merchandising items
  This is just a tiny selection, there are hundreds of thousands of possibilities!

Markets to consider:
Ad Specialty Firms Air Shows
Amusement Parks Animal Shows
Bands Bath & Linen Shops
Car Clubs Casinos
Children's Clothing Concert Promoters
Hotels, Interior Decorators Little League Teams
Local Bar & Restaurants Schools
Ski Resorts Sporting Goods Stores
Summer Camps Uniform Companies

What can I sew on:
Aerobics Wear Aprons
Award Ribbons Bath Sheets
Blouses Car Mats
Christmas Stockings Coat Linings
Dancewear Dog Collars
Golf Bags Jackets
Monogram Shirts Name Tags
Pillow Cases Robes
Sweat Suits Towels
Uniforms  

10 Steps to Embroidery Success

A successful new embroidery business requires a number of ingredients that you can control; your hard work, your creativity and your choice of equipment/distributor. But before you start embroidering your first garment, you will need to review a few important steps.

1. Planning your business:
Creating a blueprint (business plan) for your business is the foundation for your success. You need to set goals and establish benchmarks for your growth. Over time, you’ll find out what the market demands of you and how you’ll fit in. Embroidery shops come in all sizes, from a small home business to giant production factories.
You’ll need to decide what type of shop is right for the type of business you want to do.
Good planning will help you establish a strong foundation for continued growth and success.
Remember, “Failing to plan is planning to fail”

2. Target the Market:
You will need to learn about the competition and decide how you can be different. You’ll need to find your niche and locate potential customers. You can do this by checking the yellow pages, Chamber of Commerce, finding resources at the library or on the Internet. Once you have found potential customers, you will need to develop a marketing plan to sell your talents.


3. Select the right machine:
More equipment options are available today than ever before. Developing a relationship with a full service distributor that has a complete support network to help your business grow. We at International Machine Group have this experience.

4. Selecting software:
You want a package that is user-friendly, yet has enough features and capabilities to help you get the job done on time. Depending on the level of software you choose, you should be able to do everything from sewing monograms and lettering to creating sophisticated and colorful designs. Look for software that you can build on as your expertise grows.

5. Financing equipment:
Where do you go for money? Your savings or your family and friends? Do you borrow money from your bank, or find out if you qualify for a SBA loan? We have a leasing company we work with but the best source of finance is generally your own bank with which you have history and they usually offer you the best rates.

6. Training:
A key component of your success is training, training and more training. You can never learn enough about the latest trends, software, materials and machines. Quality education from a distributor should be comprehensive and include more than just machine and software training, they should offer you on-line support too.
Seminars can help keep you up-to-date with all of the latest industry developments and offer you a great opportunity to network with others in the business.

7. Finding the best supplies:
You want to provide clients with the best possible finished products. Your hard work, top-level machinery and intuitive software will help you get there. But, supplies and accessories will make your work shine. You need to use top quality threads, needles, backing, and all the other items from a full-line supplier. International Machine Group will give you a list of suppliers.

8. Customer service:
Once you have a customer, make sure you service them to the best of your abilities. Walk them through a project, use quality materials, and deliver on time. Be their counselor, their advisor. After all, you now know the embroidery business. Make sure that you are the expert they turn to every time for all of their embroidery needs.

9. Make the business grow by finding new opportunities:
After you have established your business, continue to think about expanding it by finding new customers or offering new services perhaps laser engraving or screen-printing.
If you begin as a home-based operation, you may expand to a small kiosk in a mall or a storefront. Each location is different and the customers of each expect different services. Whatever course you select, use every tool available to seek and secure new business. Make sure you are dealing with a distributor who will be there with you for the long run. Make sure that they have the ability to truly help you as you expand your business.

10. Upgrade you business:
Whether or not you move from a home-based business to a large factory or anything in between you will want to expand your business. To be successful, adding machinery will be necessary to handle larger and more complicated orders. Whether it is a single head, four head or even a 16 head, International Machine Group is the partner you can trust.



Retail / Home Production Cost Analysis
  Number of Heads
Cost 1 2 4 6
1 Day Labor ($9.00/hr. x 8 hours)
$72.00 $72.00 $72.00 $72.00
Average machine cost with software
$12,500 $18,500 $26,500 $35,500
Monthly Payment (60 months @ 10%)
$266 $393 $563 $755
Daily Payment (Monthly payment / 30 Days)
$12.09 $17.86 $25.59 $34.31
Daily Labor + Machine Payment $84.09 $89.86 $97.59 $106.31
 
PRODUCTION
1 2 4 6
Time it takes to sew an average design. (6,000 stitch pattern 3-colors @ 700 stitches per minute) The average corporate logo will be about 3000-5000 stitches. Top machine speed is usually 1200 stitches per minute. Time is allotted for re-loading the garment onto the machine and the extra time it takes for the machine to trim the thread and change colors.
9.6 min 10.1 min
10.6 min
11.1 min
 
RESULTS
1 2 4 6
Total items produced in one day. (420 minutes (7 hours) divided by time for 1 item) 43.75 83.16 158.48 227.00
Production Cost/Item (One days operation cost divided by items produced, including .04 per item for thread & backing) $1.96 $1.12 $0.65 $0.50
 
Retail Pricing 1 2 4 6
Embroidery Profit (6000 stitches x .80 per 1000 x daily production less production cost) Retail pricing will vary depending on location and customer. We took a good average of this criteria and came up with .80 per 1000 stitches.
$124.25 $306.02 $657.69 $976.10
 
Total Daily Profit
1 2 4 6
With garment profit: Hats $554 $1,136 $2,237 $3,246
Cost = $3     Retail = $13                        Profit = $10 + Embroidery
With garment profit: Polo Shirts $812 $1,634 $3,185 $4,608
Cost = $8     Retail = $24                        Profit = $16 + Embroidery.
With garment profit: Jackets $1,285 $2,547 $4,923 $7,105
Cost = $28   Retail = $55                       Profit = $27 + Embroidery.

Note: Above garment profits will be reduced for large orders and/or to compete with other embroiderers.

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