22 Aug Signage Pricing Fundamentals Every Procurement Manager Should Know
So, you thought that you’re just buying a signage, and the the lowest initial cost is all you need to consider. But smart procurement managers take their thinking just a little bit further – and come up with an entirely different conclusion from the one they’d reach if they just looked at absolute cost.
The secret to evaluating quotes for signage lies in digging down below the superficial price. What you need is a detailed cost analysis that will cover the entire life-cycle of the sign.
What is Total Cost Of Ownership?
Total Cost Of Ownership – Signage
Total cost of ownership differs from absolute cost. Let’s look at a simple example.
When you buy a car, you don’t just pay for the motor vehicle in question. You also have to consider things like maintenance costs and servicing costs. So, the BMW you like the look of also carries with it the cost of regular services at agent prices. And the tires you need to buy to keep the wheels turning will probably be more expensive than those of a Nissan or a Toyota.
As a result, the cost of a BMW is not only higher than that of the Toyota when you buy it, but also when you maintain and service it. Of course, if you simply love the car, that won’t weigh with you, but if you were to think in terms of cost-effectiveness instead of passion, you’d go for the Toyota.
The total cost of ownership is therefore the Purchase Cost + Maintenance Cost + Operating Cost.
You also have to think about the length of time you plan to use that car. Does your dream BMW last as long as the practical Toyota? We wouldn’t hazard a guess on this, but you can see where it’s gong. The longer it lasts, and the less it costs to maintain and run, the more cost-effective your car will be. If value for money is your primary concern, the Toyota will probably be the winner!
So, how does this relate to signage?
Evaluate and compare your Signage options
Signage comparison example
Just like cars, signage also needs maintenance and servicing. An illuminated sign just looks tawdry if half the lights are out, and dust and dirt won’t make your sign look appealing either. As your best and most visible brand ambassador, your signage deserves a little TLC to keep delivering the message you want to convey.
In the table below, you’ll see an illustration of the Total Cost of Ownership for signage. Sign two is clearly way cheaper than sign one – at least when it comes to initial outlay. But just look at what happens as we start adding on the extras that go with cost of ownership.
Assuming you’re not a fly-by-night and aim to be in business for more than the three years sign 2 can tolerate, you’ve already equalled the initial cost by the time you reach year nine and have replaced sign two or three times. That’s without basic maintenance that keeps your sign looking as smart as you want your business’s image to be.
Let’s suppose something goes wrong. What does the warranty cover? Sign one has a warranty of three years. If there’s any problem during that time, you don’t have to cover the cost, but sign two doesn’t give you that three-year warranty. Any costs after three months are entirely for your account. In this respect, the table below is conservative in its cost estimate, because it assumes your sign will be just fine.
As we can see from the cost of ownership analysis above, sign two may seem cheaper at the outset, but its ultimate cost over a period of ten years is a great deal higher than the more “expensive” sign one. So, which is the smart choice? The answer seems obvious.
Wise investment means looking at a great many factors, and cost of ownership is one of these. When choosing signage for your business, it makes sense to take the lowest cost option – provided you have also taken cost of ownership into account. After all, it’s the sensible thing to do.
At Adventrix, we’ll explain your signage options in detail – and we’ll give you the high and low road options with all the unbiased facts. Absolute honesty is what you can expect, and absolute quality is just what we do. Yes, we can help you with low-cost signage, but before we finalize your order, we’ll give you the information you need to evaluate cost of ownership.
We do guarantee our signage, but we can only guarantee the lowest-cost options for as long as we expect them to last. Truly high-quality signage may cost more to begin with, but before long, you’ll find that it pays for itself in terms of maintenance, servicing, and replacement costs. When you deal with us, you get the facts.
After that, the choice is yours, but at least it will be an informed choice. Adventix’s clients know what to expect from their signage – that’s why we’re trusted by top businesses around the UAE. Will your business be next?
Our expert consultants are at your service, so why not get in touch today?