32 minutes | Sep 28th 2020

Producing In-House - RD231

Are you producing any of your design projects in-house?

I got the idea for this episode of the podcast when a member of the Resourceful Designer Community shared her new toy with us in our Slack group. Laura bought a Roland VersaSTUDIO Desktop Sign Maker BN-20. It’s an eco-solvent printer she plans on using to produce stickers, vehicle graphics and apparel graphics, among other things.

This new piece of equipment will allow her to produce materials for her clients in-house. She also plans on using it to make pieces to sell through her Etsy shop. This got me thinking about different ways designers can produce things in-house.

Now for the record, I don’t produce anything in-house myself. I had the opportunity years ago, which I’ll share with you a bit later, but I chose to focus my time solely on the design part and not production. But if you’re into it, producing in-house can be a very lucrative income stream for your design business.

Years ago, a designer I knew lost her job and opened up her own home-based design business. When I later ran into her, she told me getting laid off was one of the best things to happen to her. She had purchased special equipment and was now serving clients she loved and happily producing printed materials for them in-house. Items like posters, business cards, postcards and wedding and party invitations,

That was my first exposure to the idea that a home-based graphic designer could also produce material in-house.

When I started my home-based design studio, an office supply representative offered me a high-end office copier for zero dollars. All I had to do was agree to purchase copier toner through him and to pay a small fee of $0.12 per sheet printed on the machine.

The offer was very tempting. But then I started thinking of the time involved running the copier, cutting, folding, and everything else involved with producing in-house, and I decided it wasn’t for me. I prefer to do the design part and let others handle the production part even if it costs me more to farm out these projects.

But many designers love producing their materials. And not just sheets of paper.

Home-based designers can produce things such as:

  • Stickers/decals
  • Heat transfers for garments and apparel
  • Posters
  • Banners
  • Vehicle graphics
  • Foil stamping
  • Laminating
  • Embroidering
  • Die-cutting using circuit makers
  • Screen printers
  • Block print
  • Letterpress
  • 3D printing

There are so many options you can choose from. It might be hard to decide what sort of products you want to produce in-house.

What if you can’t afford the equipment?

What if you can’t afford the equipment required for producing in-house? It might be easier than you think to acquire them.

New equipment is a tax expense.

Keep in mind that any equipment you purchase for your business claimable on your taxes as a business expense. Check with your accountant to find out how to claim the equipment.

Purchase second hand or refurbished.

Second hand or refurbished equipment can often be just as good as purchasing new, except you pay much less. There’s always someone out there selling old equipment. It’s just a matter of looking.

Purchase floor models or demo units.

As new models of equipment are released, stores and distributors must sell their current inventory to make room. These units are often available at great sale prices. But for a more significant discount, ask if they have a floor model or demo unit for sale. These units have minor usage and often come with the original warranty.

Look for grants or low-interest loans to fund your purchase.

Ask your local economic development group or business centre if they know of any grants or low-interest business loans available for small businesses wanting to expand or purchase equipment. You may be surprised at the amount of money available for anyone who knows where to ask.

Grants are great because you don’t have to pay them back. But they often require a lot of paperwork and jumping through hoops to get. But free money may be worth the hassle.

And some “expansion” loans for small businesses are available at 0 or very low-interest rates, which allows you to purchase equipment and pay it back over time.

Open a line of credit.

If you qualify, a line of credit is a good option for purchasing new equipment.

Lines of credit often have much lower interest than loans or credit cards. Most, however, do require collateral to secure them. They’re easier to get if you’re a homeowner and not a renter.

Incentive from seller

Lastly, contact the seller or distributor of the equipment you want and see what sort of deals they can give you. As I said earlier, I could have had a high-end office copier for zero money. All I had to agree to was purchasing the toner through the supplier and a fixed fee per copy.

If you can convince a supplier you’ll be purchasing enough supplies through them; they may offer you a great deal on the equipment.

Producing in-house: Pros and Cons. Pros of producing in-house
  1. You can make better profits compared to farming out projects.
  2. You can compete better by charging lower prices than your competition.
  3. You control the entire process from design to production.
  4. You can produce projects much faster than farming them out.
  5. Make extra money by producing for other designers.
Cons of producing in-house
  1. The equipment takes up space in your house.
  2. You need room to store supplies.
  3. You must make sure you have supplies on hand to produce projects.
  4. Equipment can be noisy and interfere with your family’s life.
  5. You are responsible for repairs should the equipment break down.
  6. Producing in-house is time-consuming.

I made the decision years ago that producing in-house was not something I wanted to do. But I’m not you. Maybe this is just the thing you need to expand your design business and take it to the next level. This might be the niche that will set you apart from your competition.

If you think producing in-house is something you would like to do, then look into it.