How to Price Contract Embroidery on Customer-Supplied Garments

By the creator who built EMBquote

Short answer: when the customer brings the garments, you charge for decoration only. That means your normal rate per 1,000 stitches on the design, plus setup or digitizing if the design is new. On top of that, add a handling and liability fee, per piece or as a flat order fee, and a minimum order fee so small runs still pay for their setup time.

What contract embroidery is

Contract embroidery is work where someone else supplies the blanks. It's often a screen printer, an ad-specialty company or another decorator who sends you their garments to sew. You never sell the shirt or the jacket, so there is no garment markup in the quote. Everything you earn comes from the decoration and the fees around it.

The hidden cost: risk on goods you don't own

When you supply the garment, a ruined piece costs you its wholesale price. When the customer supplies it, a misframe or a thread break in the wrong spot on an expensive jacket, or on something that can't be replaced, may be a replacement you have to pay for. You're also receiving, counting and inspecting goods you didn't sell. Your contract price has to cover that work and that exposure.

The four parts of a contract embroidery quote

1. Decoration price. Use your standard per-1,000-stitch matrix on the design's stitch count. This is your core revenue. If you don't have a matrix yet, start with our guide to building an embroidery price chart.
2. Setup or digitizing. Charge it the same as on any job, unless the design is already on file. Show it as its own one-time line.
3. Handling and liability fee. Charge per piece or as a flat order fee. It covers receiving, counting, inspecting and the risk of damaging supplied goods.
4. Minimum order fee. Small contract runs still use the same setup and hooping time, so a minimum keeps them from losing money.

Put each location on its own line

A left chest and a full back are different jobs, even on the same garment. Give each decoration location its own line with its own stitch count and rate lookup, plus any per-position hooping fee you charge. A back can be several times the stitches of a chest, so don't quote it as the chest plus a little more.

Write the terms on the quote

Because the goods aren't yours, put your rules where the customer sees them before they approve. Say how many pieces you expect, what happens if the count is short, and how you handle a damaged piece. Clear terms on the quote prevent arguments after the job runs. If the customer changes the order later, revise the quote rather than adjusting the price by memory; our post on quote revisions and discounts covers how.

A quick check before you send it

• Is there a garment line on the quote? There shouldn't be, or it should be zero because the customer supplied it.
• Does each location have its own stitch count?
• Is setup shown, or noted as already on file?
• Is the handling fee there, per piece or flat?
• Does the order clear your minimum?

How EMBquote handles contract work

EMBquote's quote wizard has four ways to quote: embroidery, screen print, transfers, or contract decoration on garments your customer supplies. The customer-supplied path skips the catalog markup step, since there is no SanMar or S&S blank to mark up, and quotes decoration plus your handling rate. You don't have to zero out a garment line in software that assumes you always sell the shirt. The finished quote is pushed to QuickBooks Online as an estimate.

Want to check the stitch math first? Use the free embroidery calculator. To quote contract jobs in EMBquote, Pro is free for 14 days (credit card required up front), then $149/month early-bird ($299/month regular). See pricing, or read more on the EMBquote FAQ. Questions: hello@embquote.com.

FAQ

What is contract embroidery?

Contract embroidery is when a customer, such as a screen printer, an ad-specialty company or another decorator, brings you their own blank garments and pays you only to embroider them. You sell the decoration, not the garment.

How do you price embroidery on customer-supplied garments?

Charge for decoration only: your normal per-1,000-stitch rate on the design's stitch count, plus setup or digitizing if the design is new. Then add a handling and liability fee, per piece or as a flat order fee, and a minimum order fee for small runs.

Why charge a handling fee on customer-supplied goods?

You receive, count and inspect goods you did not sell, and you carry the risk of ruining them. A misframe on an expensive jacket the customer supplied can be a replacement you have to pay for, so the fee covers that work and that risk.

Should contract embroidery cost less than embroidery on garments I supply?

The decoration rate can stay the same, but there is no garment markup, so the order total is usually lower. That makes the handling fee and the minimum order fee more important, because they are what protect your margin on small or risky jobs.

Can EMBquote quote contract embroidery on customer-supplied garments?

Yes. Contract decoration on garments your customer supplies is one of the four ways to quote in the EMBquote wizard, alongside embroidery, screen print and transfers. That path skips the catalog markup step and quotes decoration plus your handling rate, so you don't have to zero out a garment line.