What Is a Cutting Fee?
A cutting fee is usually some charge per yard of fabric required to complete a project. Some upholstery shops charge that fee when a client provides their own fabric (known as 'C.O.M.' or Customer's Own Material).
Some shops add cutting fees to offset the revenue they lose when you bring in your own fabric. That is the short answer. Not all shops add a C.O.M. fee.
"Joe" emailed us expressing his dismay about being charged a cutting fee from another shop. He had shopped heavily for the best reupholstery labor rate and had a quote of $750. He needed 20 yards of fabric, which would be priced when he selected one from the shop's sources.
He sourced his own fabric from an online store. And then flipped out when he learned the upholstery job would now cost $1050. The extra $300 came from a $15 per yard cutting fee for 20 yards of C.O.M. fabric.
Joe's question of "Why?" leads to the differing approaches upholstery shops take with pricing.
Upholstery Shop Pricing Models
1. Labor Only
These shops do not want to mess with fabric. They aren't dealers for any fabric resources and don't offer any preferences. They are most often 'to-the-trade' only shops catering to interior designers and contractors who generally provide their own fabrics anyway.
Their labor rates tend to be higher, because it is the only source of revenue offsetting their fixed and variable costs. Many of these shops would not deal with 'Joe', because he is not a regular (read: repeat) account.
2. Labor Plus Retail Priced Fabric
These shops want to sell fabric - they need to sell fabric. The shop Joe went nuts about was one of these.
They tend to have lower labor rates because they anticipate making additional revenue from the fabric sale. Most fabric houses offer a 50% discount to their dealers. So, the fabric revenue can be significant when the fabric is priced at retail. These shops charge cutting fees. They would fold if they didn't, because their low labor rates do not cover their long term fixed costs.
3. Blended Labor Plus Discounted Retail Fabric
These shops want to reupholster furniture. Mostly for homeowners and smaller scale business installations.
Their labor rates tend to be between the other types of shops - higher than the fabric sellers and lower than the labor only shops. These shops hope to sell fabric, which they share a portion of their dealer discount with the client to keep the total upholstery cost within reason, but don't tend to charge a cutting fee if the client provides their own fabric.
Why? Because they are not discounting their labor to induce a full retail price fabric sale. Their labor rates cover their fixed and variable rates of labor. And their fabric rates cover their fixed and variable costs of offering and assisting with fabric.
Our labor rate - as a blended labor pricing shop - would have been $1080 for the same project with a 25% discount on fabric. And would have included pick-up and delivery at no additional charge.
Joe set his sights artificially low based on his assumption that labor-was-labor without any additional considerations. When he changed the scenario by coming back with "I found my own fabric", he got twisted when the price changed and then went hunting for a 'C.O.M.' rate of $750 for his project. We couldn't accommodate him.
But it wasn't Joe's fault entirely. Why reupholstery pricing is such a black-box secret is a mystery to me. But, it helps to know pricing approaches vary so you can ask questions to better compare.
Thanks for reading.
More Fabric Related Information
The furniture workshop of JH Conklin & Co. upholsters furniture for people and businesses throughout Southern New Jersey, Delaware, Philadelphia metro and the southern shore areas. The workshop also provides custom window treatment and fabric resources.
Our general service area includes: Gloucester County, Camden County, Burlington County, Cape May County, Atlantic County, Cumberland County, Salem County, NJ; Chester, Delaware, Montgomery and Philadelphia county in Pennsylvania; and New Castle County DE. #NJupholstery