EducationQ&A

Should businesses charge a setup fee for large orders?

The short answer is yes. I would include the setup fee with the quote – I wouldn’t break it out separately. However, if someone is placing an order that doesn’t have dates or names associated with it, there’s a good chance of that being a repeat order, or an additional quantity order being made. I would explain to the customer that they don’t have to pay the setup fee the second time they order that particular item. 

If it’s a one-off order, then include the setup fee with the quoted price. If it’s an order that would be reordered time and time again with little to no modification, then break out the setup fee and let the customer know that they don’t have to pay the setup fee the second, third, or fourth time that they place an order for this item. 

For example, let’s say someone is producing ribbons to be given out at a race. The only thing that has to change on the order is the year of the race. You have first place, second place, third place – there’s no names on the ribbons. Customers don’t need to pay the setup fee in year two, three, four, etc. because there is little to no modification in the order itself. 

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Julia Schroeder

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