A setup charge covers preparing your artwork for the machine that will apply it: making the screen, digitising the embroidery file, creating the plate or programming the laser. It is work done once, before any units are produced.
Why it is separate from the unit price
The preparation costs the same whether you order fifty units or five thousand. Building it into the unit price would make small orders look artificially expensive per item and large ones artificially cheap. Separating it is more honest — and it is why the same product can be quoted at very different per-unit prices at different quantities.
It is per color and per position
Screen printing needs a screen per color. A four-color design has four setups. Printing on the front and the back is two positions, each with its own. This is why simplifying artwork by one color can move the price more than negotiating on the product.
Embroidery works differently
Embroidery is digitised once into a stitch file, and after that color count barely matters — stitch count does. A large dense design costs more to run per piece regardless of how many colors it uses.
Repeat orders usually avoid it
If the same artwork goes back to the same supplier for the same product, the setup already exists. Reorders are often quoted without it, which is one of several reasons consolidating merchandise to one relationship costs less over a year than the unit prices suggest.
What to ask
Ask whether setup is included, how many colors and positions the quote assumes, and whether a reorder carries it again. Three questions that make two quotes comparable.
Our guide to what moves merchandise pricing covers the other variables, and the products page lists the decoration methods each category takes.