Converting psfrag for use with pdflatex and lualatex

The package {psfrag} only works with the route latex -> dvipdf (or latex -> dvips -> ps2pdf), and not directly with pdflatex or lualatex. One way to get around this problem is to convert the whole figure, including {psfrag}, to a .pdf figure, which can then be included directly. In order to do that, start with the template psfragmall.tex: Download psfragmall.tex

\documentclass{standalone}
\usepackage{graphicx,psfrag}
\usepackage{schoolbook}   % Choose the same font as your document.
\textwidth=117mm          % Set the same width as your document.
\begin{document}
  \psfrag{M}[l][l]{Mätsignal}
  \psfrag{S}[l][l]{Styrsignal}
  \psfrag{L}[][]{$L$}
  \includegraphics[width=0.9\textwidth]{psfragmall.eps}    
\end{document}

After renaming to a suitable name, and replacing font and width, move the \psfrag-statements from the original figure to this file. Process it with latex -> dvips -> ps2pdf. The result is a complete pdf-figure, which can be included in the original place, typically with statements like:

\centering
\includegraphics{figure}
\caption{...}

Note that there should be no [width=...] specification, because this should be taken care of in the conversion file.