How to Price Your Print-On-Demand Products

Product page<\/a>, or when adding products to your store\u2014more on that process later in the video.<\/p>\n\u00a0<\/p>\n<h4>3. SHIPPING COSTS<\/h4>\nWhile your print-on-demand service will ship products for you, it's an extra cost for your customers. You need to consider what kind of shipping rates to offer your customers and, if you choose a flat rate, make sure that covers the rate your POD provider is charging you. The shipping price will vary based on your product, fulfillment location, and end destination. <a href=https://www.printful.com/"https:////www.youtube.com//watch?v=pB_cBmv-7a0\%22>Watch our video on shipping<\/a> to find out how Printful deals with shipping and go to our <a href=https://www.printful.com/"https:////www.printful.com//shipping/">Shipping page<\/a> to see our flat rates.<\/p>\nAnother way to deal with shipping is that instead of charging your customers extra for shipping, you can offer it free instead. Customers are 4 to 5 times more likely to buy something if you offer them free shipping. You can do that by including the rates in your product base price so you don't have to pay for shipping out of pocket.<\/p>\nYOUR RETAIL PRICE + PRINTFUL\u2019S SHIPPING RATE = YOUR RETAIL PRICE WITH FREE SHIPPING<\/p>\nEven if it makes your product prices higher, shoppers just can\u2019t resist getting something for free. You can learn more about that in our <a href=https://www.printful.com/"https:////www.youtube.com//watch?v=Hc4HCIbT8_c\%22>sales psychology video<\/a>, link in the description below.<\/p>\n\u00a0<\/p>\n<h4>4. TAXES<\/strong><\/h4>\nNext, we have taxes. Depending on where your end customer lives,<\/span> Printful may charge tax on your orders, such as Sales Tax in the US and Canada, VAT in the EU, UK, Norway, and Liechtenstein, or GST in Australia and New Zealand. <\/span>You may also be liable to collect tax from your customers. Depending on the situation, these expenses may also go into your product price.<\/span><\/p>\n\u00a0<\/p>\nThe sum may vary from 4% to 10% in the United States and from 17% to 27% in the European Union, and may be calculated from a different base price in each place. There is no way to predict the exact rate before you know the location of your customer. That\u2019s why we strongly recommend you consult a tax specialist on your specific situation to find out what you need to have in mind when calculating taxes for your product price.<\/span><\/p>\n\u00a0<\/p>\nIf you want to know more about how Printful calculates and collects taxes, <\/span><a href=https://www.printful.com/"https:////www.printful.com//faq//taxes-and-billing/">A Guide to Printful Taxes\u00a0<\/a><\/p>\n<a href=https://www.printful.com/"https:////printful.s3-accelerate.amazonaws.com//upload//file-upload//21//213953938dd3381df9cf765a0a0f4a7a?response-content-disposition=attachment%3B%20filename%3D%22Printful-taxes-infographic-A4-10.2022-%281%29.pdf%22&response-content-type=application%2Fpdf&AWSAccessKeyId=AKIAJH7JLGRY6WQHFAZQ&Expires=1816433554&Signature=5gQE002GTCMVXRWIvM6p8tD1MoE%3D\%22>Products page<\/a>, the final product price for each order depends on factors like production technique, print placement, product color, size and fulfillment location. To get the most accurate price, use our product push generator to push products to your store.<\/p>\nFor this shirt, I\u2019m going to put a print on the front as well as an outside label on the back. Be sure to choose all of the colors and sizes you plan to offer on your store, because different colors and sizes can have different prices, and keep in mind where your customers are located to choose the colors and sizes that are stocked at the closest possible location to them. My chosen audience is going to be from the USA, so I\u2019m going to keep that here.<\/p>\nNow, after I choose my mockups and product descriptions here, we get to the pricing tab. As you can see, the Printful price differs, based on size and color of the shirt. There are four ways to approach this size difference to calculate your production cost.<\/p>\n<ul>\n<li>First, I could price each size or size group as different products. So this design in sizes XS to XL will cost me $14.98, but it will be $16.43 for size 2XL. Building prices this way, I\u2019ll end up with a different retail price for size 2XL, which is not always ideal. That brings us to the second option.<\/li>\n<li>Calculate the product cost by the most expensive size. This time that would be $16.43. If a customer buys an XS to XL size shirt that costs you $14.98, I get an extra $1.45. If they buy a 2XL, I cover my costs exactly. This works only if I\u2019m not making low retail prices my selling point\u2014for that, every dollar counts!<\/li>\n<li>Calculate the product cost by the less expensive size. If a customer buys an XS to XL, I cover my costs exactly. If they buy a 2XL, I pay that $1.45 out of my pocket, taking away from my profit, but keeping my prices low.<\/li>\n<li>And lastly, I could calculate the average cost of all sizes. Here I\u2019ll sum all of them up and divide by the number of sizes I offer. That $15.22 in this case. Now every time I would sell a size XS to XL, I would gain 24\u00a2 to cover for the $1.21 I lose on each 2XL sold.<\/li>\n<\/ul>\nFor this example, I\u2019ll choose the last option, and consider the cost to be $15.22 before taxes.<\/p>\n\u00a0<\/p>\n<h5>3. SHIPPING COSTS<\/strong><\/h5>\nTo get an idea of my shipping costs, I have to consider where my customers are located. This is important to me, because I want to offer free shipping for all of my customers in the USA.<\/p>\nYOUR RETAIL PRICE + PRINTFUL\u2019S SHIPPING RATE = YOUR RETAIL PRICE WITH FREE SHIPPING<\/p>\nIf I go to Printful\u2019s Shipping page, I see that shipping for shirts in the USA is going to cost me $3.99 and I\u2019m going to add that to my costs to set up free shipping to the US on my store.<\/p>\n\u00a0<\/p>\n<h5>4. TAXES<\/strong><\/h5>\nAs I plan to sell this shirt primarily in Alabama, but don\u2019t have a physical presence or economic nexus there, I am not liable to collect tax myself and just need to take in mind the tax that Printful will charge on my orders. As I said before, the sales rate will vary from location to location, and the exact tax for each order will be calculated after the order is placed. However, I looked up the combined Alabama sales tax rate, which is 9.14% and the sales tax base in this state is Printful\u2019s price.<\/p>\nSo that\u2019s $14.98 times 9.14% for sizes XS to XL and $16.43 times 9.14% for size 2XL. $1.37 for XS to XL and $1.50 for 2XL. I\u2019m going to pull an average of those rates here as well, as I did with production costs. That\u2019s 1.39$ I\u2019m going to count in my product cost for taxes.<\/p>\nRemember to consult a tax specialist on your specific situation to find out what you need to have in mind when calculating taxes for your product price.<\/p>\n\u00a0<\/p>\n<h5>5. PLATFORM FEES PER ORDER<\/strong><\/h5>\nI\u2019m using Shopify and I have to take in mind that Shopify will charge me 2.9% fee per transaction, plus 30\u00a2 for an order. I don\u2019t have any other fees per product that I am aware of, so I can go ahead and count all of these up.<\/p>\n\u00a0<\/p>\n<h4>COST SUMMARY<\/strong><\/h4>\n$15.22 for production costs, $3.99 for shipping, 1.39$ for taxes, 30\u00a2 to Shopify +2.9% of my retail price to keep in mind. That\u2019s $20.90 + 2.9% from the retail price.<\/p>\n\u00a0<\/p>\n<h4>STEP TWO: ADD A PROFIT MARGIN<\/strong><\/h4>\nPRODUCT COST + PROFIT MARGIN = RETAIL PRICE<\/p>\nNext, I\u2019m going to add my profit margin. To begin my calculations, I\u2019m going to set that at 20% on top of my costs. That\u2019s $20.90 + 20% = $25.08. I\u2019m going to round that up to $26.<\/p>\nNow that I know my retail price, I have to take in mind the 2.9% Shopify us going to charge my orders, which would be 75\u00a2, making my costs $21.65 and my profit margin $4.33.<\/p>\n\u00a0<\/p>\n<h4>STEP THREE: ADD UP OTHER COSTS<\/strong><\/h4>\nNow I have to see what other costs I have in a month. My Shopify Basic subscription costs me $29 a month. In addition to that, I bought a domain from Domain.com to look more professional. That costs me $9.99 a year, which I'll divide by 12 to get a monthly overview. That\u2019s 83\u00a2 a month. And don\u2019t forget to add the design costs, which was $7.50.<\/p>\nOTHER MONTHLY COSTS \/ YOUR PROFIT MARGIN = MINIMUM ORDERS PER MONTH<\/p>\nLet\u2019s add up my monthly costs, $37.33, and divide them by my profit margin, $4.33. Looks like I have to sell a minimum of 8-9 designs a month to cover all of my costs, and more if I want to start profiting off of my work.<\/p>\nRemember that this will never be a zero-sum game. The product costs may still vary from order to order because of customer location, taxes and other variables, and you may want to change your retail price frequently, depending on the competition, season or a specific pricing strategy you choose to adapt. The work has just begun, but you\u2019re on the right path.<\/p>\nCome back to your product pricing strategies on a regular basis\u2014go over your product costs and see if there have been some changes, try out something new and keep up the good work.<\/p>","videoTimestamps":[{"key":"00:00:53","value":"Step one: Assess your product cost"},{"key":"00:04:42","value":"Step two: Add a profit margin"},{"key":"00:05:24","value":"Step three: Add up other costs"},{"key":"00:05:59","value":"Summary"},{"key":"00:06:22","value":"Step four: Review your prices regularly"},{"key":"00:09:23","value":"Pricing a Printful t-shirt: example"}],"imgUrl":null,"thumbImgUrl":null,"youtubeImgUrl":"https:\/\/img.youtube.com\/vi\/_kwXAFdvKNk\/maxresdefault.jpg","contextId":"ea99d2ae3360006f168c923bfe00ae74","hasBookmark":false,"canBookmark":true}" :skeleton-id=""video-lesson-skeleton"" :related-lessons-title=""Recommended for you\u00a0<\/p><\/span>"">