The t-shirt game is a profitable adventure once you get the hang of it. One of the major aspects of the business that affect your chances of a good profit is the pricing of your products. It can be tricky deciding on the proper pricing, but once you’ve got your business planned out it’ll be easier making the decision. Your pricing among other things will affect your revenues as well as your profit- two things that make the difference between a successful business and an unsuccessful one. But how do you set the right price for your t-shirts?
Let’s take a look at some of the common price ranges for t-shirts.
There’s the $10-$15 range: This is usually found in new brands who plan on going with the ‘cheap shirts’ approach or brands who have been around for a while and can afford huge bulk orders that allow them to sell their t-shirts for low costs and still get a good profit.
The $16-$24 range: The unofficial average price range for the majority of t-shirt brands. Most brands you come across will have their tees at this price range whether they’re new or have been around for a while. Great profit margin if you can afford huge orders, good enough margin if you place small wholesale orders.
The $25-$30 range: These tees usually come off as higher quality than the average tees and often involve designs that feature various print locations, multiple print techniques and all over prints. Many streetwear labels, rookies and vets alike, go with this range.
The $31-$60 range: Upscale labels often pull off this price range. These tees are often associated with luxury, affluence and sophistication and also have more complex production processes…or the brand is so popular the name sells itself. The labels are also often endorsed by and marketed towards celebs, which allows the retail price to be so high.
When choosing a price range for your brand, keep in mind these key factors to each range. See which range your brand could best be defined as or which you’d like for your brand to be sold for. Be realistic too. Some newbies make the mistake of trying to create expensive upscale labels without offering high quality t-shirts or having any celebrity backing.
A good thing to do is check the pricing of competitors. Do yours match up? Are they lower or higher? Try to keep your pricing in the same range as brands in the same niche as yours. You might be thinking ‘I’ll sell my tees cheaper than my competition so that people prefer mine!” This isn’t always the case. Only offer cheaper prices if you can still promise equal or better quality. Otherwise you’ll just come off as a knock-off, wannabe brand. The ‘CHEAP, CHEAP, CHEAP!’ approach isn’t necessarily the best route to take.
The pricing mentioned above is referring to online or retail pricing. Now let’s take a look at wholesale pricing.
Typically, retailers will take your product and sell it for 2x as much as they bought it for. If your retail price is $20 your wholesale price should be $10. This is what the price ranges above would look like as wholesale prices:
$10-$15 retail=$5-7.5 wholesale
$16-$24 retail=$8-$12 wholesale
$25-$30 retail=$12.5-$15 wholesale
$31-$60 retail=$15.5-$30 wholesale
Are you ready to offer your t-shirts for these wholesale prices? Will you still be able to profit? Here’s a rule you should try to go by. Production cost x 2 = Wholesale price.
Wholesale price x 2 = retail price.
Keep these things in mind when deciding on the pricing for your t-shirts. As with many business journeys you may find that not all this pricing stuff is the same everywhere or that your particular situation requires you to price differently. Now let’s play some Plinko!
BONUS TIP: Read our book LAUNCH A KICK-ASS T-SHIRT BRAND for in depth advice and tips like these. Tons of useful information you can’t afford to miss!