# Pricing for American Apparel using DTG line



## tshirtloverkatie (Aug 9, 2013)

Hello,

I am working on a new line and using exclusively American Apparel shirts. I will be using an outside vendor to do DTG printing. They are able to do order fulfillment and print as needed (vs me printing 100s at a time) and do the shipping for me.

The COGs averages around $14 per shirt. This includes printing, shirt cost, including a business card & sticker in the shipping package.

I am trying to gauge what most others charges for AA shirts using DTG/screen printing.

Is the normal markup 50%? I was going to charge $29-$32 for most of my shirts. My other dilemma was doing kids onesis, they have the same COG price but would someone pay $30 for a baby onesie?

Does anyone sell AA shirts they printed on wholesale? Seems like the profit margin would be $1.00 per shirt.

Any thoughts?


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## kimura-mma (Jul 26, 2008)

A common pricing model is "keystone" pricing. This is where you double the production costs to get the wholesale price, then double the wholesale price to get the retail price.

So for example, if your production costs are $7, you could sell them wholesale for $14 and sell them retail for $28.

This model would work if you were stocking inventory and getting dozens of shirts printed at a time. But since you are using a fulfillment service, your cost is equivalent to the wholesale price, not the production cost. So at a $14 cost, you can retail them $28. But there isn't much room for wholesale. You would need to print in higher volume to sell at wholesale.

$29-32 for a printed AA shirt is ok. Slightly high, but not outrageous. It depends on your market. A $30 onesie is way too much. You're going to have to drop your margins on the onesies. Even at $20, it's a hefty price to pay.

And to clarify, marking up a $14 shirt to $28 represents a 100% markup. It's the profit margin that would be 50%.


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## tshirtloverkatie (Aug 9, 2013)

Thanks so much for the reply. Yes, I have another business that is product based and I can get close to that model. I think going the fulfillment route at first is playing it safe but ultimately I won't be stuck with a ton of inventory and a huge outlay of money if the business fails. (And of course like most people starting a business I don't think it will!)

I plan on revisting the model after 6 months, 1 year- etc. and then hopefully I can go the route of buying my inventory and printing ahead of time. I didn't realize DTG was do costly- $6.00 per shirt is what I am getting with fulfillment. Without fulfillment I would assume I can save a couple bucks per shirt there & on the cost of the shirts and then can get into wholesale.

I have asked friends and they agreed $29-$32 for AA isn't bad and they do/would pay that. Seems to be fair based on my research online as well. Probably will lower the onesie cost and take a smaller margin.

Thanks again for you help.


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## g.lupo (Aug 20, 2007)

I would have a sample printed before you start to sell online. Not all dtg is created equal especially when printing on dark colored shirts. We have seen how drastic one machine can print compared to another. Especially since a good AAshirts you want a good quality print.


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## tshirtloverkatie (Aug 9, 2013)

Def g.lupo... I have samples planned on being printed 3 weeks before I planned to launch. I have already rejected one company that couldn't meet my needs (poor print for sure.)


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## platnumcn (Aug 5, 2013)

You know its all about the best first step in the market and your margin will shoot. My point is that if you have funds, go on a promotion spree and try to earn as much exposure as possible. Once you do that, your margin will increase manifolds. I know you did not ask this question, but I was just sharing my views with you. 

Am sorry for that.


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## ozzymac (Nov 16, 2008)

Hi, I'm the one who use AA for my weapons, DTG. Feel free to see my stuff on the web. [see my profile]

One thing to tell is the prices is reasonable only you(your customers) know what AA is.

Regards,


Sent from my iPhone using TShirtForums app


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