How To Price A T-Shirt To Actually Make A GOOD Profit

The first thing I had to figure out was how much to charge when I started designing and printing t-shirts.  I have experience in retail, purchasing directly from established brands with different price points on their products.  The interesting thing was the t-shirt base used was the same, but some could charge more because of the branding.

So how much should you price a t-shirt at retail?  There is an industry term called keystone pricing, which is the wholesale price(total cost to produce) of an item multiplied by 2 to get the suggested retail price.  Some factors that go into the pricing are the quality of the t-shirt you are selling, the design, the size of print, multiple location prints, and other embellishments.

I have printed t-shirts with various methods like heat transfers, sublimation, screen printing, and direct to garment.  The retail pricing starts with how much it costs to produce the t-shirt. Let’s take a look at what goes into that.

I’m sure you have run across t-shirts from the lower price range all the way to the top.  Is it all just branding? The simple answer NO, but that is a factor. Below are a few different tiers of t-shirt pricing groups and I will go into what is expected at each price level.  

The first thing to consider when choosing the right price, what is your competition is charging and what quality are they offering.  This tells you how much people are willing to pay for a comparable garment.  As for the quality, this tells you that you don’t need a premium t-shirt, which will cost more if a standard t-shirt will do.  The target customer is already used to purchasing items similar to those tees.

Cost Plus Pricing Model

This is a pricing method in which you add up the material costs, labor costs and overhead costs.  

• Material cost per t-shirt = $6
• T-shirt, ink, other possible materials(pretreatment, vinyl sheets, heat transfer paper, sublimation paper)
• Direct labor cost per t-shirt = $1
• Set up, active production time, clean up
• Overhead per t-shirt printed = $1
• Rent, electricity, phone/internet, insurance, equipment lease, admin overhead, other overhead

From the values above you get the sum: $6 + $1 + $ 1 = $8

Then you take that sum and multiply it by the sum of 1 plus the percentage for example 0.8(80%).  

$8 X (1 + 0.8) = $14.40

Which gives you a pricing goal at $14.40. 

Different Price Tiers For T-Shirts

Not all t-shirts are created equally.  The composition of materials in a t-shirt is the base level in the process that determines the price.  A standard raw cotton t-shirt is kind of stiff, rough, boxy, not too form fitting and cheap. Let’s get into that.  

The next level up is a mid-tiered t-shirt and this would possibly be a cotton or cotton blend.  Polyester is a man-made synthetic textile fiber which can be found in this grade of t-shirt.

This would be a premium tee which has a softer feel and more form fitting.  Possibly a tri-blend or cotton. Ring spun cotton is a process by which the cotton is softened by spinning and thinning into long strong strands.  These would possibly have sewn-in branding either on the hem of the sleeve or the bottom of the shirt.

A luxury tee can have embellishments like slits, foil, embroidery and/or stones/crystals.

Inexpensive Tier $10-15

These would be mostly limited in color, usually screen printed on a t-shirt base. This tee is more standard or economical as far as pricing goes.  The biggest tip with screen printing is, the price goes down in relation to an increase in the quantity being ordered.  All the setup fees are fixed.  So if you are paying mainly for your screen separations(for multiple color jobs) for each ink color, the ink itself and labor.  

After the setup fees, all you are paying for now is labor and ink which is minimal.  So the per unit cost goes down as you print more. If you have a few designs that are proven winners then this is a good option.

Medium Tier $16-24

This may have a better t-shirt blank to start with than the lower tier.  It can have a better printing method applied to it. It varies but it is in a slot between cheaper t-shirts and premium ones.  

Premium Tier $25-30

Premium materials like ringspun cotton(which is a tighter weave) allow for crisper and vibrant prints.  These t-shirts are better canvases for the inks to lay on top of. Generally, the quality is obvious from the garment weight, to the softness, the stretchability, and the fit. 

Luxury Tier $31-60

In this tier, you may find embellishments that are subtle or at other times obvious.  These can include sublimation, all over prints, foil accents, burnouts, embroidery, jersey materials, specialty pockets, and other premium materials.

Rules To Follow When Pricing

Know your target market and what they are used to buying.  They are familiar with this price point and are accustomed to the quality they will receive.  So if you charge a premium price and deliver a lower quality t-shirt you may have to deal with unhappy buyers.  Then they will either complain, request a return, or never return because they will not get a comparable product for the price.   But if your product is premium make sure you tell them, so they know they are in the right place. 

Research Your Market

What design styles are popular among other brands in the same niche?  What print style are they offering? What are their prices?

The correct strategy would be to price as they do or at least stay $2 within the range.  But do not price it less just because you want to undercut them.  Price it according to your goals as far as your pricing strategy, I will go into this a little later.

Price Psychology

There are quite a few tactics that help you convert more visitors to actual buyers with pricing.

I will share a few tips from Nick Kolenda below.

The first is the use of non-round ending values such as $20.00 vs $19.99.  Case studies have shown that decreasing the price by a penny tricks the mind into thinking it is less.  Not because it ends in a 9 instead of a 0, but because the 2 is now a 1 on the left-hand side.

Another tip is the use of prices with fewer syllables.  Prices with a longer syllable count had a lower sales percentage than those that had a shorter syllable count.  Because your mind has spent a longer amount of time processing this value it perceives it as more.

The size of the fonts used in prices also plays a factor.  On separate sales pages where the price was a smaller font was more successful than ones that had a bigger one.

Printing Factors That Affect Price

How complex is the design?

If a design is simple there is more variety of print processes available to complete the job, at the right production cost.  When you have several options available you have the ability to make more informed decisions on which is the right way to go.

How large is the print?

Obviously, a smaller design will use fewer inks, may use other pre press and post press treatments if those are required.  So the size of a print can change the total cost. Especially for a full back and full front print.

What print method is right for this t-shirt?

You need to find out which print method will yield the best final product.  Also, keep in consideration that it must be sold at a decent price to have good profit margins.  Pay attention to your target market and see which method they prefer. Why waste time making something which no one raised their hand and said they wanted.

How many locations are going to be printed on?

Most shirts have a mainly a front chest print, but some have a few print locations on a single item.  You could have a front and back print. Another option is a front and sleeve print. Or you can have all 3.  As the print locations increase so does the total price of the garment.

Related Questions

What is the average t-shirt price?  T-shirts vary in price throughout the different levels of quality put into the garment.  The more time it takes, the more premium materials, the more embellishments the item has all play a factor.  As I have stated above t-shirts can cost as low as $10 retail. You may even see prices that are lower, but those wouldn’t be retail prices.  Possibly a promotion or clearance of old stock.

How much do custom t-shirts cost?  Once again this varies for the reasons listed in the previous related question but also the printing process being used.