Debunking Myths: Is Print-on-Demand Risky?

So you have a great online business idea? Embarking on a print-on-demand venture can be an exhilarating journey, but it’s not without its share of obstacles and uncertainties.

One of the pivotal questions new entrepreneurs face is: is print-on-demand risky? This business model has gained popularity for its low upfront costs and ease of customization. However, it also brings unique challenges that can impact profitability and brand reputation. 

In this article, we’ll explore the potential pitfalls of print-on-demand (POD) services and weigh them against the benefits to help you decide if this is the right path for your online business.

Is print-on-demand risky? The short answer.

Print-on-demand offers a low-risk model for online entrepreneurs, eliminating concerns over high startup costs and inventory management. Without upfront investment in product stock or the hassle of product delivery, sellers can focus on creativity and market responsiveness, effortlessly updating their product lines to meet customer demands.

Print-on-demand risk factors

Even though POD is beginner-friendly with low startup costs, it has its risky side. Just like with any business venture, it’s wise to peel back the layers to understand the intricacies and challenges that may not be immediately apparent. 

Learn more: 95 Print-on-Demand Statistics and Trends You Should Know in 2024

Source: Printful

1. Quality control 

Quality control is a significant concern as the seller often doesn’t see their POD products before they reach the customer. This can lead to inconsistencies and defects that damage the brand’s reputation. 

Every print-on-demand provider approaches quality control in their own way. Here at Printful, all orders go through a 3-step quality check.

1. We assess your graphics and adjust them if needed to match the intended design

2. We check for any design issues while the product is in its production stage

3. We do a final product inspection before packaging and shipping out the orders

We also minimize quality concerns by: 

• Working with trusted manufacturers and providing only premium quality products

• Investing in industry-leading technology like Kornit printers and Coloreel embroidery machines

• Conducting extensive product testing to ensure the best possible outcome every time

• Providing detailed product descriptions and mockups

• Keeping the order reshipping rate at only 0.24%—a testament to our commitment to quality in t-shirt printing and other POD services

• Offering store owners three monthly sample orders at a 20% discount

Since each product is fulfilled individually by a skilled in-house team and we work with trusted manufacturers, our product quality is highly consistent. It’s important to work with a POD supplier that you trust to provide this consistency since you won’t be able to see every product before it reaches your customers.

2. Lack of control over inventory 

One of the great advantages of print-on-demand companies lies in their flexibility. They offer a wide array of unique designs and color options without the need to hold every product variant in stock. 

Instead, less popular items are restocked on an as-needed basis—a process that typically takes just a few days and is accounted for in our fulfillment timeline.

Source: Printful

Nonetheless, situations may arise where a product is temporarily unavailable from our suppliers for an extended time. Common reasons for such shortages include:

• Limited quantities available from the manufacturer

• Suppliers based at a considerable distance

• Discontinuation of specific items

• High-demand periods like the holiday shopping season

It’s essential for sellers to monitor their supplier’s stock levels closely and have contingency plans in place to address any stock issues promptly.

If you’re using Printful, you can mitigate the risk of supplier shortages by utilizing the availability tab provided for each product.

Go to Product Catalog, select any product, and scroll to the Availability tab. Here, you’ll find the current stock status at our facilities. You can quickly see which items are readily available and which are restocked on demand, and you can identify discontinued products.

Source: Printful

You may also enable product substitutes in cases of stockouts, ensuring that your business remains unaffected by supply chain fluctuations.

To enable Product Alternatives, log in to your Printful account and go to Dashboard > Settings > Orders > Product Alternatives. Tick the box that says “Use Product Alternatives for my orders” and press Save.

3. Shipping costs and times

Shipping is a critical factor in customer satisfaction, and changes to shipping costs or delivery times can substantially impact your profits. With print-on-demand, you can’t speed up the fulfillment and shipping times. 

What’s more, shipping rates can vary widely depending on the destination, package size, and speed of delivery. High shipping costs can lower profit margins, mainly if the seller absorbs these costs to remain competitive. Make sure to keep a close eye on shipping fees and adjust your pricing strategy accordingly to safeguard your profits.

Additionally, unexpected delays in shipping, such as those caused by carrier issues, customs hold-ups, or high-traffic periods, can lead to customer dissatisfaction and potential complaints or returns. 

To mitigate these risks, stay informed about any changes in shipping carrier rates and policies, and update your shipping practices to maintain a balance between cost efficiency and customer satisfaction.

It’s important to manage customer expectations by providing precise and accurate shipping information and having a clear shipping policy on your online store to address any issues that may arise. 

All successful print-on-demand stores have policies in place for customers to check. 

Here’s an example of Asos’ shipping policy.

Source: Asos

Learn more: A Complete Guide to Ecommerce Shipping Pricing [2024]

4. Dependence on ecommerce platforms and marketplaces

In the world of online sales, reliance on ecommerce platforms and marketplaces can be a double-edged sword. While these platforms provide ready-made infrastructure for building your ecommerce store and selling products, they also hold a significant amount of control over your print-on-demand business. This dependency means that changes in policies, fee structures, or search algorithms can have immediate and sometimes drastic effects on your visibility and sales.

For instance, most platforms charge various fees, including listing fees, transaction fees, and possibly a percentage of each sale. These costs can cut into your profit margins, leaving you with the tough decision of either increasing your prices or absorbing the costs.

If you decide to sell on an ecommerce marketplace, you’ll join millions of other sellers, making it a challenge to stand out. Your products will be listed alongside those of your competitors, so having a strong differentiation strategy is vital to capture the attention of potential customers. Investing in marketing and SEO within these platforms is also crucial to increase visibility.

Moreover, the risk of account suspension or termination is ever-present. A violation of the platform’s often complex rules, intentional or not, can lead to your store being temporarily or permanently shut down. This can be devastating, especially if a significant portion of your revenue comes from a single platform.

To combat these risks, it’s wise to diversify your sales channels. Consider having your website in addition to your chosen ecommerce platform, and use social media and other marketing methods to drive traffic to multiple sales venues. 

For example, if you have a Shopify store, consider creating an Etsy store as well, where you won’t have to worry about a monthly subscription fee. Once you add new custom t-shirts to your Shopify website, push them to Etsy too. 

This way, you’re not putting all your eggs in one basket and can better weather the storms that come with platform dependency.

 5. Market saturation

As print-on-demand services grow, a crowded market has become an accepted reality. The ease of entry draws many sellers, escalating the battle for customer attention and making it increasingly difficult for individual brands to shine.

In such a saturated market, only products that truly stand out—be it through unique designs, superior quality, or an exceptional brand story—manage to capture and retain customer interest. This requires a more strategic approach to marketing and a strong emphasis on brand identity to differentiate from competitors.

Moreover, the surge of players in the market can spark a fierce pricing war. Numerous sellers vying for the same customer base may drive prices down, squeezing profit margins to the limit. 

To navigate this challenge, sellers must strike a delicate balance: offering competitive pricing while safeguarding profits. This often requires strategic tactics, like creating outstanding product images to captivate the shoppers or enhancing the overall customer experience to provide added value without incurring extra costs.

 6. Rapidly changing trends

The print-on-demand business model, while flexible, also demands that sellers stay on top of rapidly changing trends. Customer interests can shift quickly, and what is popular one month might be passé the next. This presents a risk for print-on-demand sellers who must continuously adapt their product offerings to align with the latest styles, memes, or cultural phenomena.

 To mitigate this risk, sellers must be agile and responsive, often requiring a proactive approach to trend forecasting and market research. By keeping a finger on the pulse of trending products and customer behavior, sellers can anticipate changes and update their designs and products accordingly. 

 However, brands that hone in on specific niches and cultivate the attention of a narrowed-down target market often do pretty well without following any trends at all. 

 Learn more: 12 T-Shirt Design Trends for 2024

Source: Rastaclat

Print-on-demand vs. fulfilling yourself: what’s riskier?

Each method carries its own set of risks and benefits that new entrepreneurs must consider.

With POD, you’re placing a significant portion of your business operations in the hands of a third-party service provider. This can include everything from production to shipping. While it can reduce the burden of inventory management and upfront costs, it also means you have less control over the production quality and fulfillment speed.

Source: Unfinished Legacy

On the other hand, fulfilling orders yourself gives you complete control over inventory, quality checks, and shipping. However, it requires a substantial investment of time and money. You’ll need space for your inventory, resources to handle shipping logistics, and upfront capital to produce or buy your products in bulk. Additionally, self-fulfillment demands a more hands-on approach to customer service, which can become overwhelming as your business grows.

Both approaches have their merits, and what may be riskier for one business could be the safer bet for another. It largely depends on your specific business needs, resources, and goals.

Learn more: 10 Differences Between Print-on-Demand vs. Do-It-Yourself

The final verdict

While print-on-demand dropshipping offers a low-risk entry point for entrepreneurs, it has potential pitfalls. Issues like quality control, shipping costs/speeds, dependence on ecommerce platforms, market saturation, and the need to keep up with rapidly changing trends all present challenges.

 However, these risks can be mitigated with careful planning, a strategic approach, and a clear understanding of the market, allowing for a successful and profitable online business venture. 

 If you plan on starting a POD business, consider providing high-quality products for your customers and join us!