What is a Good Profit Margin for Print-on-Demand?

Balancing expenses, profit, and customer satisfaction can be tricky for an ecommerce newcomer. There are a lot of aspects that you must figure out to build a profitable online business, and pricing products correctly is one of the most significant decisions you’ll make.

That’s why, with this article, we aim to answer the question that every print-on-demand business owner encounters: what is a good profit margin for the print-on-demand market?

What is a good profit margin for print-on-demand?

A good profit margin for print-on-demand businesses typically ranges from 20% to 40%. This range allows to cover costs like printing, shipping, platform fees, and marketing, while ensuring a profit. However, the margin can vary based on factors like niche, perceived value, and how recognizable your business is.

Calculating print-on-demand profit margins

Your pricing strategy will determine how you make money with print-on-demand, or rather—how much of it you make. You have to strike the right balance because if you set the prices too high, customers won’t buy your products, but if you set them too low, your profitability will suffer, making it difficult to sustain your business over time.

There’s no one-margin-fits-all, so let’s look at specific product categories to find out what the prices are there and what the average profit margin is. Plus, you’ll get tips on increasing the perceived value of your products so you can charge more.

But first things first: what’s a profit margin, and how is it calculated?

A profit margin is the money you keep after all expenses have been paid, described as a percentage.

How to calculate a profit margin? 

Let’s say you want to sell Printful’s hardcover notebook on Etsy.

First, you calculate your total costs.

1. Cost of product: $12.95 (design is included in the price, so no extra costs there)

2. Cost of shipping: $5.50 (this depends on the location)

3. Transaction fees: 6.5% transaction fee + payment processing fees charged by the payment gateway you’re using (this depends on the platform you’re using)

4. Listing fees: $0.20 per product listing (this depends on the platform you’re using)

5. Total costs = roughly $20

Then, choose your desired profit margin. In this case, let’s say you want a 30% profit margin.

To see what your selling price should be to get a 30% profit margin, follow these steps:

1. Divide your profit margin by 100 to turn it into a decimal number, so 30 / 100 = 0.3

2. Subtract your profit margin as a decimal from 1, so 1 - 0.3 = 0.7

3. Divide your total costs by the result from step 2, so 20 / 0.7 = 28.6

So, your selling price should be approximately $28.6 to get a 30% profit margin.

Now, let’s examine real-life examples and see what your profit margin would be if you sold these print-on-demand products with Printful.

T-shirts

Starting with the wardrobe staple—the t-shirt. Selling custom t-shirts online can be a very profitable endeavor, seeing how the overwhelming majority of them are bought online.

Source: Statista

Valuable read: 12 T-Shirt Design Trends for 2024

So, let’s say you want to sell t-shirts on your store. What’s a typical profit margin for this product? T-shirt profit margins can range from 10% to 50%. Yes, that’s a huge range, but that’s because there are numerous aspects that affect how much you can charge:

• Niche

• Quality of the materials and fulfillment

• Brand recognition

• Competition

• Seasonality and trends

For example, if we look for “embroidered t-shirts for moms” on Etsy, the product prices range from $26 to $71 (without discounts). The average price for a t-shirt in this niche is $41.

Source: Etsy

An embroidered t-shirt produced with Printful would cost around $23.5 (for an M-size shirt with 1 placement of classic embroidery, including a one-time digitization fee of $6.50). After the digitization, you can use that design unlimited times, but if you make any adjustments to the original design, there’s an adjustment fee of $2.95.

To calculate your total costs, you also need to consider platform and transaction fees, shipping costs, and the time you’ve spent creating the design, posting the listing, and building your store.

Let’s say your total costs add up to $31, and you set the selling price to the market average—$41. Your profit would be $10, which means the profit margin would be 32.3%.

Pro tip: Set higher profit margins for your t-shirts by:

• Picking fulfillment techniques like embroidery or unlimited color embroidery to increase the product’s perceived value

• Choosing a highly specific (and preferably—underserved) niche

Valuable read: How to Start a T-Shirt Business in 8 Steps

Hoodies

Hoodie is another universally loved staple that people often choose when just starting out. One reason for this is that custom hoodies are continuously among the best-selling print-on-demand products.

Generally, print-on-demand sellers set profit margins from 20% to 45% for custom hoodies.

On Etsy, sellers charge between $38 and $70 for “pride hoodies.” So, on average, a hoodie without a discount costs $48.

Source: Etsy

With Printful, a printed hoodie with 1 design placement costs around $38. To the product cost you must add shipping price, website costs, and any other expenses related to upkeeping your online store and selling products.

If your total costs add up to around $43 and you sell it for the market average $48, your profit would be $5 and the margin would be a bit above 10%.

Pro tip: You can set a higher profit margin for your hoodies if you:

• Sell premium hoodies (e.g., Champion Tie-Dye Hoodie)

• Create scarcity by offering limited-edition designs

• Offer customer personalization

Valuable read: How to Sell Hoodies on Etsy in 6 Steps

Framed prints

Moving away from apparel, let’s talk home decor. More specifically—framed wall art. Depending on your niche, competition, and design quality, you can set a profit margin from 20% to 90% for framed posters. There’s a huge potential for a high profit margin, so it’s a product worth considering.

Now, on Etsy, sellers charge between $18 and $58 for a “patent art framed poster,” and the average price is $29 for a single 8″ × 10″ big poster. Since the range for the posters is so wide, you must decide what your positioning (e.g., are your posters “affordable” or “premium”) is before you price your posters.

Source: Etsy

Here are the variations of framed posters you can sell with Printful.

Source: Printful

The prices vary greatly based on the poster type (the main difference is the frame) and the size you pick. For the sake of example, let’s say you pick Enhanced Matte Paper Framed Poster in the size 8″ × 10″. Your total product cost would be $19.95 (Printful price) + all the expenses we’ve mentioned in the previous sections.

Let’s say the total product cost would be about $23. If you set your retail price to the market average of $29, your profit would be $5, and the margin would be 20.7%. But you can set considerably bigger margins by following the tips below.

Pro tip: Set premium prices for posters by:

• Selling posters in sets of 3 or more

• Selling limited-edition posters

• Offering unique art people can’t get elsewhere

Valuable read: 29 Poster Ideas + Tips to Create Your Own Poster Design

Profit margins for other popular print-on-demand products

All the ranges are just approximate estimates of what’s already selling on ecommerce marketplaces. Your margins will be affected by:

• Production costs

• Shipping fees

• Platform fees

• Product pricing strategy

• Product niche and demand

• Marketing and advertising costs

• Economic conditions

• Regulatory changes (taxes, duties, etc.)

Evaluating these factors will be part of building your online business, and, in most cases, they won’t be one-time decisions. You’ll have to revise your decisions and adjust your strategy based on market trends, customer feedback, and economic shifts.

Valuable read: How to Start a Print-on-Demand Business in 2024 in 9 Steps

How do you price your print-on-demand products?

To price your print-on-demand products, calculate the total cost, including production, shipping, and platform fees. Add a profit margin of 15–30% to these costs to ensure you cover expenses and make a profit. You must also research and compare your prices to the market’s average to ensure your products aren’t priced too high or low, and you have a good chance of making a sale and profit.

Is print-on-demand still profitable in 2024?

Absolutely. There are plenty of successful businesses to prove that print-on-demand dropshipping can be very lucrative. The key to profitability is connecting with an audience, setting fair, profitable prices, having a strong marketing strategy, and experimenting with trending products.

Valuable read: Is Print-on-Demand Profitable? Insights for Dropshippers

Final thoughts

While we’ve mentioned rough numbers throughout the blog, it’s worth noting that, as you’re starting out, you may want to set lower prices to make more sales. And with time, as your brand becomes more established, you can raise your prices gradually.

Remember, the fastest way to learn what works and what doesn’t is through trial and error, so now’s your time to apply this knowledge. And when you do, we’d be happy to hear your insights: share them in the comments!