Optimal Profit Margins for Print on Demand Businesses

Managing costs, ensuring profitability, and keeping customers happy can be challenging for those new to eCommerce. Building a successful online business requires careful consideration of multiple factors, and setting the right product prices is one of the most crucial choices you'll face.

In this article, we’ll tackle a key question that every print on demand entrepreneur must address: what constitutes a healthy profit margin in the print-on-demand industry?

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What Is Considered a Good Profit Margin for Print on Demand?

For print on demand businesses, a healthy profit margin generally falls between 20% and 40%. This range helps cover essential expenses such as printing, shipping, platform fees, and marketing while still generating profit. However, your actual margin may fluctuate depending on factors like your niche, the perceived value of your products, and the brand recognition you’ve built.

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Calculating Print on Demand Profit Margins

Determining the right pricing strategy is crucial for the success of your print on demand business. Setting prices too high may deter potential customers, while pricing them too low can erode your profit margins, making it challenging to sustain your business.

Since there isn't a universal profit margin applicable to all products, it's essential to analyze specific product categories to understand pricing trends and average profit margins. Additionally, enhancing the perceived value of your products can justify higher pricing.

What Is a Profit Margin & How Is It Calculated?

Profit margin represents the percentage of revenue that remains after all expenses are covered. The formula is:

Profit Margin (%) = [(Selling Price - Total Costs) / Selling Price] × 100

How to Calculate Profit Margin

Let's consider an example: selling Tapstitch's Die-Cut Keychain

1.Calculate Total Costs

• ‍Product Cost: $3.58
• Shipping Cost: Varies based on destination; for this example, let's assume $3.43
• Transaction Fees: 6.5% transaction fee plus payment processing fees (varies by platform)‍
• Listing Fees: $0.20 per product listing (varies by platform)‍
• Estimated Total Cost: Approximately $8

2.Set Your Desired Profit Margin Suppose you aim for a 30% profit margin.

3.Determine Selling Price

• Convert profit margin to a decimal: 30 / 100 = 0.3‍
• Subtract this from 1: 1 - 0.3 = 0.7‍
• Divide total costs by the result: 8 / 0.7 = 11.4

4.Final Selling Price: Approximately $11.4 to achieve a 30% profit margin.

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T-shirts: A Profitable Print on Demand Product

Let’s start with the classic wardrobe essential—the t-shirt. Selling custom t-shirts online can be highly lucrative, especially considering how many are purchased through ecommerce platforms.

So, you're looking to sell custom t-shirts in your store. What profit margin can you expect for this product? T-shirt profit margins typically range from 10% to 50%, which is quite broad due to several factors that influence pricing, including:

• Niche market
• Quality of materials and fulfillment
• Brand recognition
• Competition
• Seasonality and trends

For example, if you search for "t shirts for family" on Etsy, the price range is between $14 and $47 (without discounts). The average price for a t-shirt in this category is around $30.50.

An printing t-shirt produced with Tapstitch costs approximately $6.89 for an M-size shirt with one placement of classic printing, which includes a one-time digitization fee of $2.99. After the initial digitization, you can use the design as many times as you like.

To calculate your total costs, you'll also need to factor in platform fees, transaction fees, shipping, and the time spent creating the design, posting the listing, and setting up your store.

Let’s assume your total costs add up to $15. If you set the selling price at the market average of $28, your profit would be $13, yielding a profit margin of 46%.

Pro Tip: Increase Profit Margins

To boost your profit margins on t-shirts, try these strategies:

• Opt for fulfillment methods like printing or multi-color printing to enhance the perceived value of your product.
• Target a very specific (and ideally underserved) niche.

Valuable Read: Start Your Online T-Shirt Business in 2025

By understanding the market and strategically pricing your custom t-shirts, you can create a profitable print on demand business with Tapstitch.

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Hoodies: A Top-Selling Print on Demand Product

Hoodies are another wardrobe essential that many entrepreneurs start with when launching their print-on-demand business. One key reason is that custom hoodies consistently rank among the best-selling POD products.

Generally, print on demand sellers set profit margins between 20% and 45% for hoodies.

On Etsy, “hoodies anime” are typically priced between $38 and $85, with an average price of $50.

A printed hoodie with one design placement from Tapstitch costs around $18. However, you’ll also need to factor in shipping costs, platform fees, and other expenses associated with maintaining your online store.

If your total costs amount to $23 and you price the hoodie of $45, your profit would be $22, resulting in a profit margin of just over 48%.

Pro Tip: Increase Hoodie Profit Margins

Boost your earnings by:

• Selling premium hoodies (e.g., Heavyweight Sunfade Oversized Hoodie)
• Creating scarcity with limited-edition designs‍
• Offering personalized customization options

By strategically pricing and marketing your hoodies, you can maximize profitability and make the most of your print-on-demand business with Tapstitch.

Read：How to start a print on demand business on Etsy

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Hats: A Profitable Print on Demand Staple

Hats are a versatile and in-demand accessory that remains a profitable option for print-on-demand businesses. They are lightweight, easy to ship, and suitable for various niches, making them a great addition to your store.

Typically, print on demand sellers set profit margins between 25% and 50% for custom hats.

For instance, if we search for "plain baseball caps" on online marketplaces, prices range from $15 to $40, with an average price of $28.

A high-quality blank baseball cap from Tapstitch costs around $10, covering the cost of materials and production. Adding shipping fees, platform charges, and marketing expenses, your total cost might be around $17.

If you price your hat at the market average of $28, your profit would be $11, resulting in a 39% profit margin.

Pro Tip: Increase Hat Profit Margins

Boost your earnings by:

• ‍Selling premium materials
• Offering limited-edition color variations to create exclusivity‍
• Bundling hats with other accessories to increase order value

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Key Elements Affecting Your Print on Demand Profit Margins

The profit margin estimates we've shared are based on existing products in various eCommerce marketplaces, but your actual margins could fluctuate due to multiple factors, such as:

• ‍Production costs
• Shipping charges
• Platform and transaction fees
• Pricing strategy
• Market demand and competition
• Marketing and advertising expenses
• Economic changes

Regulatory adjustments (taxes, tariffs, etc.)

To run a successful print on demand business, you'll need to continuously assess and adjust these factors. Pricing and strategy are not one-time decisions; they require regular evaluation in response to market shifts, customer preferences, and changing economic conditions to maintain strong profit margins.

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How to Price Your Print on Demand Products for Maximum Profit

Pricing your print on demand products requires a strategic approach. Start by calculating the total cost, including production, shipping, and platform fees. Once you have your costs covered, add a profit margin of 15–30% to ensure you're making a sustainable profit.

Next, conduct market research to compare your prices with competitors. If your prices are too high, you might deter customers, while pricing too low can hurt your profitability. Finding the right pricing balance will help you maximize sales and optimize profit margins.

Read：The Ultimate Guide to Pricing Your Products for Success

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Is Print on Demand Still Profitable in 2025?

Yes! Print on demand dropshipping remains a highly profitable venture for many businesses. The secret to success lies in targeting the right audience, setting prices that balance competitiveness and profitability, crafting a strong marketing strategy, and staying on top of product trends. By fine-tuning these factors, you can create a sustainable, long-term business that remains profitable well into 2025 and beyond.

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Wrapping Up

Throughout this blog, we’ve highlighted some general figures, but it’s important to keep in mind that, especially when starting, you might want to set more affordable prices to attract initial sales. As your brand builds recognition and gains momentum, you can gradually increase your prices for better margins.

Remember, the most effective way to figure out what works is by experimenting and learning from experience. Now is the perfect time to put your knowledge into action. When you do, feel free to share your results with us in the comments—we’d love to hear your feedback!

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