Online commerce is on the rise, and if you are looking to start your own business with minimum investment and fuss and maximum profits, then starting a T-shirt business might be ideal for you.
Now you must be wondering if selling T-shirts online is profitable. To find out the growth prospect, pros and cons, profit potential, and more, keep on reading this guide.
How Much Does It Cost to Start an Online T-Shirt Business?
On average, starting your online T-shirt business can cost anywhere between $250 to $20,000.
The start-up cost for your online t-shirt business largely depends on the kind of t-shirt production method you choose, and the price could also rise depending on the online selling platform you choose.
For example: if you choose heat transfer printing, then you would have to invest at least $700+ for a heat transfer printing machine, $200 for a vinyl cutter, and other things.
Also, if you choose Etsy as your marketplace, then you would have to pay $0.20 to publish a listing in the marketplace. Or if you choose the Shopify store, then expect to pay $250 to $500.
How To Start an Online T-Shirt Business?
Pros & Cons of T-Shirt Business
Pros of T-Shirt Business
- You can start with less investment
- Scalable
- High-profit margins
- Unlimited income potential
- Multiple places to set up your business
- E-commerce retail is the new future
- Easy to encourage “impulse buying.”
Cons of T-Shirt Business
- Extreme competition
- High overhead expenses
- Starting out & building trust can be challenging
Pricing Calculation For T-Shirt Business – What Are The Average Margins?
It is important to find out your t-shirt cost so that you can add a profit margin based on your target audience.
As per Entreprenuer, 30% to 40% is the average profit margin for t-shirt business, but most merchants aim for a 50% profit margin.
To find the final price of your t-shirt including profit margin, use this formula:
Your Price = [(cost to produce) ÷ (100-profit %)] x 100
So, for example, let’s say you want to keep a profit margin of 45% on a t-shirt that costed you $10. Then this is how you will calculate your final sales price:
Your Price = [(10.00) ÷ (100–45)] x 100
Your Price = [10.00 ÷ 55] x 100
Your Price = $18
Is Selling T-Shirts Online Profitable?
The money that you can make from your t-shirt business depends on:
- the number of hours you are willing to put in the business.
- amount of labor.
- your target audience.
- your profit margin.
On average, t-Shirt business owners make up to $100,000 per year in revenue and get to keep $40,000 – $50,000 in net profits.
You might not be able to make this much when your business is comparatively new. But with regular sales, the number can reach even more than $100,000 per year.
Here’s an estimate for you:
Sale Price Estimation
So a piece of 100% cotton t-shirt would cost you between $5-$9 depending on the color, quantity, and quality.
The t-shirt printing machine ideally takes 30 minutes to print 70 t-shirts. So for a six-color t-shirt, you can charge $7 a piece, bringing the total of 70 t-shirts to $490.
Estimated Cost
Let us see the actual pricing of 70 t-shirts now. So if you buy in bulk, then 70 t-shirts would cost you an estimated $2 per piece and a total of $140.
Now after adding $21 for screen-making materials, $1 for lighting and power, and approximately $3.60 for ink. Then your total cost for 70 t-shirts would come down to $165.6.
Estimated Profits
So to create 70 t-shirts, you would need to spend $165.6 from your pocket, and with a 30-40% profit margin, you can make roughly $400 in profit.
If you manage to get orders that look like this every day, then you can make $10,000 a month and more than $100,000 a year.
How Much Can You Sell Different Types of Apparel For?
It is difficult to pinpoint exactly how much you can sell an apparel for. Your selling price would depend on multiple factors, including:
- The number of orders you get.
- Competition in your area.
- Labor if included.
- The cost price of the item, etc.
Here is the sales price of different types of apparel for custom designs and smaller orders.
- T Shirt Logo Front / Full back – $15-25
- Left Chest Logo T-Shirt $10-15
- Logo Hat – $12-25
- Baseball Jersey Shirt $20-35
- Full Front Fashion Shirt – $15-30
Note that this sales price is based on selling a single to a dozen t-shirts to a single customer.
Future of Online T-Shirt Business
The T-shirt business market is perceived as saturated, but on the contrary, its business market size is expected to grow by 9.7% in annual compounded growth between 2021-2028.
Many still consider it to be a good and lucrative business opportunity. But just like any other business, the success of your t-shirt business would largely depend on your research, marketing skills, and pricing, among other things.
The best advice would be to start slow and pump in the money as your business grows as opposed to going all in right at the start.
Wrap Up
So after looking at the nitty gritty of the t-shirt business, we can say that entering this market is going to be challenging since there is so much competition.
But if you manage to create a strong footing with your unique designs and good marketing, then you can easily earn $100,000 in revenue, and then the sky is the limit.
The revenue in the T-shirts segment amounts to US $44.56 bn in 2023 and is expected to rise by 3.22%, according to Statista.
We hope you found this guide on “Is Selling T-Shirts Online Profitable” useful.
FAQ
Can I make money in t-shirt business without holding inventory?
Print-on demand business model in the t-shirt business is the best model that you can choose as it does not require you to hold any inventory, and you can start it with minimum investment.
Is selling t-shirts on Etsy profitable?
Etsy is a very popular platform for online sellers, with more than 5.5 million active sellers and 89.1 million buyers as of 2022. So if you create unique designs and keep the prices right, then the sky is the limit for you.
Do I need a business plan to start my t-shirt business?
You do not necessarily need a plan, but it is always ideal to plan things out before starting a t-shirt business.
Amit Gupta is an experienced expert in digital marketing and co-founder of DrFranchises. With more than 11 years of knowledge in franchise digital marketing, SEO, email marketing, and social media marketing, Amit has helped many brands achieve incredible success online. As a passionate entrepreneur and owner of 7 franchises, he continues to study franchise models, looking at costs, revenue, and profitability to guide brands toward profitable growth. When he’s not working on digital marketing, Amit enjoys spending time playing with his beloved dog.