If you are planning on high volume printing, a color laser or LED printer and the right transfer paper is a powerful combination. Add an optical cutter and an air operated press and you're set.
28 printed pages a minute, relatively cheap toner that goes a long way, transfer paper for almost half the price of inkjet transfer paper... hey, what's not to like? : )
You'll save lots of time and money in the long run, but that will require a commitment and well... sales! Of course, if you don't want to take the plunge, the right inkjet will work just fine also.
99.9% of your customers won't care or be able to tell if it was printed by an inkjet or LED. When printing a *well designed* graphic, most typical customers won't even question if it was screen printed or not. A good design and quality shirt will lead to sales regardless of the print method.
Many people get into the t-shirt business thinking it will make them instantly rich. In reality, there are many used heat presses in garages and on eBay from failed attempts (I get emails from random people quite often trying to sell their "like new" presses). Before buying any equipment, research the market you would like to enter. Buy a small number of shirts with your design and try to sell them. A little homework up front can save you $$$.
Twinge said:
sofaking: I've heard that laser transfers are generally worse than inkjets, though there was some paper (TransClip? I forget the name) that was supposed to be pretty good. I've never personally tried laser transfers, so I can't say for sure.
As for Photo-Trans ImageClip paper... 1) too expensive, 2) too much additional time to prepare and press, and 3) unimpressive results. Just my opinion.