[apexos]

A poll for all t-shirt gurus!!

I have a quick poll for the gurus and entrepreneurs in this forum. Here is the scenerio:
Assuming that you had US$100k, you had all the required computer/software know-hows to build a fulfillment service like Cafepress/SpreadShirt
website. You have the sufficient know-hows on heat transfer. The operating cost in your country is lower than that of the US,
would you start a fulfillment business like CP/SS??

Here are your choices:

1) Yes, the fulfillment market is huge, definitely there is room for another CP or SS.
2) Yes, but I'll be cautious cos CP, SS and Zazzle has grown too big to compete against.
3) Hm... may be, it is challenging, if I can provide the same quality as CP/SS at a lower base price,
there is still room for it.
4) No, the fulfillment market is slowing down, designers start printing their shirts to make more profit.
5) No way, the fulfillment market is saturated. I'd rather use the $100k to pay off my mortgatge.
6) None of the above, but here is what I think...

Please pick one and let me know your reasons. Thank you very much.

 

[CoolHandLuke]

Yes to number one, but printing via DTG and not just "heat press". However, you're going to need a different angle and the total investment is going to be more than 100K. But that's enough to get the ball rolling.

 

[apexos]

Agree, Luke. The DTG technology is definitely getting the momentum, it is the way to go. I hope the prices will come down fast. It is still rather expensive for the moment.

 

[jdr8271]

It wouldnt cost 100K to get started. You could get a t-jet, a heat press, and a nunch of blanks and be in business for about $25000, assuming you could program the website yourself.

 

[CoolHandLuke]

Yes you can get a single T-Jet for 15K, but I was thinking more along the line of the BIG daddy!

 

[suzieh]

No only because I think it'll take more than $100,000 and what country if not the US. You have staff, building, equipment, insurance, liability plus the web/tech needs/costs. And customer service costs. And keeping up with changes in industry, returns, raw materials. I don't know which country either...if not US. Just some thoughts. Overall, I feel there's a need especially if there's a market say in a country or region that doesn't have many choices.

 

[Sac printer]

Any idea what it would cost to outsource the website (prograaming) side of it?? I would start with a smaller machine like the t-jet 2 and if things get busy you can always add another. I have seen them listed for 12k in the classified adds at http://www.screenprinters.net/ .

 

[apexos]

It seems that everybody chooses option 1. Any other opinions.

Any idea what it would cost to outsource the website (prograaming) side of it??

The website is the easier part. It is the backend subsystems that will be huge and costly. You have to have customer support, order tracking, shipping, payment, accounting as well as manufacturing subsystems etc. It is not easy to get all these integrated and running smoothly.

 

[Rodney]

I wouldn't do it. There are better ways to spend 100K and make a profit

Like CHL said, you're going to need more than money, you're going to need an angle to make people want to use your service.

There are more print on demand companies out there besides cafepress/spreadshirt. And there's a reason why they aren't mentioned much

 

[jdr8271]

I agree with rodney, but thats not to say that you couldnt make it work. Rodney is right...you have to have an angle.

Maybe you could be the only t-shirt fulfillment company that uses only sweatshop free american made t-shirts. Thats an angle that has made American Apparel alot of money, and by no means where thay the first company in the t-shirt business, or even the sweat shop free t-shirt busness.

In my mind, the hardest part of setting up a company to compete with cafepress would be the extensive advertising that would be necissary.

 

[apexos]

I agree with rodney, but thats not to say that you couldnt make it work. Rodney is right...you have to have an angle.

Totally agree. I have to have an angle. This is what I have in mind:

To provide comparable products and services at lower prices, that means higher margins for shop owners. I'm thinking about 15-20% lower base price s. The current base prices for CP/SS is rather high, it leave the shop owner little room for profit. If someone can provide comparable products and services at a more competitive margins, it might be an good angle. Any other angles that I should consider?

 

[CoolHandLuke]

I know the angle! Just not sure if I want to do it yet. I know of this angle becasue I'm dealing with it now.

The main question is... will everyone have a T-Jet in two years for $1200?

Tough question.

 

[funtimesx]

The big thing I'd like to see in such a service is more reasonable shipping costs to international (e.g not US) destinations.

I'm in Australia and frankly, I think CP's cost of $7USD for the first item ad $4USD each item thereafter is a complete rort. I am absolutely certain they're either (a) making money off shipping or (b) being incredibly inefficient about getting better international shipping rates.

It's possible the US market for "on demand" services is saturated, but those of us in other countries would LOVE a more financially viable alternative. If you can keep base prices reasonable and have decent shipping rates, I'd be interested (and it wouldn't have to be DTG - professional heat press would be OK if the price was right).

 

[Rodney]

To provide comparable products and services at lower prices, that means higher margins for shop owners. I'm thinking about 15-20% lower base price s. The current base prices for CP/SS is rather high, it leave the shop owner little room for profit. If someone can provide comparable products and services at a more competitive margins, it might be an good angle. Any other angles that I should consider?

I don't think pricing is too much of a concern for the majority of ss/cp shopkeepers, so I don't think that would lure many folks away.

The ease of use (simple user interface) and range of products, coupled with the stability and support the company's provide help people stick around.

You would need something totally different like the "sweat shop free" angle that JDR suggested.

 

[monkeylantern]

With $100,000, there are much, much better investments.

 

[funtimesx]

With $100,000, there are much, much better investments.

Maybe, but it could be something s/he is passionate about? I so wish there was a CafePress style site that was based in Australia - if I ever won Tatts or otherwise had large amounts of money to burn, it's something I might consider doing.

 

[monkeylantern]

If tshirts are your thing, you could set up your own threadless scale shop very nicely with $100,000, and have far more potential for profit once you get into wholesaling than a CP style outfit.

That also seems far more rewarding to me.

You have to differenciate yourself from the very efficient competition. "Being cheaper" may not be possible...have you crunched the numbers on how long it would take to get back in the black with your figures? It seems like a very dangerous market to enter, especially with the prospect of direct garment printing becoming possible economically at home within the next five years.

I think Cafepress etc are going to have to radically restructure in the medium term, stressing their quality as a fulfilment service, customer service, packaging, turnaround etc, over their actual printing, to cope with the rate of home technology.

 

[apexos]

I did some rough estimate of costs:

Blank shirts : $3.0
Ink and Paper : $1.0
CC payment gateway : $1.5 (based on $20 selling price).

If the base price of the shirt is $12 (which is 20% less than CP's $15), it leaves me $6.5 per shirt to cover rent, labour, marketing, website hosting and other software, customer support etc. The cost structure is pretty much the same as any internet t-shirt store with the following differences:

1) Higher costs for customer support, payment/commission handling and payment fraud screening.
2) Lower marketing cost, cos shopkeepers will draw in customers.

Is my thinking on the right track? Any suggestions?

BTW. I checked my local post office, the air mail rate is about $4 per shirt for most parts of the world.

 

[monkeylantern]

Did you ask about business post? Free pickup and significant discounts are common when shifting over 80 parcels a week.

 

[funtimesx]

BTW. I checked my local post office, the air mail rate is about $4 per shirt for most parts of the world.

Surely you're not telling me it costs $8 to post two shirts? I know here (and I would have thought most places) it kind of slides - the first item is more expensive, but often you can post two for the same price (e.g here we have a 500g satchel for $3.9, you could probably fit at least two shirts into 500g?).