Pricing Merch: What to Charge and Why Cost-Plus Gets It Wrong
By The Velocity Wear Team
Most merch is priced by taking the unit cost and applying a multiplier. That is a reasonable floor and a poor method, because it prices the garment rather than the thing being bought — which is affiliation, and which has an entirely different value to the buyer.
Start with the floor, then ignore it
You need to know your landed cost per unit, including decoration, freight and any duty, plus the fulfilment cost per order. That establishes the price below which you lose money. It does not establish what you should charge.
The gap between those two numbers is where the decision lives, and cost-plus pricing pretends it does not exist.
What buyers are comparing against
Not other hoodies. Someone buying merch is choosing between supporting you and not supporting you, and comparing against other ways of doing so. That is a completely different reference set.
It also means underpricing can hurt. Merch priced conspicuously below the market reads as cheap merch, which reflects on the thing it represents. A price consistent with a quality garment supports the perception that the garment is one.
Practical anchors
- 1**Compare against retail garments of similar quality,** not against the cheapest available. If your hoodie is genuinely heavyweight, price it against heavyweight hoodies.
- 2**Round numbers for physical sales,** where queues and cash make change a real cost.
- 3**Have more than one price point.** A cheaper item captures people who will not spend on a hoodie and makes the hoodie look reasonable by comparison.
- 4**Price bundles as bundles,** so the individual price is not undermined.
When the numbers do not work
Sometimes your cost makes the sensible retail price impossible. There are three honest responses and one dishonest one.
- **Increase quantity** to reach a better tier. Our pricing runs from base at 20–49 pieces to up to 40% off at 1,000+, so volume genuinely moves the floor — provided the units will sell.
- **Simplify the decoration.** Fewer colours, one placement instead of three. Frequently improves the design as well.
- **Change the garment.** A different blank at a similar quality level can move the cost meaningfully.
- **Do not thin the garment to hit a price.** This is the dishonest option. It produces something nobody wears, which costs more than not making it.
On discounting
Discounting merch damages it more than most products, because the price is part of the signal. A hoodie marked down to half price says the affiliation is not worth much.
If stock is not moving, bundle it, give it away for a reason, or hold it. Those preserve the position in a way a public markdown does not.
