Quick answer
A $35 tee with a $13 blank, $4 printing and $1.32 of card fees keeps $17.17 a unit before returns — a 49.1% margin. After a 2% return rate, 300 units a month net about $5,049. The margin, not the price, decides whether a design is worth promoting.
How the Merch Margin Calculator works, step by step
Enter the retail price, the per-unit base cost (the blank garment or product), the print cost, the platform fee percentage, the transaction percentage and fixed fee, shipping charged versus shipping cost, monthly units, and the expected return rate. The calculator returns profit per unit, margin, return-adjusted profit, monthly profit and markup.
The stack is: price minus base cost minus print cost minus platform fee minus transaction fee, plus the shipping net (shipping charged minus shipping cost). At the defaults, a $35 tee loses $13 to the blank, $4 to printing and $1.32 to card fees, and gains $0.49 from shipping, leaving $17.17. The transaction fee is 2.9% of the price plus $0.30 — Stripe's standard US card rate.
The platform percentage is the swing input. On your own store it is 0% and only card processing applies. On a marketplace storefront it can be 10% or more: at $35, a 10% platform fee removes $3.50 a unit, cutting profit to $13.68 and margin to 39.1%. The same design can be a good product on one channel and a bad one on another.
Returns are modelled as a reduction in profit: the return-adjusted profit per unit is the base profit multiplied by (1 - return rate). At a 2% return rate, $17.17 becomes $16.83 — about $0.34 a unit across the range. Defects and print errors are the provider's cost on print-on-demand, but size exchanges and buyer's-remorse returns are typically yours.
Use the per-design numbers, not the store average. Merch lines typically have one or two designs carrying the range; the calculator identifies which designs clear your target margin at their real volumes and which are catalogue decoration. Print-on-demand costs bundle garment, printing and fulfilment into the base price, which is why the unit cost looks high next to bulk buying — the fair comparison adds bulk's printing, storage, unsold sizes and packing time to the blank price.
The formula
Profit per unit = price - base cost - print cost - platform fee - transaction fee + (shipping charged - shipping cost). Margin = profit per unit / price x 100. Return-adjusted profit = profit per unit x (1 - return rate).
Worked example — try it on the calculator above
Worked example: a $35 tee, 300 units a month
Price $35, blank $13, printing $4, no platform fee, transaction fee $35 x 2.9% + $0.30 = $1.32, shipping charged $4.99 against a $4.50 cost = +$0.49. Profit per unit = $35 - $13 - $4 - $1.32 + $0.49 = $17.17, a 49.1% margin and a 105.9% markup on the $17 production cost. After a 2% return rate, adjusted profit is $16.83 a unit and 300 units net $5,049.45 a month. Add a 10% platform fee and profit per unit falls to $13.68 — the monthly total drops to $4,020.45 on identical sales.
Frequently Asked Questions
What margin should merch aim for?
Print-on-demand merch commonly targets 30 to 50% margins because the provider's base price includes production and fulfilment. Bulk-owned inventory targets 55 to 70% to compensate for the capital and unsold-stock risk. Below a 25% print-on-demand margin, small fee or shipping changes turn designs unprofitable — raise price or change the product before spending on promotion.
Is print on demand or bulk printing better?
Print on demand wins at low and uncertain volume, for testing designs, and where sizes multiply inventory risk. Bulk wins once a design's volume is proven — typically a few hundred units — because the per-unit cost advantage compounds. Most established creator stores run both: print on demand for the long tail of designs, bulk for the two or three proven sellers.
Who pays for returns on print-on-demand merch?
Defects and print errors are the provider's cost. Size exchanges and buyer's-remorse returns are typically yours: you refund the customer, and the returned item usually cannot be restocked through the provider. Price with a returns allowance (3 to 8% of units for apparel) so a normal return rate does not erase the margin.
How should I price a first merch drop?
Start from the margin, not from what feels affordable: set the price that returns your target margin at the print-on-demand base cost, then check it against comparable creator stores (hoodies commonly sit at $45 to $65). If the price looks unreasonable for the product, the product or provider is wrong — discounting into a thin margin at launch leaves no room for the sales and offers you will want later.
Estimates, not advice. This calculator provides educational estimates based on the inputs you enter and the assumptions shown on this page. It is not financial, tax or investment advice, and it cannot see your full situation. Verify important figures against official sources, and consider a qualified professional for decisions about your own money. See our Disclaimer and Methodology.