Pricing & Margins
Part of Scaling a POD catalogue
Deciding when a successful POD product justifies stocked production
Use variant demand, complete batch costs, leftover-stock scenarios and cash needs to decide whether a proven POD item should move into stock.
Move to stocked production only if the exact POD item sells repeatedly, the specification is stable and a realistic batch comparison still works when some units remain unsold. A lower unit quote is only one input. A batch commits cash to a design, size and colour mix before customers order those units.
Establish the demand you can use
Use completed, non-test orders over a stated period. Keep cancellations and refunds separate. Record selling price, discounts, fulfilment and delivery charges, and the mix of sizes or colours. Total orders can conceal weak demand for individual variants that a batch would require you to buy.
Check whether sales depended on a temporary promotion, seasonal occasion or unusually large order. Do not turn a short run into a steady monthly forecast. Ask how many units of each proposed stocked variant could reasonably sell before the design or product needs to change.
Compare the full routes
Ask for a written stocked-production specification, minimum order, unit cost, set-up charges, production lead time and reorder terms. Add inbound freight, storage, packing, outbound delivery, payment and selling fees, likely remedy costs and stock-handling work. Compare the same item and customer destination against its current POD route. Use amounts on a consistent GST basis appropriate to the business.
| Decision input | POD route | Stocked route |
|---|---|---|
| Production payment | Charges follow the chosen supplier's per-order terms | Batch payment follows the quote's terms |
| Variant risk | Check continuing availability | Buy the forecast size and colour mix in advance |
| Dispatch work | Follow the supplier's order path | Store, pick, pack and send stocked orders |
| Leftovers | No finished batch from that design | Unsold units still need a realistic value and plan |
Model fewer sales than expected, a working forecast and stronger demand. For each case, show cash paid for the whole batch, revenue and costs from units sold, and the number and likely recoverable value of units left.
Keep cash exposure separate from profit. Do not charge the full batch payment as an expense and then count the same leftover units as another loss; account for inventory value and other costs separately.
A cash-recovery check can show how many stocked units must sell for receipts, after per-sale delivery, packing, selling and remedy costs, to cover the upfront batch and inbound payment.
If the remaining amount per sale is zero or negative, sales cannot recover that outlay under those assumptions. Use actual quotes rather than a universal sales threshold.
Key Financial Considerations for Stocked Production
- Cash paid for whole batch
- To be determined from quoted batch cost (GST-inclusive)
- Revenue from units sold
- Based on selling price, minus delivery, packing, selling and remedy costs
- Likely recoverable value of leftovers
- Estimated based on resale or scrap value
- Units required to break even
- Calculated after deducting all per-sale costs from revenue
Check the operational change
Stock creates an availability promise. Plan how receipts, sales, returns and damaged units will be recorded, who will pack orders and when replenishment will be considered. Regularly review stock records and sales trends, and check for items that are not selling, as excess stock can tie up cash.
If fit, material or print finish matters, approve a production sample against the written specification before committing to a batch. One sample informs that configuration; it is not a defect-rate study. Recheck images, sizing, care information and delivery estimates if the blank or print method changes.
Make the decision
Stock only the variants whose conservative case and cash commitment the business can support. Keep uncertain variants on demand if that serves buyers. Record the decision date, quotes, assumed sales period, batch quantity and review trigger. Revisit the choice when actual sell-through or returns differ from the forecast.
Steps to Decide on Stocked Production
- Compare full costs: POD vs stockedInclude production, freight, storage, packing, delivery, fees, and remedy costs (GST-inclusive)
- Model conservative sales scenariosAssume lower-than-expected sell-through; calculate cash recovery needed
- Assess operational readinessPlan for receipt tracking, returns, damaged goods, and replenishment timing
- Make decision and record detailsDocument date, quotes, assumed sales period, batch quantity, and review trigger
