How to start selling merchandise as an independent local news organization

Selling merchandise isn’t a major source of revenue for most independent news businesses — but there’s evidence it could be a growth opportunity with the right strategy and marketing.

The nonprofit newsroom Block Club Chicago, for example, earned more than $100,000 from a single campaign in 2019, and Burb Media in Pennsylvania makes more than 5 percent of its annual revenue from merch sales.

To dig into some tips for experimenting with a merch strategy, we hosted an “Ask Me Anything” (AMA) chat last month with Maple Walker Lloyd from Block Club Chicago, Kevin Tierney from Burb Media, and Mariko Lochridge from LION Publishers.

Here are a few highlights from that conversation, edited for brevity and clarity:

Q: What platform do you use for selling your merch? Do you recommend it?

Maple: Great question. Block Club Chicago uses Weebly. The platform makes it easy to charge shipping to the customer.

Kevin: We use Shopify for the most part, but we also use Merch by Amazon for some top-sellers. Both are fine to use, but definitely have some nuisances.

Mariko: I’ve worked with a number of entrepreneurs who have really enjoyed the Shopify experience. Shopify is great because they have a free consulting support system, and the platform supports nearly all payment methods. You can also use Wix for e-commerce, and Mailchimp has started some great in-newsletter shopping options that appear to be very effective.

Kevin: My issue with Shopify is that they don’t do returns. But the customers will complain to us, not them. We usually end up eating it and ordering a replacement. Amazon accepts returns and handles it on their end.

You can read this whole AMA conversation on Slack if you’re a member of the News Entrepreneur Community Slack group — or you can request an invite here.

Q: How do you avoid printing more merch than you’re able to sell? Have you ever done a pre-order sale, and what’s the timeline for something like that?

Maple: Utilizing pre-orders was key to seizing on the Gator Watch opportunity without over-purchasing merch — plus it allowed us to start selling T-shirts almost immediately.

Kevin: Everything we do is by print-on-demand, except for in-person events where we sell merch as a vendor. For those events, we only print popular items that we can add back to the Shopify store as things we ship directly.

Q: How long was it between when someone ordered and when someone received their merch?

Maple: Because of our established relationship with a local printer, they were able to rush print and deliver the order to us. Once we received the order, shirts were immediately packed by hand by reporters and editors and mailed to customers. Once mailed, local folks ordering the shirts typically got them in 1–3 days. In a pre-sale environment, it’s important to be upfront with the customer and transparent about the timeline.

Q: How is merch revenue split among the artist/designer, manufacturer and seller? What are the costs required to get started, and what are the margins for each sale?

Maple: Merch startup costs and margins will vary greatly depending on how you structure the deal. We paid the artist a flat rate up front, but you could structure it as a profit-share, for example. We also sold the shirts as pre-orders, which helped cut our up-front costs — we didn’t order shirts until readers paid for them in the presale.

Kevin: We try to make at least $10 on everything. But we eat a Shopify fee of $80 every month. Our preferred Shopify shirts are $11 I think, so we price most shirts at $22.50 to $25. Amazon doesn’t allow for that big of a profit, as they only offer a commission instead of allowing you to just mark up an item. So a $25 shirt nets about $7.25.

Mariko: Shirt costs will vary depending on the quality and the size of the order. When you print, there’s usually a setup fee around $150 or more. Other costs might include shipping, photography, ads, giveaways to important community members or promotion winners, packaging, staffing to help manage the project, and a designer.

Q: When working with local designers to create merch, how do you figure out how much to pay them for their time? Are there other types of compensation involved (e.g. a free membership)?

Kevin: It has been a mix for us. When Canva added a way to make T-shirt designs, I played with that on my own a little. But if there’s a shirt idea I know will sell, I have a couple people who will create my design for a $100 to $150 fee. Usually I have the entire concept in mind and just need it created.

Maple: The artist who designed the Gator Watch T-shirts was paid a flat fee.

Mariko: One fun idea I saw was a ‘contest’ where the winner not only received a cash prize, but also got their design printed on a wine bottle. There’s also a lot of great grants for the arts that a news organization could apply for. In Los Angeles, there are often neighborhood councils that pay local artists for mural or local event posters. I’d love for a local news org to apply for that money to hire a local artist to create promotional merchandise.

Q: Where do you get your design inspiration? What are some other tips for knowing what will sell?

Kevin: Our big sellers are topical. For example, we did a shirt when Barstool mentioned in a pizza review that Conshohocken was considered classier than Manayunk (another town nearby). We chase what is happening. We also have shirts with old logos from historic companies in the town, old bars, that kinda thing. But they don’t really sell.

Maple: Our limited-edition T-shirts designed by local Chicago artists have been wildly popular with our readers, like this one by Chicago artist Steve Shanabruch, known for his WPA-inspired prints of Chicago’s neighborhoods.

Q4: How do you manage acting quickly to seize an opportunity like Gator Watch without overextending your staff with fulfillment demands or over-purchasing merch?

Maple: For our Kickstarter merch fulfillment and Gator Watch fulfillment, the entire staff took an afternoon off from the news to pack T-shirts to ship. We also tapped volunteers to help. On a day-to-day basis, our editor-in-chief Shamus Toomey processes and ships our orders since we are still working remotely.

Q: What are your best-selling items, e.g. T-shirts, tote bags, or something else?

Maple: We’ve sold more T-shirts than anything else to date, in part because of our limited-edition partnerships with local artists.

Kevin: Most of our sales are T-shirts. Mugs are probably second and doormats third. Before the 2020 holidays, I bought some local art of the town and added puzzles and canvas art to the Shopify store and sold a few, but not worth the effort.

Mariko: T-shirts are one of the easiest and lowest-risk products if you’re just getting started. A lot of people also like pins and I have enjoyed working with Wizard Pins in the past. Understanding your audience is really important.

Q: How do you think about merch as part of your bigger brand? Are there benefits to selling merch beyond the revenue?

Maple: One of the coolest parts of merch is spotting people out in the wild wearing it, knowing that they supported your newsroom! We always strike up a conversation with them and ask what they like about our coverage or how we can better serve them.

Mariko: Merch is a GREAT way to build community. We especially see it with the TikTok generation that loves to wear their values on their apparel. They see something that resonates with them and they want to rock it. I think of it as bumper stickers on humans.

You can read this whole AMA conversation on Slack if you’re a member of the News Entrepreneur Community Slack group — or you can request an invite here.