New Commission Model Part I: The Affiliate Commission

you guys are ripping us off, the base price of one of your shirts is $10.99 and once I put a design on it bumps up to $18.99 my design reads as $8 instead of $5.00. Who gave you the rights to my art that you can jack up the price. You kill our chance of even being able to compete with other brands. Secondly, that $20 Base price shirt plus our art and whatever scam you got going on turns that shirt into a $35 shirt. You are not being transparent.

This is very disappointing. We are a small non-profit and were looking for a way to offer multiple items to our supporters. The overall prices were higher for products than we would normally offer, but we decided a $5 mark up for items would help us and avoid the shipping/ordering hassles if we were to order from somewhere in bulk and mail out ourselves. This new scale will cut down our limited profits, which will not qualify for any volume discounts, and still increase prices for our supporters! What a disappointment. We just established our store and were excited with the possibilities it offered us, but now it just seems to not even be worth it. The costs are too high for our supporters to purchase these items, and our commission will be too low. We pay design fees for many of the items, so as far as being a solution for small non-profits to offer quality merchandise, spreadshirt has now failed.

Spreadshirt is suffering a serious case of poor communication. Yes, customer prices are increasing quite a bit, but Spreadshirt is bringing prices in line with the marketplace, where they have experience knowing how to price things. The price increases only give Spreadshirt more of a share of the product for low volume sales. If you sell lots of items, Spreadshirt’s commission model gives you possibly the most generous commission of any POD.

Spreadshirt, existing shop owners can see customer prices increasing dramatically. Until you address this directly, you’re leaving people feeling conned, especially because the calculator shows many products increasing in price while also reducing shop owner commission (at low volume).

It would also do you well to fix the illustrations. The one above says that you are keeping prices the same and reducing your share of commissions to increase ours. The reality is that prices are increasing across the board and that Spreadshirt’s share only reduces relative to its current share at high volume (and at higher commissions that the 20% shown in the illustration).

Treat your shop owners like partners. Tell them what’s going on without trying to hide anything. When we express confusion, fix the documentation. If you want us to invest a portion of our lives building big shops, you need to work hard to show that we can trust the foundation.

So is the product type price increasing also?

My calculator is saying that a shirt that use to cost 6.50$ is now 10.99$??

I only realized tonight the significant changes. What’s more significant is I have worked on my project before making it go live since April 2015. After this forum, looking at my increased prices, and the new model, I’m wondering if I will stay with Spreadshirt. Again, I’ve been working since 2015 on my shirts, learning graphic design, and diligently crafting the end result. However, the price increases are just too high for customers, and I am almost 99% sure I will be leaving. I also have a few dozen friends thinking of the same thing. As well all know, this chain reaction can lead from one to potentially thousands in lost revenue. The opposite of what I believe Spreadshirt is hoping. Is this a bad thing? Yes and no. First the yes. On reflection do I really want customers of my website being redirected through another company at margins that don’t really pay me what I could with dozens of other online shirt sellers? not really! The bad thing….Spreadshirt seems to have the most intuitive set up I’ve experience with an incredible layout for customers to view your products, especially when imbedded in your website. This is good. They also have a great return policy and I’ve ordered one product for testing, and can say the shipping was fast and the shirt looked great. I would actually prefer the latter, the intuitive set up for customers, but all of these changes, and with the prices sky rocketing high (that is not what I want my customers to see), I’m afraid it’s not looking good for my loyalty.

This is WAY over-complicated! Red Bubble use a single percentage mark up price on everything sold. Simple.

So true Kirk! I’ve already found a few better options surprisingly enough!

This is interesting! It will definitely take some fiddling around with to get the options right and commission per item back to normal for my shops. The price of designs on the market will go up drastically since you will need to increase design price in order to keep profits the same. That being said, you can always upload one design with a higher price for your own shop and one design for the market for other folks to use. Perhaps I could make this work to my best interests but it seems that Spreadshirt is just doing what is advantageous for them. I’ll have to take a closer look at the math once it is finalized and in effect.

As an update to my last comment, it turns out that the above illustrated example is quite wrong. It shows Spreadshirt lowering their share of the product by about 5%, whereas the calculator is showing that Spreadshirt is increasing product prices by 10% to 20% (beyond the newly incorporated 20% commission). Here’s the proof:

https://www.spreadshirt.com/blog/2016/03/16/qa-session-the-affiliate-commission/comment-page-1/#comment-321763

Thanks for the update Thomas. The commission diagram above makes sense to me, but the calculator is doing more than just applying that structure. As I have shown, it is also increasing base prices. So it isn’t just our “thoughts” that require consideration, but also the output of your calculator.

It’s clear Spreadshirt is trying cover up what they are really doing. They are playing shop owners for fools, and I for one am a little upset about it. Just doing simple math you can see that they plan on increasing their shirts by a lot. They are taking a greater portion of the profit, while minimizing the overall profit a shop owner can make. That is evident by them eliminating shop owners being able to add commission on designs they pull from the marketplace. You can no longer add your own commission. You get 20% or nothing. Yes, they give you a “bonus” if you sell enough shirts but that is just a clever way to make you feel better about what they are doing. Spreadshirt won’t survive this change if they go through with it. There is no way anyone will want to pay the higher prices when you can go elsewhere and get a 20.00 shirt. What’s the point of running a shop if you can’t make money? Spreadshirt needs to seriously rethink this terrible idea. No more “Wait until April” from Spreadshirt. We all know what they are trying to do with all of that. Their new “Bonus” you have to sell 10 shirts in 2 weeks to even be considered for it. Not sure why they are telling everyone to wait. It’s easy to see the real winner in this is Spreadshirt, certainly NOT the shop owners as every owner will now be making at least 50% LESS per sale.

This is a really dreadful change that over-complicates the system, takes freedoms away from your shop partners, and in the end, costs us money under the guise of “a new system to make it easier for our partners”.

I really hope that this is drastically overhauled or scrapped entirely. The fact that we need calculators just to understand this convoluted system is not a good sign.

My prior comment showing price increases includes an error. The calculations show base price increases of 9.3% to 19.2% for the 3 products examined, not of 9.1% to 26%. The latter numbers failed to normalize the 20% commission first and so only show my shop’s price increases, while the former (correct) numbers are independent of commission.

One solution you can do is make a duplicate of your design for the marketplace only and have that one marked at $4 per design. Since the Marketplace isn’t affected.

For your shop, you’d just drop your design fee on those products by 20% and your final price for customers would stay the same. Just an idea. Some people have too many designs to be adjusting though and duplicating.

Thanks for fixing the calculator Lena. I feel much better now! Most Shop Partners will probably be fine with the changes.

Thank you for your response, Lena. This makes much more sense now, but I still don’t like it. If I understand this correctly, Spreadshirt is basically taking away a lot of my ability to control the prices of my products.

For example: Right now I sell t-shirts for $20 and make $9 from mark-up, with no design commission. I also sell hoodies with the same designs for $35 and make $4.20 from mark-up, with no design commission.

If I understand this correctly, under the new system, if I continue to have no design commission, then I will earn only $3.10 per t-shirt, and my shirts will cost my customers $15.49. If I want to bring the price of the shirt back up to $20.49, then I can charge $5 in design commission, and I’ll make a total of $8.10—slightly less than I’m making now. This slight loss doesn’t bother me that much.

But the bigger problem is that if I set my design commission at $5, then when someone wants to order a hoodie with that same design, the hoodie will cost them $46.49 ($41.49 + $5), correct? There’s no way my customers will pay that much for a hoodie. Please tell me whether all of my math is correct, because this all has been pretty confusing for me.

So essentially I would need to choose between (1) having no (or very low) design commission and making almost nothing off of my t-shirts, or (2) increasing the price of my hoodies, probably putting an end to those sales. Do I have that right?

Not sure what to really expect here. It was worded like a Kindergarten student. Essentially, we can keep the Product Markup in place, however you are now charging us a design + affiliate fee. So if you were making $10.00, you will now only make $4.80. However is the cost of the shirts going down? What type of gain can we see here? Because frankly, all I see is a loss.

I have a t-shirt design where I have agreed to only mark up the price $1.00 for that person’s design that he wanted his fellow military members to pay for the shirt. I made the design fee $1.00 and my markup zero. How will this be affected?

Exactly how much will the product prices increase, not including commissions?

According to the calculator all my items will cost $10+ more and I will make LESS money or a few cents more on everything.

Not sure how great this is going to work out for me.