How to Start a Screen Printing Business (and Make Nearly $1M/Year)

  • by Brandon Boushy
  • 2 weeks ago
  • Blog
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Man screen printing

Have you ever wondered how to start a screen-printing business? You can start screen printing with $10,000 or less. We’ll show you how to make a great living running a screen printer.

Forrest Wedmore and Clint Graham started The Foundry in 2010 as a custom t-shirt company. The screen printing company that they were using was struggling and sold them the screen printing equipment for $10,000. 11 years later the Foundry is making nearly $1m per year!

Forrest took the time to explain they started The Foundry. He gave us a ton of great advice about how to start your own t-shirt company that we’ll include while providing a step-by-step guide to start a screen-printing business.

Step 1: What’s the Best Way to Start a Screen-Printing Business?

The first step in the process of starting a screen printing shop is to research to determine whether a print shop is right for you. Screen printers can make great money, but every business owner has a different mindset.

You may want to run a store focused on a specific group, such as company t-shirts, one that caters to everyone, or you may want a warehouse where you focus on e-commerce.

You aren’t limited to just one type, but the type of printing company you choose will impact every decision you make going forward.

The Foundry focuses on printing, embroidery, and selling custom garments. Forrest told us:

We primarily focus on garments for sporting goods because they have a ton of relationships with surf shops and other stores.

Many consumers start their shopping experience online, so a shop that can sell clothing in person or online is recommended to start your clothing line.

Keep reading for different types of printing companies.

Printing for Private Label T-shirts

Man screen printing using a blue-green textile paint

This is the type of printing Forrest does. Printers focus on printing for specific brands. 

A business plan using this model typically focuses on a niche market to satisfy their needs and may expand into other markets later while maintaining the same brand.

Franchise

A franchise is just a business that has already developed a reputation and business processes. They let owners purchase the right to use a company’s branding and process in exchange for a licensing fee and percentage of revenue.

Franchises also help you with aspects like marketing, sales, and sourcing equipment. To learn more about starting a franchise printing company, check out our blog about Big Frog.

Retail T-shirt Printers

Printers that operate this way are commonly in malls and have shops that focus on retail customers that have small order sizes.

They’ll typically have a higher price per shirt, but that’s because the costs associated with the screens and design are covered by a smaller order than bulk print orders.

With the rise of eCommerce, this part of the industry is hurting. Closures of retail stores have been increasing for at least the last 3 years according to Moneywise.

Despite this, Digital Commerce says retail sales have increased around 3% per year since 2007, meaning locations that stay open make money.

This business model works with franchisees and stores that run a tight ship. They tend to need sales of $40k/month to be safe. Otherwise, you’ll probably want to start a different way.

That is comparable to what Forrest told us about his costs:

I have to make around $1,200 per day to break even.

Printing for E-commerce

A laptop showing the word "e-commerce" on a desk

Many clothing companies, print-on-demand companies, or other e-commerce businesses hire a printer to press and ship the clothing their customers order from their website.

Printers can make great money doing this because they will typically get an additional payment for handling the shipping.

How much does it cost to start a screen-printing business?

Forrest told us “We started the business with $10,000 and a U-haul.”

When starting a screen-printing business, start-up costs can range from a few hundred dollars to $150k for a franchise.

Is a screen-printing business profitable?

It can be profitable as they are making around $3,500 per day, but you’ll need to control the expenses in the early stages of the company.

Step 2: Learning how to screen-print

The next step is learning how to start screen-printing. Some of the skills you might need include:

  • Design.
  • Technology.
  • Business Skills.

Let’s dig deeper into each of these to see how they impact starting a screen printing and embroidery business.

Design Skills

Before you can begin screen printing shirts, you’ll need a design for your screen printing press or other types of printers.

T-shirt designs will typically be designed using digital software, like Photoshop or Illustrator. Adobe has a ton of tutorials on how to use both.

If you are using a screen printer, you’ll then create the screen from the design, which we’ll go into later. If you want to avoid this step, there are other types of printers.

For instance, a direct-to-garment printer costs around $22,000 for the printer and the software. This equipment allows you to go straight from design to print.

 Technology

The next skill you need to develop is familiarity with the technology aspect of the industry. The technology falls into two categories:

  • Production and screen printing skills.
  • Technology to support your business.

Let’s look at each.

Production and Printing Skills

A man screen-printing a t-shirt using a white textile paint

Your screen printing business will need to produce t-shirts,  and you’ll be doing it. Otherwise, you should research print-on-demand companies like Printful.

If you don’t already print garments, you’ll need to learn how to operate different types of machines.

Some of the typical techniques you’ll need to learn include:

Forrest walks you through the direct to garment printing process at the 8:14 mark of the interview.

Printsome offers a good infographic on deciding what kind of technique you want to use.

The best way to learn these screen printing and heat transfer techniques is hands-on, which means purchasing your own machines or finding someone who will teach you.

Other ways to learn t-shirt printing skills, like heat transfer, are YouTube videos and manufacturer training courses. Just search “screen printing training courses” to find great resources.

Technology to support your screen printing business

I’ve seen people spend $25k to not get what they want from technology investments. It’s important to understand the technical aspect before you start.

Technology that will need to be used includes:

This information is really important when trying to figure out how to start a t-shirt printing business because a great website and software can save you time and allow you to expand your customer base to a national or global level.

If you want to learn more about building a website, check out our blog How to Create a Website.

Most tech companies offer a free trial or low-cost tutorials on how to use their software. Make sure to use them. They were built to help you make the most of their offerings.

Business Skills

Business skills cover a wide range, including accounting, pricing, shipping, and managing inventory.

To educate yourself on all of these would be a lifetime of learning. We’ve provided a list of useful resources for getting more familiar with the subject matter:

You can also use YouTube videos to learn almost anything these days.

Marketing

A laptop on a desk with the word "marketing' on the screen

Marketing is about going where your target audience is to help them become aware of your screen printing services. Marketing can be done both online and through other channels.

Three of the largest marketing companies expect digital marketing to make up over half of all ad spend in 2021. To read more of their insights, check out this blog.

You’ll need to be familiar with the largest places where you can market your print shop:

It’s important to have social media accounts connected when starting a screen-printing business. They help drive awareness, give you a channel to connect with customers, and allow you to set up shops to sell your products.

Each site has a ton of resources to educate people on their marketing tools. Make sure to familiarize yourself with them; otherwise, you’ll be operating in the dark and wasting a lot of money.

Marketing is focused on developing awareness of the organization and turning those who are aware into paying customers.

Step 3: Shirt Business Name

I can’t stress enough the importance of what you name your company. It will communicate what the company is all about. Keep reading for best practices.

Does the name explain the business?

The Foundry Co does not clearly state what it does: screen print and embroider clothing and other products. It references metalworking both in the name and the logo.

I feel like this is something that could make running a business a challenge, but the name also conveys the idea of well-made craftsmanship.

The easier it is to identify what the company is focused on, the easier it is for your target audience to find it while preventing wasted spending on industries that use similar wording.

Is it easy to spell?

Make sure your business name is easy to remember when using a search engine.

A crazy name like Onomatopoeia Printing makes searching for your business difficult cause it’s hard to spell. The Foundry is easy to spell and remember.

Because people tend to type fast, it can be helpful to register domain names for common misspellings of your company’s name and forward them to your website to make it easier for customers to find you.

Location

Including your state, county, or city identifies you as a local business. For example, Windy City Screen Printing would be focused on screen printing in Chicago.

Branding

Does your name fit your branding? Some business owners focus on visual ideas for a logo before a name. The Foundry’s logo looks like this:

The foundry print shop logo example

The saving grace for the logo is they include the word “print shop” in the logo. Without that, it would be hard to tell what it is. Make sure to make it easy for people to understand what your company does.

Register a .com

Find a name for which the .com domain is available. It’s the most recognizable. You can search by clicking here.

Give it a go!

See how people like it. Make sure to check what happens if people shorten it. 

You wouldn’t want to name a business Super Crazy Athletic Tees because it would get shortened to SCAT, and you don’t want that to be associated with your brand.

Check Google Trends. Read articles like Five Tools for Naming a Business. Finally, register your business name with the government.

Step 4: Write a T-shirt Screen Printing Business Plan

You need a business plan to help define your vision for the screen printing company’s objectives and strategy.

Its purpose is to drive the direction of your screen printers’ decisions, secure financing, and develop partnerships with other businesses. 

Having a flexible business plan that is constantly evolving is a great approach to the process and allows for businesses to pivot when necessary. Here are some resources to help with this step.

Templates

We’ve gathered templates to help you develop your business plan. Here are some of the best:

Resources

It gets better! Here’s some free and low-cost education on business plans:

Step 5: Establish the legal structure to screen-print

You’ve created a name and business plan. It’s time to establish the legal structure. For best results, hire legal representation that has experience starting a business, like an attorney, accountant, or tax specialist.

They’ll help you get your business started quickly so you can start printing faster.

Licenses, permits, and tax forms

Approval of business license and permit

Each location has different licenses, permits, or tax forms required. Use the SBA License and Permits page to identify what your custom tees company needs. Keep reading for information on different legal structures.

Sole proprietorship

A sole proprietorship is the easiest way to start a t-shirt business, but the structure doesn’t protect the owner’s assets from legal issues.

That means if something goes wrong, you could lose both your printing company and your home.

This structure should only be used if you can’t afford an LLC because shirt businesses have work and materials that can cause injuries to employees or customers.

To start a sole proprietorship, fill out a special tax form called a Schedule C. Sole proprietors can also join the American Independent Business Alliance.

Limited Liability Corporation (LLC)

An LLC is the most common business structure used in the United States because the company protects the owner’s assets.

It’s similar to partnerships and corporations but can be a single-member LLC in most states. An LLC requires a document called an operating agreement.

Each state has different requirements. Here’s a link to find your state’s requirements.

People may register in specific states due to the cost of doing business. Delaware and Nevada are common states to file an LLC because of their business-friendly laws. Here’s a blog on the top 10 states to get an LLC.

Partnerships and corporations

Partnerships and corporations are typically for massive organizations or legal firms. Unless there is a specific reason you need a partnership, it is better to do a multi-person LLC.

Investopedia has good information about partnerships and corporations here.

Franchise

An iPad with colored pens on a desk

There are several opportunities to purchase t-shirt franchises.

Franchising.com has two franchise opportunities in the United States that allow you to start a t-shirt business using a reputable company’s name and business processes.

A franchise makes it where an entrepreneur can benefit from the reputation of an established clothing printer that has already worked out many of the kinks of starting from scratch.

Step 6: Getting Ready for Customers

Your screen printing business is now an entity, but there’s more to do. 

The order you do the rest of the steps will depend on the resources you have, your skill sets, and the type of print company you are running.

There are six areas of business you will need to focus on to get you running:

  1. Location – Where will you be working?
  2. Equipment and Inventory – What will you have in stock and how will you pay for it?
  3. Employees – Will you have employees and how will you make sure it is a safe environment?
  4. Finances – How will you keep track of transactions and financial records?
  5. Insurance – How can you protect what you are building?
  6. Marketing – How will you find customers?

Step 7: Location

Finding a location will vary based on the type of screen printing business you are running. For instance, if there are certain major clients you are trying to target, being located near them can be beneficial.

Otherwise, you may want to choose the location based on the wealth distribution of the area, based on the price of space, or choose a central location that is convenient for more people.

When deciding to rent a space for a clothing line, consider:

  • How will I store equipment and inventory?
  • Is there space for a home-based office?
  • Will customers be coming to my location?
  • How much inventory will I have?
  • How much display space do I need?
  • How much space is needed to store inventory?

When opening a screen printer, you will probably need to rent space in your area. Whether the space is a warehouse, a storefront,  or U-Haul, you’ll need to plan to make sure you have the proper setup.

How much space do I need for t-shirt printing equipment?

A discussion in T-shirt Forums suggests a minimum of 320 square feet for a 6 color/6 station clothing printing machine.

That assumes you only have one screen printer machine. You’ll need more space for silk screen supplies, inventory, and office space.

Typically you’ll want about 500 square feet per occupant plus space for the tee shirt printing machine.

That means at the very least you’ll need about 900 square feet to make sure you have the space you need to work and store everything.

To find spaces to rent in your area, contact a local commercial real estate agent. You can search for them in your area here.

Step 8: Professional T-shirt Printing Machines and Product Displays

A printing machine inside a factory

A new screen printing business requires inventory. You’ll need the shirts you’ll be selling, product display stands, registers, computers for design, and the machines for adding designs.

You’ll need machines based on the different types of t-shirts. These can range from heat presses to DTG printers to embroidery stations.

A professional t-shirt printing machine that is recommended in other blogs is the Brother DTG Printers.

Starting a Clothing Line offers a list of manufacturers by location and type of clothing. It’s a great place to start when looking for manufacturers.

Used printing machines and product displays

Screen printing equipment for shirts and product displays can often be found at huge discounts if you buy them used.

You can find printers and product displays through most online markets, pawnshops, going-out-of-business sales, and other places.

If you are considering buying an existing business, the equipment, the suppliers, and the client list are the most valuable aspects of the company. 

Learn more about valuing an existing business in our guide about buying businesses.

Step 9: Employees

Forrest emphasized the importance of great employees. He told us:

I’d rather pay people well enough that they care about the business. We average around $3,500/day with 6 employees so we can afford to pay them. Invest in them and they will perform amazingly for you.

He also told us not to make the same mistakes he did. Screen printers tend to be creative. They have a different mindset than accountants. He said that every creative should have a great bookkeeper.

At first you might balk at the costs of hiring a great bookkeeper, but they are worth it. I wish I’d hired one much earlier.

When you hire employees, you’ll need to meet some obligations. Let’s discuss common requirements.

Tax filing and withholding

Federal and state tax filing requirements apply to new employers. You must keep records of employment taxes for at least four years, including special forms and accounting for state taxes.

Don’t worry! We’ve got you covered! Check out the IRS guide for employers here.

Federal employment and labor law posters

All employers must display Workplace Posters, which you can download from the website.

Other requirements include:

  • Employment Eligibility Verification (Form I-9)
  • State’s New Hire Program
  • Worker’s Compensation Insurance
  • Disability Insurance—varies by states
  • Occupational Safety and Health Administration (OSHA)

Job Posting

An iPad and a cup of coffee on a desk

Hiring people requires posting “now hiring” signs and posting on prominent job boards. Some places you can start posting job requirements are:

Interviews

Having a prepared list of questions for interviews can make hiring the right people easier. Indeed offers a variety of resources to help you make better hiring decisions. Read their guide: How to hire your first employee.

Given this is a skilled trade, I’d recommend having them do a physical test to identify silk screen supplies and show you how to do screen printing.

While you can teach someone how to operate a clothes printing machine, it’s easier if they know how.

Compensation

Employees are typically a company’s biggest expense. There are four common pay structures in business:

  • Salary
  • Hourly
  • Commission
  • Hybrid

Each fits different scenarios. Let’s take a closer look.

Salary

Flat weekly/monthly rate based on a person working a specific number of hours. This is typically reserved for owners, managers, and some admin roles. You might want to assign this to yourself for budgeting purposes.

Hourly

This pay structure just tracks the hours an employee works and pays them a set hourly rate. This pay structure is solely based on time, not performance.

In Portland, Sanford says, “I pay my employees $14 to $16 per hour.”

Commission

Typically used in sales to give employees a percentage of revenue. It is a strictly performance-based compensation model.

Hybrid Models

Hybrid models combine two pay structures — for instance, hourly and commission—to compensate for time and performance.

The hourly rate will typically be lower than an hourly rate without commission, but the commission should make it where high-performing employees make more than they would without commission.

These structures also help reduce the variability of pay from week to week.

Paying employees an hourly wage works for most screenprinting businesses, but depending on your business structure, a commission or hybrid payment model might make sense.

The article, “How to Create a Pay Structure That Promotes Team and Company Growth” offers some insights into thinking about pay structure.

Also check out payscale.com for estimates on how much to pay for screen printers in your area.

Step 10: Financial Management

An employee managing the financial records of company

A crucial portion of successfully starting a small business is managing the finances. Here are some tips and resources to help you get started with the financial management of your print shop.

Budget! Budget! Budget!

A budget is the most important tool you can use in business. Without it, your screen printing business might not make it through the first few years.

Some of the best free budgeting software includes:

  • dsBudget – open-source software that requires some development experience
  • Quickbooks – used by millions to make their accounting easy by setting up rules, directly connecting with their bank(s), and more.
  • Xero – I have some experience with them. I was introduced to them through an Australian client, and people love them. It allows you to automate most of your processes but is meant to be set up by an accountant and software developer so that the platform works specifically based on your location(s) tax needs.

Consider the many funding options

While Forrest started Foundry with a $10k loan from family, other printers we have talked to have started their company with less than $1,000.

In our interview with Marcus from Portland Gear, Marcus suggests beginners use the following:

  • Shopify
  • A print-on-demand company.
  • Social media marketing of less than $500/mo.

Common funding paths include:

  • Personal funds
  • A loan from family or friends
  • Funds from a business partner(s)
  • Government programs

The SBA offers free courses on financing options and funding programs. For info on using personal funds to start a business, check out this article from The Hartford.

Alternative sources of funding include:

Develop a pricing structure

Screen printing prices vary, so research the market in your area to come up with a good pricing structure. Forrest told us:

I typically mark up the cost of the shirts 100% and don’t allow people to bring in their shirts to print.

Step 11: Sales Tax and Insurance

Sales Taxes

All but five states and some cities (or counties) require sales tax. You can find a guide on applying for sales tax on TaxJar. After you register to pay sales taxes, you will need to keep track of the sales to pay them according to state laws.

I would highly recommend speaking with an accountant that specializes in taxes to help you comply with your business’s unique needs.

Insurance

Approval of business insurance

You’ll need unemployment insurance and worker’s compensation if you have employees. You may also want a general liability policy to protect against unforeseen events that could cause substantial losses.

Unemployment Insurance

Unemployment insurance protects employees from entirely losing income when they lose their jobs.

It is paid for on both the federal and state level. Federal unemployment insurance is driven by a 6% tax on the first $7,000 of each employee’s income, a total of $420/year per employee.

Your state taxes can reduce the federal portion down to $42/year per employee, but each state has different requirements. You can find a full list of agencies that deal with UI on nolo.com.

Workers Compensation

Workers Compensation is for when people are injured on the job. There are both federal and state requirements. You can find both federal and state requirements at dol.gov.

The policies protect against excessive costs when an employee is injured through acceptable business practices.

General Liability Policy

A general liability policy is not required, but it is highly advised if people other than employees will be at your location. It protects against lawsuits. Contact an insurance agent to get a quote.

 Step 12: Marketing

You’re ready to sell shirts. You have the location, equipment, inventory, and employees, but no clients!

How are you going to let people know you have a press, ink, and are ready to print quality tees?

Marketing is crucial!

Forrest stressed the importance of asking to show all your work on social media.

During the early stages of the business, getting clients can be hard. Make sure to ask if you can share the work you do. It will often bring in new people. The other business will typically share it as well to help you gain exposure.

That tip can save money during the start-up phase.

Other suggestions he had are:

  • Build relationships. Networking is what makes a business succeed. It pays off.
  • Continually focus on SEO. Start by familiarizing yourself with Google requirements.
  • Check the customers’ previous print jobs to give you ideas of how to sell more shirts.
  • Follow up! It makes a difference.
  • Try to upsell them. If you love their artwork, suggest putting it on stickers too.
  • Use analytics.

Using software like Hootsuite makes managing social media easier. You can schedule posts, assign team members to manage specific sites and access all your social media in one place.

In addition, they keep up with the requirements for each platform for you and update you when you enter the dashboard.

A CRM like Hubspot can make keeping track of clients easier as well.

You can integrate it with almost everything, including emails, invoicing, inventory, and your accounting to make sure that you know what is going on with every client. 

Influencers

Folder with influencer text and a pen on a desk

One of the best ways to learn what works in marketing and business is to follow others who rock their industries. Some of the top influencers to follow are:

Is it hard to start a screen-printing business?

Forrest told us:

You want to use automation. If you screen print manually for years, you’ll get worn out fast. You can make great money, but it’s hard work.

If screen printing T-shirts sounds interesting to you, ask yourself the following questions:

  • Do I have the required screen printing start-up costs?
  • Am I comfortable operating a screen printing machine?
  • Will I be comfortable speaking to clients?
  • Where will I buy my screen printing supplies?
  • Why am I starting a clothing business?
  • Do I need employees or advice?
  • What will I need to feel successful?

We’ve given you the steps to starting a screen-printing business. There’s just one more step: Start your own!

Let us know in the comments below if you have any questions, we’ll be more than happy to help!

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