Quick answer: Price café merch by calculating landed cost (product, decoration, shipping, packaging), applying a target gross margin (many cafés aim for about 50–65%), checking local and online comparables, and rounding to clean prices. Remember that markup and margin are different: doubling your cost is a 100% markup but a 50% margin. Use bundles to raise average order value and move slower items without discounting your brand.
Key takeaways
- Landed cost includes shipping, decoration and packaging.
- Margin ≠ markup: 2× cost = 50% margin.
- Comparables keep prices believable.
- Bundles beat blanket discounts.
Step 1: Calculate landed cost
Landed cost = product + decoration (printing or embroidery) + setup fees ÷ quantity + inbound shipping ÷ quantity + retail packaging
Illustrative branded mug:
| Component | Per unit |
|---|---|
| Mug | $3.20 |
| Printing | $1.10 |
| Setup ($75 ÷ 144 mugs) | $0.52 |
| Shipping ($60 ÷ 144) | $0.42 |
| Gift box | $0.60 |
| Landed cost | $5.84 |
Step 2: Markup vs. margin
| If you price at... | Markup | Margin |
|---|---|---|
| 1.5× cost | 50% | 33% |
| 2× cost (keystone) | 100% | 50% |
| 2.5× cost | 150% | 60% |
| 3× cost | 200% | 67% |
Price = landed cost ÷ (1 − target margin)
For a 60% margin on the mug: $5.84 ÷ 0.40 = $14.60 → round to $15.
Step 3: Check comparables
- What do other local cafés charge for similar items?
- What do national coffee brands charge online?
- Does your price feel right for the quality and design?
If your calculated price is far above comparables, look for cost savings (larger runs, simpler decoration) or reconsider the item. If it's far below, you may be underpricing your brand.
Step 4: Round to clean prices
Whole-dollar prices ($15, $22, $28) feel premium and are easy to ring up and remember. Prices ending in .99 feel more discount-oriented, which may not fit a craft café.
Typical margin targets by item (illustrative)
| Item | Common margin range |
|---|---|
| Mugs | 55–65% |
| Tumblers | 50–60% |
| Tote bags | 55–70% |
| T-shirts | 50–60% |
| Stickers, pins | 70–85% |
| Retail coffee beans | Set with your roaster's suggested retail |
Ranges are illustrative; your costs and market decide.
Bundles that work
- Mug + 12 oz bag of coffee
- Tumbler + five-drink card
- Tote + beans + mug gift set
- Holiday bundle with seasonal packaging
Bundle pricing: price at a modest discount to the sum of the parts (for example, 10%), and check that the bundle still hits your margin target. Bundles move slow items alongside fast ones.
Discounts without damaging your brand
- Loyalty perks: 10% off merch for members
- Seasonal promotions with clear end dates
- Free drink with purchase instead of price cuts
- Clearance for discontinued designs, kept separate from your main display
When to change prices
- Costs rise on your next order
- Items sell out instantly (you may be underpriced)
- Items sit for months (price, design or placement may be off)
Track sell-through by item; see our retail display guide for metrics. For specific items, see our guides to custom mugs, tumblers, tote bags and T-shirts.
Lower your landed cost
Affogato Bean produces branded mugs, tumblers, totes and apparel with design help included, and quotes at multiple quantities so you can find your best landed cost. See products or talk to us.
Frequently asked questions
How should a coffee shop price its merchandise?
Start with landed cost (product, printing, shipping and packaging), apply a target margin, compare with local and online comparables, and round to a clean price. Many cafés aim for around 50–65% gross margin on merch.
What's the difference between markup and margin?
Markup is profit as a percentage of cost; margin is profit as a percentage of the selling price. A 100% markup equals a 50% margin.
Should cafés bundle merch?
Yes. Bundles like a mug plus a bag of coffee or a tumbler plus a drink card raise average order value and move slower items, as long as each bundle still meets your margin target.