Step one in promoting t-shirts imprinted with pop-culture gadgets is acquiring permission from rights holders. Kevin Stecko has been doing that since 2000 when he launched 80sTees.com, his t-shirt enterprise. However receiving that permission isn’t straightforward.
He informed me, “I began the corporate with designs of He-Man, a toy cartoon. I obtained that license, after which they wouldn’t approve hardly any of my designs.”
Quick ahead to 2023, and 80sTees.com carries 120,000 SKUs with photos from films, tv exhibits, comedian books, and extra. He and I just lately mentioned his journey — licensing, warehousing, drop-shipping, and extra.
The audio of our total dialog is embedded beneath. The transcript is edited for size and readability.
Eric Bandholz: Inform us about your organization.
Kevin Stecko: It’s 80sTees.com. I began the enterprise in 2000. We promote t-shirts with footage of cartoons, toys, and video video games. I’m sporting my Karate Child shirt at present.
We’ve to acquire licenses from the creator to make use of a lot of these photos. Early on I had to purchase from the producers that owned the rights. A few of them would hold inventory, and I might purchase three of a measurement. Some wouldn’t hold inventory, and I had to purchase a whole print run.
My warehouse had at the very least one among every little thing we offered. I bought the house, 45,000 sq. toes. As quickly as I purchased the constructing, Amazon sellers began consuming away at our enterprise. We by no means wanted the complete house. Now virtually every little thing’s printed on demand and drop-shipped. For essentially the most half, so long as there’s no licensing subject, I ship the orders to our suppliers electronically, they usually ship them to our prospects.
There are roughly 10 corporations that ship orders for us. They’ll license to us and print on-demand, and we listing it on our web site.
Bandholz: How do you discover the rights holders and negotiate the charges?
Stecko: There are a few methods to search out them. I typically begin by going to the web site and sending an e mail asking who I discuss to about licensing. There’s an enormous commerce present in Las Vegas known as Licensing Expo that’s useful.
If you happen to’re keen to spend $3 million, Disney will most likely discuss to you for a license — whether or not it’s basic Disney, Star Wars, or Marvel, they’re all going to value a ton of cash licensing-wise.
Hasbro isn’t as grasping. I’ve a take care of that firm for Transformers and G.I. Joe.
The massive corporations have related authorized agreements. Some will need the standard 10% royalty for t-shirts. Some will need extra, nevertheless it’s normally between 10% and 12%. In the usual approval course of, we generate a mock-up of the design after which ship it to them. If that will get accredited, the subsequent step is a manufacturing pattern. As soon as they approve the pattern, we are able to go dwell with it.
Bandholz: How do they know what number of gross sales you have got?
Stecko: It’s basically a belief factor. Within the settlement, I might comply with an audit. If my numbers are mistaken, I must pay for the audit and for errors or under-reporting. It normally doesn’t matter to us as a result of we’ve assured such a lot of gross sales. I might pay a royalty provided that gross sales exceed that quantity.
For accounting to the rights holder, we’ll obtain a quarterly report of our gross sales for that merchandise. It exhibits what we offered the product for and what number of. Then we ship them these stories and pay the royalty if relevant.
Shopping for a license is all the time a threat. We by no means know what is going to promote or whether or not the license holder will approve our designs. I’ve signed offers the place we couldn’t get something accredited.
I began the corporate with designs of He-Man, a toy cartoon. I obtained that license, after which they wouldn’t approve hardly any of my designs. We might make a design and ship it to them for his or her approval. They almost all the time responded, “Nope, can’t do this.” So we let that deal expire. I’m fairly positive we misplaced cash on it as a result of we had so little merchandise to promote.
Bandholz: What number of SKUs are in your web site?
Stecko: We’ve over 10,000 designs. Each design has from 5 to 12 sizes. So 120,000 SKUs. The navigation for our web site is exclusive. It’s arrange for looking. We’ve an enormous menu bar that expands into an accordion-style menu. We wish guests to see all our stuff, not only one merchandise.
Bandholz: You promote on Fb.
Stecko: Earlier than the pandemic, we spent lower than $100 per day on Fb. When the stimulus checks went out, we noticed how effectively the Fb Adverts had been doing, so we stored growing the finances to the purpose the place it was our greatest month ever in Might 2020.
Some days, even now, the advertisements will suck, or we don’t get the variety of conversions because the prior week. However total, nothing comes near Fb. We now spend upwards of $500 per day.
Bandholz: You’re semi-retired now.
Stecko: Right. I don’t have a pet challenge. I assist my workers, and my spouse and I are sometimes free throughout the day, and we go on a hike or exit to lunch. I labored exhausting for a really very long time, so I don’t thoughts the downtime.
Bandholz: The place can individuals assist you?