Understanding minimum order quantities and price breaks for branded merchandise
Let’s be frank, we all know what minimum order quantities are – it is what it says on the tin after all (the smallest number of items a supplier will produce or sell per order, just in case!).
But this post isn’t to teach the seasoned marketing managers to suck eggs; it’s to help junior and incoming marketing execs (who we work with a lot) to understand the wider impact of minimum order quantities (MOQs) and price breaks.
And who knows, there may be a golden nugget of advice in there for experienced marketeers too!
In reality, MOQs can affect your overall campaign strategy and whether or not you achieve maximum value from your budget, so it’s important to get your head around set up costs, MOQs and price breaks.
How MOQs affect unit pricing
The relationship between MOQs and unit price is straightforward: the larger the order, the lower the cost per unit.
However, it is a little bit more in-depth than just that.
Firstly, you have the product price itself. This is termed as a ‘plain stock’ price. You then have the cost per unit, based on the product and the branding required.
Based on the branding required, the set-up costs (also referred to as origination) and the quantity required this can vary greatly.
There are many variations to consider. For instance, a 3-spot colour print (that utilises pantones) will generally speaking have three set-up fees associated with it. If pantone matching isn’t required, then a digital print might be more cost-effective.
On ‘low cost’ items, if you are only looking to order a small quantity, you may find the branding is more expensive than the actual item. This is when larger volume orders are most effective.
In the same way, high value products may not have such noticeable price breaks as you increase the quantity, due to the branding element of the unit price only being a minimal element of the overall unit cost.
Common MOQ thresholds
MOQs vary depending on the type of product and the branding method used. Here are some typical examples:
- Low MOQ Products
- Embroidered garments – Unlike screen printing, embroidery has a single set-up cost, and isn’t heavily affected by quantity, making it a great option for lower quantity garment branding.
- Items customised with digital print – Again, digital print offers a single set-up cost, making it more effective on smaller quantities.
- High MOQ Products
- Edge to edge prints – For instance a tote bag, that has an edge-to-edge design. In order to print and edge-to-edge design, the material needs to be put together prior to the bag being made. This makes it much more cost effective on larger quantities.
- Screen printed t-shirts – If you’re looking for screen printed t-shirts, with multiple screen set-ups, it is far more cost effective the higher the quantity.
Bulk orders vs. specialist one-offs
For promotional products that you plan to distribute widely – such as at trade shows or branded uniforms for an entire team – bulk orders are often the most cost-effective choice.
- Examples:
- Branded pens, tote bags, and water bottles are perfect for large-scale distribution.
- Screen printed T-shirts for event giveaways.
- Benefits:
- Lower unit cost.
- Ability to stockpile items for future use.
If your merchandise is tied to a specific campaign, a niche audience, or requires personalisation, smaller quantities may be more appropriate.
- Examples:
- DTG-printed T-shirts with individual names or designs for a one-off event.
- Embroidered jackets for a small team or exclusive giveaway.
- Digitally printed, medium to high value merchandise.
- Benefits:
- Reduced waste for one-off campaigns.
- Flexibility to test new ideas without committing to large orders.
Balancing quantity and quality
When determining how much to order, consider the following:
- Reach: Are you distributing widely, or is it for a specific group or event?
- Impact: Are you happy with a cheap and cheerful item or do you require a premium product?
- Shelf life: How evergreen is the product? Will it remain relevant for future use, or is it lacking longevity?
- Storage: Do you have space to store excess inventory if it’s suitable for use in a future campaign?
- Budget: Is a higher upfront cost of a bulk order cost-effective or will excess items go to waste?
Understanding minimum order quantities of different branded merchandise and applications is key to planning a successful marketing campaign.
It can be invaluable to discuss your upcoming plans with your account manager, who will then be able to match you with the right products at the right price.
It is worth bearing in mind, that different suppliers work on different MOQs. For instance, if you a looking for a low order quantity of water bottles, we’ll easily be able to tell you the best options available, without you having to spend hours trawling through websites and catalogues to find what you’re looking for.
Smaller orders allow you to test the market and product, enabling you to ‘change up’ your merchandise offering regularly, but set-up fees can be expensive.
By balancing your objectives, target audience, and budget, you can make informed decisions that maximise impact without overspending.
It’s tricker than it sounds, but if you know what you are trying to achieve, we can come up with a solution that works!
