How Does Lulu Direct Merchant Pricing Work? Print

Overview

Merchants have the ability to sell their books through their Shopify, WooCommerce, or Wix website, and Lulu fulfills the orders. Profit margins are affected depending on how products and shipping are priced in the merchant's store.

TABLE OF CONTENTS

• Overview
• Lulu Direct Transaction Flow
• Understanding Lulu Direct Pricing
  • List Price
  • Print Cost Price
• Setting a Retail Price
• How Payment Works
  • Example Pricing Breakdown
• Things to Keep in Mind
  
  

Lulu Direct Transaction Flow

When selling books through Lulu Direct, there are two separate transactions involved in every sale:

1. The retail sale between your customer and your business.
2. The fulfillment transaction between your business and Lulu Direct.

Because Lulu Direct is a print-on-demand fulfillment service, your customers do not purchase books directly from Lulu. Instead, they purchase from the Merchant's website, and then the Merchant pays Lulu separately to print and ship each order.

Understanding the difference between these two transactions is important when setting your product prices and calculating your profit.

Understanding Lulu Direct Pricing

Every product sold through Lulu Direct has two different prices.

List Price

The List Price is the price the Merchant's customer sees and pays on the merchant's website.

The Merchant controls this price completely. Whether they are selling through Shopify, WooCommerce, or Wix, the merchant decides how much to charge their customers.

This price typically includes your desired profit, because the money from this sale is paid directly to the merchant, not to Lulu.

Print Cost Price

The Print Cost is the wholesale fulfillment price charged by Lulu Direct.

This amount typically includes:

• Printing
• Materials
• Labor
• Order fulfillment

Shipping charges and applicable taxes are calculated separately during checkout when the Merchant pays Lulu.

The Print Cost is what the merchant pays Lulu to manufacture and fulfill the order after your customer has completed their purchase.

Setting a Retail Price

Because a Merchant controls the retail price shown in their online store, they are free to set it at whatever amount best fits their business.

However, it's important to understand how the pricing affects the revenue.

If a product's retail price is:

• Higher than Lulu's Print Cost: The Merchant will earn the difference as profit less shipping and taxes.
• Equal to Lulu's Print Cost: The Merchant will not earn any revenue.
• Lower than Lulu's Print Cost: The Merchant pays Lulu the cost difference, resulting in a deficit for that order.

For this reason, we recommend carefully reviewing Lulu's Print Cost before deciding on your product's retail price.

Tip: Lulu's Pricing and Shipping Calculator is a helpful tool for estimating the print costs before listing products for sale.

Review pricing on the Lulu Pricing and Shipping Calculator.

The retail price can be set for a product from the Lulu Direct Dashboard, when creating a new product:

1. Navigate to the Lulu Direct Dashboard.

2. Click your Sales Channel to open it. 

3. On the Sales Channel Dashboard, click Add Product.

4. When provided the options, click Create a New Product.

5. On the Add a Product screen, the List Price can be set in the Store List Price field. 

Note: If a merchant is connecting an existing product from their store, the list price is set directly within the product listing in their store.

How Payment Works

One of the most common questions merchants have is where customer payments go.

The process works as follows:

1. A customer purchases a book from the Merchant's website. The customer pays for the List Price, Shipping and Taxes/VAT. That money goes to the Merchant, not Lulu.

2. The order is automatically sent to the Merchant's Lulu Direct Dashboard. The order will remain unpaid until the Merchant submits payment to Lulu, unless auto payment is active.

3. The Merchant pays Lulu separately for the order.

This payment covers:

• Print Cost
• Shipping
• Applicable Taxes
• Fulfillment Fee ($1.75)

Once payment has been received, the order enters production.

4. Lulu prints and ships the order directly to your customer.

Tracking information becomes available after the order ships.

Example Pricing Breakdown

The following example demonstrates how the pricing works.

This example is for illustration purposes only. Your actual costs will vary depending on your book's specifications, shipping destination, shipping method, and applicable taxes.

Things to Keep in Mind

• Lulu Direct is a business-to-business (B2B) fulfillment service.
• Customers purchase from your business, not from Lulu.
• Merchants determine their own retail pricing.
• Lulu charges the Merchant separately to print and fulfill each order.
• Shipping charges and taxes are calculated when the Merchant pays Lulu for the order based on the destination address.
• Setting the retail price below Lulu's Print Cost will result in little or no profit and may cause the merchant to lose money on each sale.

Understanding the relationship between your retail price and Lulu's Print Cost will help you price your products appropriately and build a sustainable print-on-demand business.