How Does Merchant Pricing Work for Ecommerce Stores? Print

Overview

Merchants can sell their books through Shopify, WooCommerce, or Wix, while Lulu fulfills the orders. Your revenue depends on how you price your products and shipping in your store.

Note: This article specifically applies to Shopify, WooCommerce, and Wix.

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 you sell 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.

Because Lulu Direct is a print-on-demand fulfillment service, your customers do not purchase books directly from Lulu. Instead, they purchase from your website, and you pay 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 revenue.

Understanding Lulu Direct Pricing

Every product sold through Lulu Direct has two different prices.

List Price

The list price is the price your customer sees and pays on your website.

You control this price. Whether you sell through Shopify, WooCommerce, or Wix, you decide how much to charge your customers.

This price typically includes your desired profit because the money from the retail sale is paid directly to your business, 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 when you pay Lulu.

The print cost is what you pay Lulu to manufacture and fulfill the order after your customer completes the purchase.

Setting a Retail Price

Because you control the retail price shown in your online store, you can set it based on your business needs.

However, it is important to understand how your retail price affects your 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.