Posts tagged: investment

Apr 16 2012

Cafepress Goes Public – Buyers Beware!

Thinking of investing in Cafepress? For those of you unfamiliar, let me tell you something about the way this print-on-demand company does business.

I started designing there in 2004 and built up a very nice, livable income that allowed me to quit my job and work from home doing what I’d always wanted to do: t-shirt design. The way it worked was very simple. Designers could upload original artwork, have it appear on products like t-shirts and buttons, and then set their own prices over Cafepress’s base price which, they claimed at the time, allowed a nice profit for both Cafepress and the designer, not counting the $6.95 they charged designers for each premium store they opened.

In 2009 however, after years of dealing with a company that had its head up its rear when it came to website development or making intelligent business decisions, they screwed over 6.5 million designers by implementing a flat 10% commission rate on all product sales that came through their marketplace, which is where 99% of most sales came from. This greedy, thoughtless, contemptuous action resulted in the destruction of income for millions of people who, like myself, had made this a full time job. As an example, I was averaging about $2000 a month before the change. Now I bring in about $200, and that’s before they charge me their shop fees.

Since then Cafepress has devised many other underhanded ways to squeeze every penny possible from shopkeepers to the point where it’s virtually impossible for anyone but the most savvy to make a livable income there. In fact, most shopkeepers jumped ship in 2009 and went over to another print-on-demand company called Zazzle, which is where I do all my designing now as well. Sadly, this company also seems to have its head up its behind, but perhaps not as deeply. And ironically, Zazzle started out with a 10% marketplace commission rate but eventually abandoned it when they realized that designers like to make money too.

So for anyone considering investing in Cafepress now that they’ve gone public, which is apparently the reason they sought to grab as much money from designers as possible so their books would look real pretty, I’d say don’t. The management of this company has demonstrated, and continues to demonstrate, a complete lack of ethical behavior or business sense that anyone will see if they search around the internet for comments on Cafepress and the way they treat the people who made them successful.

I personally discovered Cafepress years ago and thought I’d found the gates of heaven, but it turned out to be an illusion. They offered a platform for setting up my own business and I accepted it, and after I’d discovered success and was starting to change my life, they stabbed me and six million other people in the back. Anyone thinking of investing in this shady company is hereby warned that they’re about to hand their money over to a band of greedy, drunken pirates who place little value on anything but the dollar sign.

I believe the day will come when someone’s going to “get” how one of these print-on-demand companies should be run. And when that company arrives, it will have the same printing capabilities and the same customizable products as the other guys but will differentiate itself from the competition with an intelligently designed, ethical business plan that would allow designers to make a decent income while also providing a simple yet powerful and intuitive interface that will make designing and shopping as easy and efficient as it should be. When this company arrives, whoever starts it and wherever it might be, you will again see a major exodus from Cafepress and probably from Zazzle as well. So again, buyer beware. If you want to invest your money in a print-on-demand company, find one with enough business sense to know that you don’t trample on your designers (aka customers) in pursuit of profits without any ethical consideration for the option of doing otherwise.

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