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Amazon Breaks the Merch Mold with On-Demand T-Shirts

Mega-disruptor Amazon has been quietly subverting the traditional merch supply chain with character and logo-emblazoned graphic tees.

Amazon’s on-demand t-shirt printing service is now in its third year of operation, serving a wide range of clients from video game manufacturers to Disney. Merch by Amazon offers designs across 21 colors and 15 sizes, the company told Reuters, and is courting brands of all kinds, from consumer products to musicians and influencers.

What appeals most to customers large and small is the made-to-order model, which eliminates the need to hold inventory. A brand like Disney, for example, can create a design featuring a lesser-known or niche figure from its cadre of characters, and not commit to ordering a high volume of stock. Instead, designs are listed for sale on the site and created after they’re ordered.

By delaying the production of products until they’re vouched for by buyers, companies can avoid sitting on piles of unsold goods, which are costly to store. It also eliminates the need to discount unsold product, which can affect perceived brand value.

Merch by Amazon highlights yet another way in which the retailer is becoming a key player in the apparel arena. Over the past several years, the company has sought patents on computer-managed processes that integrate the printing, cutting, sewing and dispatch of products, Reuters reported.

Dr. Seuss Enterprises has increased sales by 40 percent since it opened its Merch by Amazon store 18 months ago, the group’s president, Susan Brandt, told Reuters. The group’s Cat in the Hat and Grinch t-shirts and hoodies are primarily designed in-house, but Amazon deals exclusively with sales and distribution.

Merch by Amazon’s printing facilities are operated out of Philadelphia and Dallas, serving the U.S. market. A facility in Poland serves the European market.

The program’s ability to print the products in local markets on a made-to-order basis mitigates dependence on factories in China, Vietmam and Indonesia, which would demand larger scale orders and offer lengthier production and shipping time frames, Reuters reported.