Ever since I can remember, I’ve had this ‘entrepreneurial’ attitude. When I was 9 years old, I would visit my local pottery shop and purchase a dozen un-baked coffee cups. I would then draw cartoons on them and would then bring them back to the pottery shop to have them baked.

I’d eventually take them into my local police department or church … and sell them. I did sell a few, But I never really made a profit. The price of the actual mugs, the kilning and paint all cost much more than what I made from sales. This is the same dilemma I have in the retail world. I’ve been selling my own logo design software product in retail stores such as Fry’s Electronics and Office Depot for a few years now.

The software boxes cost about $3.00 to build. This includes the box, the CD and it’s sleeve, and the burning of the CD disk. There’s also a ‘filler’ that the retailers want you to include (this makes the box appear stronger on the shelf).

To design the box’s artwork, You can find a professional graphics person. If you’re brave, and don’t have to meet face to face, you can hire a designer from a company like eLance.com (eLance allows you to choose designers who “bid” on your project). A graphic designer may charge somewhere in the neighborhood of $2,500 to $7,500 to create the artwork for the box! Something to remember: it’ll cost, in the end, about $3,000 for 1000 boxes.

1,000 units is the least amount you’ll be able to print. This can add up when a large chain like Fry’s Electronics for example has 1200 stores around the country). Each store could order a minimum of 5 software boxes. That’s 6,000 boxes! … At $3 a pop! Do the math and it’s crazy if you’re just starting out.

Once the boxes are manufactured, you have what they call “Shelf Space” to deal with.

Not all, but some retail chains won’t just take a product and put it onto their shelves. They need cash for this “shelf space” first.

Often times, this shelf space gets as high as $4,000 for just one product! You really need to sell an armload of your software in order to make up this $5000. Oh, and then, the retail chain may take a 10% cut of your sales …It can all get crazy.

Why the internet is better

This is why the internet is so terrific. NO overhead other than your time. (I use external eCommerce companies to handle my shopping cart system. They take 20% of my monthly sales. …but it’s WELL worth it I must say).

This is why downloadable software is so profitable. Create it once and sell it multiple times. An eBook or homemade CD as an example. The Retail stores used to be king, but no longer. The Web rules!

It may be a bit more difficult to market yourself online with so much more competition, but that’s where your SEO (Search Engine Optimization) and eMail campaigns come into play …but that’s a topic for another article.

Marc Sylvester, CEO of Laughingbird Software. Find out how you can create more than just logos with The Logo Creator – Logo Design Software for Mac and Windows