The most important thing when selling your band’s merchandise is the location of the merch booth/table and also having a trusted friends run the booth during the show. Visibility is crucial at whatever venue you are playing. Hopefully, if the venue has a designated area, it is in a well-lit and easily accessible area of the club. Ideally, you want to be set near the door or near the stage. If the venue doesn’t have a good spot, see if you can work with them, or come up with a creative idea to draw attention. Make sure you always bring a few small lamps, in case the area needs more light.
Try to create as much buzz around your merch booth as possible. It is always helpful if you can find a motivated friend that doesn’t play in the band to help out. Think outside the box in order to draw more people over. Hold raffles, give away small items for free like stickers, key chains etc. Offer deals like buy a t-shirt, get a cd, etc. Really try to push the limits on this one. There is a lot you could get away with in a club, but just to be safe, double check with the venue before you try anything too outlandish.
Lastly, fans love items that are tour or album specific. Try selling a previously unreleased track from the album your promoting, and sell it exclusively at your live shows. T-shirts with the name of the city and venue on the back are great because people love to prove they were actually there (but as mentioned don’t over order these). It’s a bit tacky to sell your set list, but coupling your set list with a purchase is appealing to consumers.
A lot of these tips can be applied to selling merch online as well, just make sure your music contacts are heavily promoting the fact that you sell online too. The most important thing to remember with this is to be sure to punctual in sending out orders. No one likes to wait, and if you don’t send the item promptly, you may lose a fan.