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Calculate the recommended selling price based on cost and desired profit margin or markup.
Margin is % of selling price. Markup is % of cost. A 50% markup equals 33.3% margin.
Divide the cost by (1 - desired margin). For 40% margin: cost / 0.60.
Use margin for financial analysis since it relates to revenue, but use markup for quick cost-based pricing. Most retailers use markup for initial pricing then track margin for profitability.
Include shipping materials, carrier fees, and payment processor charges (typically 2.5-3.5%) in your product cost before applying margin or markup to ensure profitability.