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Help:Typical Retail Margin Percentage?
8 posts
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Help! I'm new and I would like an idea of what kind of prices Retailers (Walgreens/Walmart/Target) get items at/or rather what type of Retail Margin they would like. If anyone could be of help that would be great! Thank you so much for just reading the thread! Have a nice day!
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It truely depends on the product. I've sold items I've gotten for 25 cents for $27 without a problem. I have my "money trees" planted all over. Meaning I sell in many different types of venues... online and off. I have found it's also about "preceived value". This depends where and what your selling at the time. I don't think there is a certain percentage you can really pinpoint. You have to play around with the price to see what it will go for.
Example being... In the winter...I buy remote car starters from Walmart for $45. I charge customers $150 for equipment and installation. The local stores charge $250 and up. I save the customer $100 and I come to them. So... I install it while they enjoy the conforts of their own house. It takes me maybe an hour at the most to install one. Awesome money maker in the winter... beats shoveling snow! -
Pendants4u has got it right -- margins can be all over the place, depending on product, seasonality, venue, etc, etc.
But if you're looking for just the simplest, crudest, most average benchmark, a retail gross margin of 50% is a good rule of thumb to use. Buy something for $5, sell it for $10.
Matt -
Actually, even with the 50% plan you need to include shipping costs. Should be
Buy it for $ 5.00, plus 15% shipping ( 75 cents ) = 5.75. Sell it for $ 11.49 to $ 11.99. -
I am no mathematical genius but if you buy something for $5 and sell it for $10 isn't that 100%? Just curious.
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No, buy for $5 and sell for $10 is 50% gross margin.
GM = (sales minus cost of goods sold)/sales
GM = ($10 - $5)/$10 = 50%
People often use the term "markup" to mean that 100%. The two terms are commonly confused, and used interchangeably when they shouldn't be.
Matt
PS: "Margin" is normally short for gross margin. -
Hi Guys,
While we are on this topic, can you tell me what is the average mark up for distributor. My products are skin care products.
If you know the typical mark up for retailer of skin care, that would be great.
Thanks in advance, really appreciate your help!
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Prncess wrote:Help! I'm new and I would like an idea of what kind of prices Retailers (Walgreens/Walmart/Target) get items at/or rather what type of Retail Margin they would like. If anyone could be of help that would be great! Thank you so much for just reading the thread! Have a nice day!
From what I understand, large chains like Walmart and such do not work on these kind of margins. Speaking in terms of markup, they mark up most items an average of 30%-40% and even lower. The margin (as you can imagine) is very small.
I talked to the buyer of a fairly large surplus outlet chain in the NE. He told me that they work on 50% markup.
If you want to know the average retail markup within a certain industry, it is best to join a trade association that deals with your product. Trade associations offer this kind of info.
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