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Mon 3 Jan, 2005 10:49 pm
How does a distributor calculate their markup percentage on a product given the following:
Their cost = $65
Their retail = $109
Is it one of the following formulas? If not, what do these formulas tell?
$65 / $109 = 59.63% ?
$109 - $65 / $109 = 40.37% ?
$109 - $65 / $55 = 80% ?
I think the markup would be expressed as: C * x = R, or x = R/C
Where x is the markup.
In your example, $109/$65 = 168%
But I'm no expert.
The top-line profit, or "Markup", is the difference between the sale price and the acquisition cost. In this instance, $109 - $65 = $44; 44/65 = .67692 etc - call it 67.7%, so; $65 + ($65 x .677) = $109
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