Why Margin Calculation Matters
Many new retailers focus only on the wholesale price. What actually decides your profit is the gap between your landed cost and your selling price, after all expenses and returns.
Know Your Landed Cost
Landed cost is more than the wholesale rate per piece. Add transport or courier, packaging, and any taxes that apply to you.
Landed cost per piece = (Wholesale price + transport + packing) / number of pieces
Markup Vs Margin
| Term | Formula |
|---|---|
| Markup % | (Selling price - Cost) / Cost x 100 |
| Margin % | (Selling price - Cost) / Selling price x 100 |
Example with simple numbers: if cost is 100 and you sell at 200, markup is 100% but margin is 50%. Always know which one you are talking about.
Costs Beyond The Product
- Shop rent or online platform and ad cost
- Staff and electricity
- Returns, exchanges and damaged pieces
- Discounts during sales and festivals
- Unsold stock at the end of the season
Ways To Improve Your Margin
- Buy directly from the manufacturer instead of multiple middlemen.
- Reorder fast-moving designs instead of overstocking slow ones.
- Sell co-ord sets and combos to raise the average order value.
- Reduce returns with accurate size charts.
- Plan festive stock early to avoid heavy end-of-season discounts.
Plan Your Pricing With BluePeak Global
For current wholesale rates and order terms, send an enquiry on our B2B page.
