You will need

- calculator, pen and paper

Instruction

1

What is the margin?

Mathematically, the margin represents interest (rarely solid) premium to the purchase price of the goods. The mark-up added to the cost of purchase is forming the final price of sale. It is paid by the buyer. When a sufficient volume of sales value margin should be enough businessman not only for the payment of all related expenses, but also for profit.

Mathematically, the margin represents interest (rarely solid) premium to the purchase price of the goods. The mark-up added to the cost of purchase is forming the final price of sale. It is paid by the buyer. When a sufficient volume of sales value margin should be enough businessman not only for the payment of all related expenses, but also for profit.

2

Conduct pricing

Regardless of which prices give suppliers, our final price is due, primarily, to arrange buyers. Therefore, when conducting pricing no clearly defined factors-allowances. The margin on each product varies depending on many conditions.

In the established practices of the trade in the retail segment generally, the following surcharges apply:

• food – from 10 to 35%

• clothing and footwear – from 40 to 110%

• household goods – from 30 to 60%

• for Souvenirs, jewelry – 100% and above

• cosmetics – from 30 to 70%

• for spare parts – from 30 to 60%

In order to calculate the selling price, multiply the cost of purchase on a markup percentage. The resulting value is added to the amount of purchase. For example, a vendor brought us a plate bumper on the car to 1940 To RUB the end of the sale we set the margin at 35%.

1940 * 35% = 679

Our selling price will be 1940 + 679 = 2619 (RUB)

The margin can be calculated retroactive. For this sale price divided by the purchase price and subtract one. For example, we sell 1 kg of bananas for 45 rubles. the purchase Price was 35 RUB.

Thus, the margin is equal to 45 / 35 – 1 = 28,5 (%)

Regardless of which prices give suppliers, our final price is due, primarily, to arrange buyers. Therefore, when conducting pricing no clearly defined factors-allowances. The margin on each product varies depending on many conditions.

In the established practices of the trade in the retail segment generally, the following surcharges apply:

• food – from 10 to 35%

• clothing and footwear – from 40 to 110%

• household goods – from 30 to 60%

• for Souvenirs, jewelry – 100% and above

• cosmetics – from 30 to 70%

• for spare parts – from 30 to 60%

In order to calculate the selling price, multiply the cost of purchase on a markup percentage. The resulting value is added to the amount of purchase. For example, a vendor brought us a plate bumper on the car to 1940 To RUB the end of the sale we set the margin at 35%.

1940 * 35% = 679

Our selling price will be 1940 + 679 = 2619 (RUB)

The margin can be calculated retroactive. For this sale price divided by the purchase price and subtract one. For example, we sell 1 kg of bananas for 45 rubles. the purchase Price was 35 RUB.

Thus, the margin is equal to 45 / 35 – 1 = 28,5 (%)

3

Calculated the purchase price of the competitor

In order to calculate the purchase price of the competitor, choose the category of items to compare. Then added to the average mark for this type of product unit and divide the sales price of a competitor for that amount.

For example, we have a direct competitor, which sells shoes purchased from our supplier. We need to find out whether the provider gives him more than great prices. Pair of shoes from a competitor is 3500 RUB. We know that under the terms of the contract with the provider, the average margin on shoes can be no more than 60%. The calculated purchase price.

3500 / 1,6 = 2187,5 RUB.

Comparing thus some headings, we get a General understanding of procurement prices of a competitor. Knowing the principles of formation of the margin, to calculate this indicator on any product is easy.

I hope that now you will be able to correctly calculate the premium at any time and in any store.

In order to calculate the purchase price of the competitor, choose the category of items to compare. Then added to the average mark for this type of product unit and divide the sales price of a competitor for that amount.

For example, we have a direct competitor, which sells shoes purchased from our supplier. We need to find out whether the provider gives him more than great prices. Pair of shoes from a competitor is 3500 RUB. We know that under the terms of the contract with the provider, the average margin on shoes can be no more than 60%. The calculated purchase price.

3500 / 1,6 = 2187,5 RUB.

Comparing thus some headings, we get a General understanding of procurement prices of a competitor. Knowing the principles of formation of the margin, to calculate this indicator on any product is easy.

I hope that now you will be able to correctly calculate the premium at any time and in any store.