# Retail Markup



## MrMatt (Dec 21, 2011)

I've got an idea for a product and if I get a workable prototype I'll be applying for a patent.

Part of the business plan is figuring out how much to sell it for as a distributor/wholesaler. Does anyone know what the typical retail markups in specialty stores are?

I've seen similar products for $2 or $5 on wholesale websites, and the retail price of about $20. My estimate of cost was about $1.50, so I think the lower price is quite realistic.

If the manufactured cost/wholesale cost (I'll contract out manufacturing), what type of price can I expect to sell it to the stores for?


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## jcgd (Oct 30, 2011)

I don't know the answer to your question, but in your position I would ask some people who would want this item what they would pay for it. More accurately, what they think they would have to pay for it, because this would be the higher number.


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## the-royal-mail (Dec 11, 2009)

Retail markup is usually 40%. So the dealer invoice from the supplier is 60% or less of MSRP.


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## andrewf (Mar 1, 2010)

You have to think about how many you might sell. Based on what you've said, it sounds like you should be marking up to $4 or 5. Even if your marginal cost is $1.5, you need to cover fixed expenses as well.


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