OneTaskBy Tim King · Updated
Wholesale Price Calculator
Keystone Pricing and Recommended Retail Price From Your Cost and Margin
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How the Wholesale Price Calculator works
This wholesale price calculator works forward from what a product costs you to make. Enter your target margin to set the wholesale price, then the margin a retailer expects to get the recommended retail price, along with the profit each of you makes on a unit.
Wholesale price calculator formula
Wholesale price = cost ÷ (1 − your margin) Retail price = wholesale price ÷ (1 − retailer margin)
Margins are a share of the selling price, so a 50% margin doubles the cost. Doubling at both steps is known as keystone pricing, and gives a retail price of four times cost.
Worked example: keystone pricing
A product costs 10 to make. A 50% margin sets the wholesale price at 20, a markup of 100.0% and a profit of 10 a unit. A retailer taking 50% sells it for 40, making 20 a unit. Retail is 4.00 times cost.
Worked example: a higher retail margin
A product costs 6. A 40% margin sets wholesale at 10, with 4 profit and a 66.7% markup. A boutique wanting 60% sells it for 25, making 15 a unit, so retail is 4.17 times cost.
Wholesale price reference table
The price that gives each margin on a cost of 10, and the markup it represents.
| Margin | Markup on cost | Price for a cost of 10 |
|---|---|---|
| 0% | 0.0% | 10.00 |
| 5% | 5.3% | 10.53 |
| 10% | 11.1% | 11.11 |
| 15% | 17.6% | 11.76 |
| 20% | 25.0% | 12.50 |
| 25% | 33.3% | 13.33 |
| 30% | 42.9% | 14.29 |
| 35% | 53.8% | 15.38 |
| 40% | 66.7% | 16.67 |
| 45% | 81.8% | 18.18 |
| 50% | 100.0% | 20.00 |
| 55% | 122.2% | 22.22 |
| 60% | 150.0% | 25.00 |
| 65% | 185.7% | 28.57 |
| 70% | 233.3% | 33.33 |
| 75% | 300.0% | 40.00 |
| 80% | 400.0% | 50.00 |
| 85% | 566.7% | 66.67 |
| 90% | 900.0% | 100.00 |
| 95% | 1,900.0% | 200.00 |
Quick answers
- A 50% margin means selling at twice cost.
- Keystone pricing puts retail at four times the cost to make.
- A 40% margin is a 66.7% markup on cost.
- Wholesale is usually about half the retail price.
- Margin can never reach 100%; markup has no ceiling.
- Divide retail by cost to see how many times cost the shelf price is: 40 on 10 is 4 times.
FAQ
What margin do retailers expect?
It varies by category. Many gift, fashion and homeware shops expect around 50%, while groceries and electronics run far lower. Ask stockists before fixing your price list.
What is the difference between margin and markup?
Margin is profit as a share of the selling price. Markup is profit as a share of cost. A product bought for 10 and sold for 20 has a 50% margin and a 100% markup.
Should the retail price be the same everywhere?
A recommended retail price keeps your own shop and your stockists from undercutting each other. If you sell direct, pricing at the same level protects the retailers who carry you.
See also: all Profit & Growth tools, Rates & Pricing, Invoicing & Payments.
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