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    1. kieth is offline

      Join Date
      Jun 2010
      United States
      United States
      22 Times in 5 Posts

      What markup should I add to the products I sell?

      I'd like to get some information about markups. Specifically, what is the average percentage of a markup, or is there any? For instance, if I'm selling flashlights and I mark them up 10%, how much should I markup the batteries for?
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    2. WholesaleForum's Avatar
      WholesaleForum is offline

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      Sep 2009
      United States
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      772 Times in 307 Posts
      Mark-ups are not just subjective to you as a reseller, they are also dependent on factors outside of your control:

      Subjective considerations:

      1. How little profit are you willing to make?

      2. What type of buyers do you have access to? If you sell on eBay, you are limiting yourself to bargain hunters, which limits the mark-ups you can apply.

      External considerations:

      1. Are the buyers you have access to price sensitive? Will they run to another seller just because he has a lower price than yours? Or do your buyers distinguish sellers based on other factors, like perceived quality, service, accessibility, speed of delivery, expertise, etc

      2. What type of mark-up can your target market bear? You should always try to push for the highest possible mark-up, which means you should look for buyers that are capable of bearing higher mark-ups (NOTE: there are often extra costs associated with reaching buyers that are willing to pay a higher mark up, for example a shop in a rich area, a longer conversion period, higher costs in the form of more experienced staff, etc). For example, if you are able to reach wealthy individuals who value expertise and service above price, than your mark-ups can be higher than if you are just targeting buyers who are looking for the cheapest price.

      3. How much does it cost you to reach your target buyers? Your mark-ups must reflect your advertising costs, management costs, other costs, taxes, and your profit. You need to mark-up your prices high enough to cover these expenses and your return. If your market cannot bear the mark-up then you either need to look for a different market, or look at decreasing the elements which make up your final price (cost of goods + costs of marketing + other costs + taxes + profit).
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