What is your markup?

st8ic

I sell flooring and 30% of each carton I sell is my profit. Is this appropriate? For those of you in retail, would you mind sharing your margins? Thanks!

StartUpSmart

Hi,
 
I`m not sure if you do installs as well but I just had a meeting with a very successful floor guy in Denver. He was telling me that in the past few months his potential clients started getting 5 and 6 bids for the work. They used to get 2 or 3 three. Consumers are on high alert (I`m sure you don`t need me to tell you that)! At any rate Janie is right, you could potentially raise your prices but you better have a clear value proposition that can be easily explained to your customer.
 
Good luck!

nevadascul

Markups vary greatly, from the "I`ll make a reasonable profit" to "I`m just plain gouging my customers."  I worked for a parts supplier once for example that sold heavy equipment parts.  Their markup was 200%.  this markup rate was set 35 years earlier when they first opened for business. At that time, they had no competition.  Since then, 40 other companies opened in the region that sold the same type of products and services.  Their markups were in the 40% to 50% range.  Needles to say, our company could not compete. 
Lesson here is that markup is affected not only profit margins that need to be met, but by competition.

robertj

I much prefer to set prices according to the market rather than the cost. Once you establish the market price for your product/service - your cost can be used to determine if the business can make a profit.

infinique1

I think you should be making sure you have at least 60-100% mark up. If not, you have got no margin for marketing promotions and discounts. Last but not least, you need to factor in wastages and damages/discrepanices to some stock.