Retail Markup Formulas Guide

 Here is the guide for what to multiply the cost on an item by, in order to arrive at a desired or target markup percentage.

[Multiply the Cost times the Appropriate Number Below-

Then, if Necessary,  Round the Result Up or Down To Get To

A “Pretty Number” For The Selling Price]

Multiply Cost $ of Item To Get A Retail Price Which Will Give You The Following Margins:

Cost $ X 2.0 = 50% Margin  (Ex.: Cost $50 X 2 = $100 Retail, Which is 50% Margin) Note: A 50% margin is also called "keystone" pricing.

Cost $ X 2.1 = 52.4% Margin ( Cost $50 X 2.1= $105 Retail, Which is 52.4% Margin)

Cost $ X 2.2 = 54.5% Margin (Cost $50 X 2.2 = $110 Retail)

Cost $ X 2.3 = 56.5% Margin (Cost $50 X 2.3 = $115 Retail)

Cost $ X 2.4 = 58.3% Margin (Cost $50 X 2.4 = $120 Retail)

Cost $ X 2.5 = 60% Margin    (Cost $50 X 2.5 = $125 Retail)

Cost $ X 2.6 = 61.5% Margin (Cost $50 X 2.6 = $130 Retail)

Cost $ X 2.7 = 63.0% Margin (Cost $50 X 2.7 = $135 Retail)

Cost $ X 2.8 = 64.3% Margin (Cost $50 X 2.8 = $140 Retail)

Cost $ X 2.9 = 65.5% Margin (Cost $50 X 2.9 = $145 Retail)

Cost $ X 3.0 = 66.7% Margin (Cost $50 X 3 = $150 Retail)

Fashion stores, generally, should strive for an average markup of at least 56%

(Cost X 2.3) in clothing and shoe classes. Most Accessories and Jewelry classes should be higher-

From 2.5 (60%) to 3.0 (67%) or even more, if the market will bear it. Some hardlines and Sporting Goods industry stores may have trouble getting even 50% on some classes, but markdowns are not normally such a factor due to seasonality, trendiness, broken size assortments, etc.