The retail markup refers to the percentage you have to add to the retailer's purchase price to get the selling price. The markup differs from the margin because the margin refers to the percentage of the selling price that equals the profit. The larger the markup, the greater the difference between the cost of the item to the seller and the sales price. The greater the markup, the higher the profits. However, markups that are too high may cause customers to shop elsewhere.
Instructions
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1
Subtract the sales price from the retailer's cost. For example, if a retailer pays 50 cents for a tomato and sells it for 65 cents, subtract 50 cents from 65 cents to get 15 cents.
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2
Divide the result by the cost to the retailer. In this example, divide 15 cents by 50 cents to get 0.3.
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3
Multiply the result by 100 to find the retail markup as a percentage. Completing the example, multiply 0.3 by 100 to get 30 percent as the retail markup.