Retailer Margin Calculator
See the math from your retail buyer's side: gross margin, GMROI, and planned vs realized margin after markdowns and shrink. Understand how your wholesale pricing affects their business case.
Margin at different wholesale prices (-15% to +15%)
| WS price | IMU | Realized GM | GMROI |
|---|---|---|---|
| $23.80 | 59.0% | 51.8% | 2.15 |
| $25.20 | 56.6% | 48.9% | 1.92 |
| $28.00 | 51.7% | 43.2% | 1.52 |
| $30.80 | 46.9% | 37.6% | 1.20 |
| $32.20 | 44.5% | 34.7% | 1.06 |
How the retailer's margin is calculated
- Initial markup: (retail price minus wholesale cost) divided by retail price.
- Shrink first: shrink units come off the buy before anything sells.
- Full price, then markdown: the full-price sell-through applies to sellable units; the markdown sell-through applies to what is left, at retail times (1 minus markdown).
- Realized margin: total revenue minus the full wholesale cost of the buy, divided by total revenue. Unsold units still carry their cost.
- GMROI: gross margin dollars divided by average inventory at cost, taken as half the buy.
A buyer looks at realized margin and GMROI, not just markup. If your wholesale price leaves the retailer below about 2.0x GMROI, expect smaller reorders or a push for better terms.
Keep going
Wholesale Price Builder
Set the right wholesale price for every channel you operate: direct, Faire, key accounts, sales rep and international. The floor price auto-computes the minimum wholesale price that hits your target margin across all active channels.
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The tools are free. QVINTA does the work.
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