Margin vs markup
Margin is profit as a share of the selling price. Markup is profit as a share of the cost. A 50% markup is only a 33% margin — mixing them up is the most common pricing mistake in retail.
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Result
£19.08
gross profit per unit
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Understand it
Margin is profit as a share of the selling price. Markup is profit as a share of the cost. A 50% markup is only a 33% margin — mixing them up is the most common pricing mistake in retail.
Payment processing, packaging, returns and ad spend all come out of the same gross profit. A product that looks profitable at 40% margin can lose money at a 3x ROAS.
FAQ
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