As a GEM-CAR customer, you have access to GEM-UNIVERSITY  with all recorded GEMINAR including the one on how calculate selling price based on a cost using a margin. You would also have access to the industry standard margin based of different categories .

  • What is the growth margin 


The gross margin is the profit calculated on the selling price of an article.


For example, for a repair shop :
  • with 1 million in sales,
  • with a $100 000 in profit,

We would all say that he as a 10% gross margin!

Margin Formula for a shop : Profit / Sales


OR

Margin Formula for a product: (Selling-Cost) / Selling



To calculate the selling price based on the cost with a margin in % ;

 

Selling price = Cost / (1-Margin) 


Ex:

If an item as a cost of $100 with a margin of 40%, we should sell it for $166.67
 
Selling = 100 / (1 - 0.4) = $166.67
 
Margin = (166.67-100) / 166.67 = 40%


At the end of the day using a margin vs a markup  makes more money in your bank account.

Ex : a part at $100 sold for $100 x 140% = $140

Margin = ($140-$100) / $140 = 29%




To calculate the selling price based on the cost with a markup ;

 

Selling price = Cost * (1  + markup)


Ex:

If an item as a cost of $100 with a markup of 40%, we should sell it for $140
 
Selling = 100 x (1 + 0.4) = $140