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What is the formula to figure the profit margin on wholesale cost to store? Cost $1.00 sold to store $3.00

What is the most common formula used to figure the profit margin when a $1.00 wholesale item is sold to a store for $3.00? Would the profit margin be 50%, 100% or 200%?

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Answers (2)
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Hernando County, FL

PROFIT= 200%
PROFIT MARGIN=66.6% (see previous answer). This is also called a ROS (Return on sales) or if you really want to get tricky you can call it Profitability.
After you figure the PROFIT MARGIN, then you can figure how many months it took to sale and divide that number in to 12 , to give you ANNUAL PROFITABILITY. You really only need this if you are doing a business expectation

Mar 16, 2010
Kevin Blank
Premium Broker

Profit Margin = (Markup/Retail Price) *100 so in your example your markup would be $2 and the retail price is $3 so it would be (2/3)*100 = 66.7%

Hope that helps.

Mar 16, 2010