What elements are included in the trade margin?
These components depend on the nature of the company's activities and the structure of its expenses and income, but the main parts of the markup include distribution costs associated with the sale of the product, tax payments, and planned profit.
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Are there average trade margins?
There are no strict boundaries here, and we can only talk about market benchmarks that have developed naturally. The average indicators for product categories look like this:
Clothes and footwear – 40-105%.
Jewelry, souvenirs – 100-250%.
Auto parts and accessories for cars – 30-55%.
Household goods, household goods – 25-65%.
Cosmetics, perfumes – 25-75%.
However, these are only general trends, and in practice it is advisable to study a specific market to find the optimal size of the trade margin.
In general, in commercial activities, it is the trade margin that ensures the seller’s profit, and its determination should be approached in a balanced manner, finding a balance between your interests and the demands of consumers.
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