Calculator · Retail margin
Calculate retail margin: calculator with formula and markup
Enter the purchase price and selling price, or set the retail margin or the markup. You see retail margin and markup in euros and percent, and what's left of it after OTTO commission, shipping and returns.
| Selling price excluding VAT | 50.00 € |
| Retail margin in euros | 30.00 € |
| Markup | 150% |
And what's left of it on OTTO?
| Retail margin in euros | 30.00 € |
| Commission | −8.93 € |
| Your shipping | −4.90 € |
| Return costs per sale | −1.20 € |
| Left after OTTO | 14.97 € |
| Remainder of the selling price excluding VAT | 29.9% |
Retail margin and markup are calculated excluding VAT, while OTTO calculates the OTTO commission on the price including VAT. Excludes ads and the OTTO base fee.
What you really keep after OTTO commission, ads and returns, for every item, every night, with your real OTTO numbers. That's MargenOptimierer. MargenOptimierer costs from 49 € net per month. You can test the first 14 days for free, no credit card needed.
Calculating retail margin: the formula
Retail margin is the difference between selling price and purchase price, both excluding VAT. As a percentage, you calculate it on the selling price.
Retail margin=selling price−purchase price
Retail margin in %=retail margin÷selling price
Markup is the same amount, calculated on the purchase price. It takes you from the purchase price to the selling price. The two percentages can be converted into each other.
Markup in %=retail margin÷purchase price
Selling price=purchase price×(1+markup)
Markup=retail margin in %÷(1−retail margin in %)
That's why the markup is always larger than the margin. A 100% markup is a 50% retail margin. Mix up the two and your calculation comes out too tight.
Example: a cushion at 59.50 €
Say you buy a cushion for 20.00 € and sell it for 59.50 € including VAT, with the values the calculator shows when it opens.
| Selling price including VAT | 59.50 € |
| VAT | −9.50 € |
| Selling price excluding VAT | 50.00 € |
| Purchase price | −20.00 € |
| Retail margin | 30.00 € |
Retail margin in %=30.00 €÷50.00 €=60%
Markup=30.00 €÷20.00 €=150%
| Retail margin | 30.00 € |
| OTTO commission (15% of the price including VAT) | −8.93 € |
| Shipping | −4.90 € |
| Return costs per sale | −1.20 € |
| Left after OTTO | 14.97 € |
Remainder in %=14.97 €÷50.00 €=29.9%
What's left of the retail margin on OTTO
On OTTO, the OTTO commission comes off the retail margin first. Depending on the commission group it's between 7% and 22%, and it's calculated on the price including VAT, not the price excluding it. At 15% commission and 19% VAT, that's almost 18% of your price excluding VAT.
Then come your shipping and returns, because on OTTO returning an item is free for the customer. A retail margin that's enough in a physical store is therefore often not enough on OTTO. Budget for ads and the OTTO base fee of 99.90 € per month on top.
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