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What is Retail Margin?

Retail margin is the part of the selling price a shop keeps after paying for the goods, usually shown as a percentage of the selling price.

Updated

Meaning

English

Retail margin is the part of the selling price a shop keeps after paying for the goods, usually shown as a percentage of the selling price.

Roman Urdu

Retail margin woh hissa hai jo dukaan Sale price me se maal ki Cost nikaal kar rakhti hai, aam taur par percentage me.

Also called shop margin, profit margin.

Example

A shop buys a shirt for 1,200 rupees and sells it for 1,600. The margin is 400 rupees, which is 25 percent of the selling price.

The formula

Margin percentage = (selling price minus cost) divided by selling price. Markup uses cost as the base instead, so the same shirt has a 33 percent markup but a 25 percent margin. Use one and stay with it. Margin is before expenses such as rent, salaries and electricity; what is left after them is net profit. See gross margin and markup.

In Nafaa

Nafaa shows price, cost and margin on each product card and profit by product in reports. Try the profit margin calculator.

Related terms

  • Gross Margin

    Gross margin is gross profit shown as a percentage of the selling price: (selling price minus cost) divided by selling price.

  • Markup

    Markup is the amount added to the cost price to get the selling price, usually expressed as a percentage of cost.

See your real profit every day

Nafaa shows sale, cost, expenses and profit by day, item and branch, without a separate sheet. 7-day free trial.

Learn more

  • Free tool

    Profit Margin Calculator

    Work out profit, margin and markup from your cost and selling price, or find the price that gives the margin you want. Built for shops in Pakistan: type rupee amounts, add a quantity for total profit, and see why a 25% markup is only a 20% margin.

  • Product

    Reports

    Nafaa Reports answer the owner's questions in plain numbers: today's sale and profit on the dashboard, profit by product, profit and loss with expenses, the day book, stock value, staff and customer reports, with Excel export and journals for QuickBooks, Xero, Zoho Books or Tally.

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