| Volume | Tier discount | Price/unit | Revenue | Profit |
|---|---|---|---|---|
| 1 | 0% | $140.00 | $140.00 | $40.00 |
| 10 | 5% | $133.00 | $1,330.00 | $330.00 |
| 50 | 10% | $126.00 | $6,300.00 | $1,300.00 |
| 100 | 15% | $119.00 | $11,900.00 | $1,900.00 |
| 500 | 20% | $112.00 | $56,000.00 | $6,000.00 |
| 1000 | 25% | $105.00 | $105,000.00 | $5,000.00 |
Markup is profit as a % of cost. Margin is profit as a % of selling price. A 50% markup is only a 33.3% margin — confusing them is the #1 reason small businesses under-price.
Conversion: margin = markup / (1 + markup). Want a 40% margin? Mark up your cost by ~66.7%.
Use the target-margin solver to back-calculate the cost ceiling you can pay a supplier and still hit your margin goal.
Markup is profit as a % of cost. Margin is profit as a % of selling price. A 50% markup is only a 33.3% margin — confusing them is the #1 reason small businesses under-price.
Conversion: margin = markup / (1 + markup). Want a 40% margin? Mark up your cost by ~66.7%.
Use the target-margin solver to back-calculate the cost ceiling you can pay a supplier and still hit your margin goal.
| Volume | Tier discount | Price/unit | Revenue | Profit |
|---|---|---|---|---|
| 1 | 0% | $140.00 | $140.00 | $40.00 |
| 10 | 5% | $133.00 | $1,330.00 | $330.00 |
| 50 | 10% | $126.00 | $6,300.00 | $1,300.00 |
| 100 | 15% | $119.00 | $11,900.00 | $1,900.00 |
| 500 | 20% | $112.00 | $56,000.00 | $6,000.00 |
| 1000 | 25% | $105.00 | $105,000.00 | $5,000.00 |