Retail Price & Profit Margin Calculator
Set your selling price from your unit cost and target margin — and see your profit per piece and across the order.
What is profit margin in apparel retail?
Profit margin is the share of your selling price that is profit after costs. In fashion retail it is driven by the gap between your unit cost (what you pay to make and handle the garment) and your retail price (what the customer pays). The bigger the gap, the healthier your margin.
The Retail Price & Profit Margin Calculator above lets you set a price from your cost and a target margin — or work backwards from a price — and see your profit per piece and across the whole order.
How the margin calculator works
Enter your costs and choose how to price:
- Cost per piece — your FOB or landed cost.
- Extra cost per piece — fulfilment, returns, and marketing.
- Pricing method — target gross margin %, markup on cost %, or a fixed retail price.
- Order quantity — for revenue and profit totals.
A worked example
With a $4.50 unit cost plus $1.50 of extra costs, your total cost is $6.00. To hit a 60% gross margin, the retail price is $6.00 ÷ (1 − 0.60) = $15.00, giving $9.00 profit per piece — a 150% markup. On 1,000 pieces that is $15,000 revenue and $9,000 profit.
Why margin and sourcing go together
The single fastest way to improve your margin is to lower your unit cost. Because gross margin is calculated against the selling price, every dollar shaved off the factory cost flows almost entirely to profit. That is why sourcing factory-direct — instead of through agents — has such a large effect on the bottom line.
Margin vs. markup — what’s the difference?
- Markup is profit as a percentage of cost. A $6 cost sold at $15 is a 150% markup.
- Gross margin is profit as a percentage of the selling price. The same example is a 60% margin.
- Markup is always the larger number; confusing the two is a common pricing mistake.
Frequently Asked Questions
What is a good profit margin for a clothing brand?
Many apparel brands target a gross margin of 50–70% to cover marketing, overheads, and discounts while staying profitable. Your ideal figure depends on your channel and price point.
What is the difference between margin and markup?
Margin is profit as a percentage of the selling price; markup is profit as a percentage of cost. A garment costing $6 and selling for $15 has a 60% margin but a 150% markup.
How do I calculate a retail price from a target margin?
Divide your total cost by (1 minus the margin as a decimal). For a $6 cost and a 60% target margin: $6 ÷ 0.40 = $15.
How does a lower factory cost affect my margin?
Strongly. Because margin is measured against the selling price, reducing your unit cost lifts profit almost dollar-for-dollar. Factory-direct sourcing is the most reliable way to do this.
Should I include shipping and fees in the cost?
Yes — use the extra-cost field for fulfilment, returns, and marketing so your margin reflects real net profit, not just the factory price.