RRP prices

[tina]

Hi

The manicure range which I use I wish to start retailing some if their products.
I've received their new catalogue and it shows what can be retailed but in the price list it only gives me the trade price.

Is there a formula for working out a Mark up price.

Thanks

 

[jmd1980]

I would advise you to work out how much each item costs you to buy (include, VAT, shipping etc.) and multiply by 2.5.

That is a general guideline used in retail, but you can also take into account your overheads, competitors, and the market in your area, and adjust accordingly.

James

 

[Tomme]

Hi

The manicure range which I use I wish to start retailing some if their products.
I've received their new catalogue and it shows what can be retailed but in the price list it only gives me the trade price.

Is there a formula for working out a Mark up price.

Thanks

What can be retailed? That's your choice. If I wanted I can sell tubes of tint and peroxide.

Like said take cost, vat, shipping if any into account, doube it or even triple. Depending on if it seems too high lower it or increase if needs be.

Something cheap, say a comb, example price £1 with vat (not correct price). Doubled still seems low for professionally used combs so triple to £3, seems a bit high for a comb so lower to £2.50, just right! Xoxo

 

[LAPirate]

Hi

The manicure range which I use I wish to start retailing some if their products.
I've received their new catalogue and it shows what can be retailed but in the price list it only gives me the trade price.

Is there a formula for working out a Mark up price.

Thanks

Companies are no longer able to give RRP's as this was deemed to be price fixing which I believe is no longer allowed.

 

[fozzyo]

Stationary and gift shops it works out double +vat generally.

Not aware RRP outlawed ... Requiring people follow it is different. Recommending is five ... Just as Dermalogica, Eve Taylor and s2 do.

 

[jmd1980]

There used to be a ban on RRP for certain goods but this was lifted last year.....i think!!!!!

J

 

[Tomme]

There used to be a ban on RRP for certain goods but this was lifted last year.....i think!!!!!

J

Rrp stands for recommended retail price. Recommended being the optimal word. Its not set retail price. You can alter up or down as much as you wish xoxo

 

[jmd1980]

I just checked this out as I was sure I had read it somewhere....RRPs were banned on electrical goods from 1998, until February of 2012, when this ban was lifted by the competition commission. There is our new fact for the day!!!

J

 

[Blue Rose]

Hi

The manicure range which I use I wish to start retailing some if their products.
I've received their new catalogue and it shows what can be retailed but in the price list it only gives me the trade price.

Is there a formula for working out a Mark up price.

Thanks

The retail industry is generally 2.3-2.5% of the NET price ie before VAT & p&p. Sadly, the beauty industry is generally 35-50% and maybe 100% if you're lucky with who you go with....

Your best bet though is to contact the company you've bought from & go with their suggestions

 

[jmd1980]

Yep beauty mark ups are notoriously high. One of the worst offenders is fragrance. I once read a study on many of the celebrity perfumes, all made by the big perfume houses. In some cases they cost pennies to make (literally, under a pound per bottle), and were being sold at 19.99 or whatever it was - a mark up of 4000%.

In terms of the salon, for example if you buy a cleanser for £x, I would say sell it for £x times 2.5 - multiplying your cost price by 2.5, which could also be described as a mark up of 150%.

In recent years a lot of retail is multiplying cost prices by 3 (or a mark up of 200%). The saying is, a pound for the product, a pound for your costs (overhead, tax etc), and a pound for yourself (profit).

Your suppliers will be able to give you some guidance too. Good luck with your retailing, it is a great way to increase your margins that is not labour intensive!

J

 

[MrsHBeauty]

Generally if I buy something for £2 I retail it for £4 but often I buy for £2 plus vat and still sell for £4 the products have to be affordable to our clients whilst still turning a decent profit.

If I can't sell it for double what I bought it for I am reluctant to sell it.

 

[tina]

Thanks for the suggestions, I will take all other costs into account and work out a price but like you say when I look at prices I think as to whether I would pay that or does the price sound too high for the item that it is x

 

[jmd1980]

Thanks for the suggestions, I will take all other costs into account and work out a price but like you say when I look at prices I think as to whether I would pay that or does the price sound too high for the item that it is x

Exactly!....Products (or services for that matter) are only worth what people are prepared to pay for them....

J

 

[Tomme]

Yep beauty mark ups are notoriously high. One of the worst offenders is fragrance. I once read a study on many of the celebrity perfumes, all made by the big perfume houses. In some cases they cost pennies to make (literally, under a pound per bottle), and were being sold at 19.99 or whatever it was - a mark up of 4000%.

In terms of the salon, for example if you buy a cleanser for £x, I would say sell it for £x times 2.5 - multiplying your cost price by 2.5, which could also be described as a mark up of 150%.

In recent years a lot of retail is multiplying cost prices by 3 (or a mark up of 200%). The saying is, a pound for the product, a pound for your costs (overhead, tax etc), and a pound for yourself (profit).

Your suppliers will be able to give you some guidance too. Good luck with your retailing, it is a great way to increase your margins that is not labour intensive!

J

I understand where your coming from, but saying penny's to make pounds to retal, there is extensive development for each perfume, costing time. Its a bit like our industry, if we didn't say our time and skill is worth £x most services would be next to nothing, in the cost of product use. Xoxo

 

[jmd1980]

I understand where your coming from, but saying penny's to make pounds to retal, there is extensive development for each perfume, costing time. Its a bit like our industry, if we didn't say our time and skill is worth £x most services would be next to nothing, in the cost of product use. Xoxo

I think the difference is that you have an economy of scale in retail. For example, it costs x pounds to develop a product and bring it to market. You need to sell y amount of that product to recoup your development and marketing costs. Once you have sold y amount of product and recouped your costs, everything else is profit once you take out the production margin. The more you sell, the cheaper each unit costs.

Sadly that is not true with services.....Anything we do service wise takes time, and therefore costs per hour money as we have to make a living. So the cost of our time never gets cheaper,no matter how many services we provide.

Pricing is a tricky little game!!!!

J
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