Markup on Sports Goods

  • Thread starter GermanInvest
  • Start date
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GermanInvest

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Hi all,

I'm not sure if theres a definite answer to this but here goes anyway!

I'm a sole trader with a website selling Sports goods, i handle all the Sales myself. However i want to branch out and try to start selling my products to sports shops. I've noticed other companies that run their own site and also sell in shops and the price is the same no matter where you buy.

So what i need to know is what price can i charge shops for my Product, in order for the shop to still make their desired profit margin and get a healthy profit for myself?

A simplified example would be: I sell product A on my site for €100. How much of a discount should i give the shop? Is 5%,10%,15%,20% etc the norm? i.e Sell it to them for €80, rrp is €100, they make €20.

Sorry if i've confused you all, but i'm new to this side of the business.
Thanks.
 
A few questions that spring to mind:

What is your usual mark-up now?
How much of the cost will the sports shop take out of your cost base?
What is your projected increase in turn over be if you also sell through sports shops?
How much of a volume discount will you get from your supplier(s) with the increased volume? (Thus increasing the margin on your existing internet sales).
How much will your costs increase by if your projected sales increase materialise?
 
Hi Purple,

Thanks for the reply, they are questions i hadn't really thought about.

My costs will decrease by selling through Shops as i would have just 1 delivery to make per shop.

I suppose i need to sit down and try to calc my projected increase in turnover. I'll also need to discuss a volume discount with my supplier.

In your experience is there a minimum % margin that shops make?
 
GermanInvest said:
Hi Purple,
In your experience is there a minimum % margin that shops make?
Click to expand...
I have no idea, as I am not in retail, but do remember that they have all sorts of fixed costs that you don't have and all of these have to be covered by the selling price. Rent and wages are the big ones but on top of that they have public liability insurance, utilities, maintenance etc. so basically the difference between your selling price and theirs does not equate to their margin.
 
GermanInvest said:
Hi all,

I'm not sure if theres a definite answer to this but here goes anyway!

I'm a sole trader with a website selling Sports goods, i handle all the Sales myself. However i want to branch out and try to start selling my products to sports shops. I've noticed other companies that run their own site and also sell in shops and the price is the same no matter where you buy.

So what i need to know is what price can i charge shops for my Product, in order for the shop to still make their desired profit margin and get a healthy profit for myself?

A simplified example would be: I sell product A on my site for €100. How much of a discount should i give the shop? Is 5%,10%,15%,20% etc the norm? i.e Sell it to them for €80, rrp is €100, they make €20.

Sorry if i've confused you all, but i'm new to this side of the business.
Thanks.
Click to expand...

It depends on the type of goods...I'd imagine they'd be looking for 50%
 
ClubMan said:
You don't know what your current markup is!? :confused:
Click to expand...

ClubMan of course i know my current markup, just cause i didn't disclose it here doesn't mean i don't know. Give me some credit!!
 
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