Profit is the most important part of your firm. But.. most leave money on the table.
Traditionally, designers calculated their markups by taking THEIR cost, and multiplying it by .3 for 30%. What this gives you using $1000 as an example, is $300. Makes sense, right? But with margin you get a profit of $428.57 which is $128.57 *more* profit from the traditional way.
How To Use:
In the cost area, add what your cost is as a designer. What is your vendor charging you for that piece?
Next, we want to (optional) add MSRP. Or, in some cases IMAP. When you add this, it will share at the calculation what the % discount from that MSRP number is. This is useful information because you can reverse the pitch and tell your client "We are providing a X% discount from retail!".
The next part to this is adding your desired profit as a full number (do not add the %). Test out all numbers, but 30 is standard. Some products may force you to go lower.
At the bottom, you will see the results. What your margin is, what your profit is specifically as a dollar amount, and sales price as well as discount from MSRP.
Or - Sign up for indema!
Our FF+E page does all of this for you. Not only that, we consider 2 other profit structures: Markup and flat-rate fee.
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