What are Cost, MSRP, and Margin?

Cost is defined by our platform as the wholesale price (the per-unit cost of a product to retailers). The cost you list should not include any anticipated distribution or shipping costs. Buyers know these specific details will be worked out later and should not be included in your cost. 

The Manufacturer's Suggested Retail Price (MSRP) and Recommended Retail Price (RRP) define the price point at which the manufacturer recommends a Retailer sell their product. This price should reflect the estimated value of a product to consumers.

The Margin is the value between the two, and would be the amount a retailer makes if they bought your product at the specified Cost, and sold it at the specified MSRP (or RRP).

Calculating Margin for US, EU, and Canada-based RangeMe accounts:

Cost and MSRP (RRP in Europe) are used to calculate a product's Gross Margin for buyers who view your products. 

The Buyer Gross Margin % is calculated as follows: 

Example: MSRP is $10.99, and the Cost to a buyer is $6.99. 

($10.99-$6.99) / $10.99 = 4 / 10.99 or a 36% Margin. 

It is encouraged to input more information about your pricing in the "Pricing Comments" field in your Product Profile Form. Clarify your minimum purchase quantity or any other pricing details there. 

Please note that unrealistic prices, such as $0.01/$0.02 for products, will not be approved. Feel free to review this Help Center article for more information on pricing comments. 

Buyers understand that these figures are just estimates, so the final cost is still up for negotiation between you and any interested retail buyers.

Calculating Margin for AU, NZ, MX, and GB/UK-based RangeMe accounts:

Cost and RRP are still used to calculate a product's Gross Margin for buyers who view your products. Only now, your country's tax rate (GST or VAT, depending on your country) will be taken into account.

Your Cost should not include GST or VAT.

Your RRP value should include GST or VAT.

The GST or VAT rate will be specified when specifying your product's Cost and RRP.

The Buyer Gross Margin % is calculated as follows: 

Note: RRP without VAT is calculated to determine the retailer's Margin. The 1.20 comes from the VAT used in this calculation, which is 1 + VAT.

Here is an example using the numbers and the formula in the screenshots above:

• Cost: £6.99 (Don't include VAT in wholesale cost to retailer)
• RRP: £10.99 (Include VAT here in price retailer would sell product at)
• VAT Rate: 20%

Plugging in those numbers: 

RRP / 1.20 VAT Rate = £10.99 / 1.20 VAT rate = £9.1583 (Rounded up to £9.16)

(£9.16-£6.99) / £9.16 = £2.17 / £9.16 = 23.68% Margin (Rounded up to 24%)

This gives us that £2.17 (24%) value for the Gross Margin shown on your product:

Are Your Products Not Getting Approved?

Pricing is a mandatory field because it gives buyers an idea of how much an item costs, and how much they can possibly make in return. In order to have your products approved and published, the products will need to reflect realistic pricing. What this means is you should not insert any pricing such as $0.01/$0.02 for Cost/MSRP respectively to try and avoid pricing. 

You also want to make sure that your pricing does not include any shipping or distribution costs as all these terms are negotiable.