Free Wholesale Pricing Tool Pricing & Profitability

Target Selling Price Calculator

Work backwards from your desired margin to find the selling price your business needs.

Enter your landed or total unit cost and desired gross margin to calculate the minimum net selling price required to achieve your profitability target.

You can also account for planned customer discounts, tax and order quantity to estimate list price, revenue and total gross profit.

Free to use Instant estimate Built for sourcing & trade

Margin Target-based pricing

Price Required selling price

B2B Built for wholesale buyers

Total Cost per Unit

Enter the complete cost attributable to one unit. For imported products, landed cost is usually more useful than factory price alone.

Currency

Use the same currency for all monetary values. This calculator does not perform live currency conversion.

Target Gross Margin

Enter the percentage of net sales you want to remain as gross profit after the unit cost.

Expected Customer Discount

Optional. Enter a normal discount you expect to give from your list or quoted price. The calculator will estimate the higher list price required to preserve your target net selling price.

Sales Tax / VAT / GST

Optional tax percentage. Tax is shown separately and is not treated as business revenue or gross profit.

Planned Sales Quantity

pcs

Enter the number of units you expect to sell to estimate total revenue and gross profit.

Important Pricing Note

This calculator uses gross margin, not markup. A 40% gross margin does not mean adding 40% to your cost.

Target Price

Target Selling Price

Enter your pricing targets

Add your unit cost, target margin and other commercial assumptions to calculate the required selling price.

Estimates generated by this calculator are for preliminary planning only. Actual manufacturing cost, finished weight, material consumption, packing, freight, duty, container utilization or other commercial results may vary according to construction, specifications, production method and supplier.

About this calculator

What Is a Target Selling Price Calculator?

Setting a selling price is one of the most important commercial decisions in wholesale, retail and importing. A price that looks profitable can still generate an inadequate margin if the business confuses markup with gross margin or fails to include the complete product cost.

Primeval's Target Selling Price Calculator works backwards from your desired gross margin. Instead of asking how much percentage should be added to cost, it asks what selling price is required so that the chosen percentage of sales revenue remains after the product cost is deducted.

This approach can be particularly useful for importers, wholesalers, retailers, private-label brands, sourcing companies and home-furnishing businesses calculating prices from FOB or landed costs.

The calculator can also estimate a higher list or quotation price when you expect to offer a discount, helping you understand whether promotional or negotiated pricing could reduce your intended margin.

Simple process

How to Calculate a Target Selling Price

Enter your specifications and use the result as a practical starting point for product, sourcing and shipment planning.

Enter your complete unit cost

Enter the cost associated with one saleable unit. For importers this may be landed cost rather than only FOB or factory price.

Set your target gross margin

Enter the percentage of net selling revenue you want to remain as gross profit after product cost.

Add an expected discount

If your normal commercial practice includes buyer discounts, promotional reductions or negotiated discounts, enter the expected percentage.

Add sales tax if needed

Enter VAT, GST or sales tax when you want to see an indicative customer-facing tax-inclusive price.

Enter planned quantity

Add the number of units expected to be sold to estimate total cost, net revenue and gross profit.

Review your target price

Compare required net selling price, suggested list price, gross profit, equivalent markup and total projected profitability.

Gross margin measures profit as a percentage of selling revenue. To calculate the selling price required to achieve a specific margin, divide unit cost by one minus the target margin expressed as a decimal.

This is different from markup, which measures profit relative to cost.

Formula

Target Selling Price = Unit Cost ÷ (1 − Target Gross Margin)

What the values mean

Unit Cost: The complete cost associated with one unit.
Target Gross Margin: Desired gross profit as a percentage of net sales revenue.
Selling Price: The net selling price required to achieve the specified target margin.
Gross Profit: Selling price minus unit cost.
Markup: Gross profit expressed as a percentage of unit cost rather than selling price.
Expected Discount: Percentage reduction expected from the list or quoted price.

Practical examples

Target Selling Price Examples

See how typical values translate into a useful planning estimate.

Example 1

$10 Cost with a 40% Target Margin

A common mistake is adding 40% to the $10 cost and selling at $14. That produces only a 28.6% gross margin. A true 40% gross-margin target requires a higher selling price.

Unit Cost: $10.00
Target Gross Margin: 40%
Equivalent Markup: 66.7%

Result $16.67 required selling price

Example 2

$20 Landed Cost with a 50% Target Margin

At a 50% gross-margin target, the cost represents half of the required selling price.

Landed Cost: $20.00
Target Margin: 50%
Gross Profit per Unit: $20.00

Result $40.00 required selling price

Example 3

$15 Cost, 40% Margin and 10% Buyer Discount

If the business needs a $25 net selling price after giving a 10% discount, the initial list or quoted price must be higher.

Unit Cost: $15.00
Target Margin: 40%
Expected Discount: 10%

Result $25.00 target net price; approximately $27.78 list price

Example 4

500 Units at $10 Cost and 40% Margin

Quantity calculations help show how a per-unit margin translates into total commercial performance.

Quantity: 500 pcs
Unit Cost: $10.00
Selling Price: $16.67

Result Approximately $3,333 total gross profit

Pricing Strategy

What Is a Target Selling Price?

A target selling price is the price a business needs to charge to meet a specific commercial objective. One of the most practical objectives is achieving a desired gross margin after covering the product's direct or landed cost.

Rather than choosing a selling price first and discovering profitability later, target-margin pricing works backwards from the profit percentage the business wants to maintain.

This can create a more disciplined pricing process for wholesalers, importers and retailers dealing with products that have varying supplier costs, freight, duties and other landed-cost components.

Core Formula

How to Calculate Selling Price from Cost and Margin

If you know your unit cost and desired gross margin, calculate the required selling price by dividing cost by one minus the margin percentage expressed as a decimal.

Selling Price Required at Different Gross Margins

Unit Cost	Target Margin	Required Selling Price
$10	20%	$12.50
$10	30%	$14.29
$10	40%	$16.67
$10	50%	$20.00
$10	60%	$25.00
$10	70%	$33.33

Margin vs Markup

Gross Margin and Markup Are Not the Same

Margin and markup both describe profit relationships, but they use different bases.

Gross margin compares gross profit with selling price. Markup compares gross profit with cost.

Confusing them can result in prices materially below the intended profitability target.

Gross Margin vs Equivalent Markup

Target Gross Margin	Equivalent Markup on Cost
10%	11.1%
20%	25.0%
30%	42.9%
40%	66.7%
50%	100.0%
60%	150.0%
70%	233.3%

Common Error

Why Adding Your Target Margin Percentage to Cost Gives the Wrong Result

Suppose a product costs $10 and the business wants a 40% gross margin. Adding 40% to cost produces a selling price of $14.

The gross profit would be $4, but $4 divided by the $14 selling price equals only 28.6%. The business therefore fails to achieve its intended 40% margin.

To achieve a true 40% gross margin, the required selling price is approximately $16.67.

Cost Base

Which Cost Should You Use in the Calculator?

The quality of a target-price calculation depends heavily on the cost entered. Using only supplier price can overstate profitability when the business also pays freight, duty, inspection, packaging or other costs.

Factory / Ex-Works Cost May represent only the price at the manufacturer's premises.
FOB Cost May include additional origin costs depending on the commercial agreement.
Landed Cost Often more useful for import pricing because it can include freight, duty and other import-related costs.
Warehouse Cost Some businesses allocate inbound handling and warehouse expenses before pricing.
Fully Loaded Cost May include additional directly attributable commercial expenses depending on the company's costing policy.

Importers

Why Importers Should Often Price from Landed Cost

A product purchased from an overseas supplier for $10 does not necessarily cost the importing business $10. Ocean or air freight, insurance, customs duty, clearance, destination charges and inland transportation can increase the real inventory cost.

If target selling price is calculated only from factory cost, gross margin may appear stronger than it actually is once import expenses are included.

Calculating landed cost first and then applying the target-margin formula can provide a more commercially meaningful starting point.

Wholesale

Target Selling Price for Wholesale Businesses

Wholesale pricing needs to cover product cost while supporting operating expenses and profit. The appropriate gross margin varies widely according to category, business model, market, channel, services and competitive conditions.

The calculator should therefore not be interpreted as recommending a specific target margin. Instead, it calculates the price mathematically required for the margin chosen by the business.

Retail

Target Selling Price for Retail Products

Retailers may need to consider several additional factors beyond landed product cost, including marketplace commissions, payment fees, fulfilment, returns, promotions, store expenses and markdowns.

A gross-margin target based only on merchandise cost can still be useful, but businesses should distinguish product gross margin from final net business profitability.

Discount Planning

How Discounts Affect Your Target Selling Price

If customers normally receive discounts, the initial list or quotation price may need to be higher than the minimum net selling price required for the target margin.

For example, if the target net selling price is $25 and a buyer normally receives a 10% discount, quoting exactly $25 would reduce the realised selling price to $22.50. To retain approximately $25 after a 10% discount, the starting price needs to be about $27.78.

B2B Negotiation

Build Negotiation Room into Wholesale Quotations

B2B buyers may ask for price reductions during negotiations. A supplier or wholesaler that quotes its absolute minimum profitable price immediately has little commercial room to negotiate without reducing margin.

The expected-discount field can be used to estimate a starting quotation that still reaches the target net price after the anticipated reduction.

Know the minimum net price Calculate the price needed to preserve your target margin.
Estimate likely discount Use realistic historical negotiation patterns rather than arbitrary assumptions.
Set the starting quote Calculate a list or quotation price that can absorb the planned discount.
Track realised margin Compare actual selling prices with planned margin after orders are completed.

Tax

Should VAT, GST or Sales Tax Be Included in Selling Price?

Tax treatment depends on the jurisdiction and whether prices are displayed or negotiated on a tax-exclusive or tax-inclusive basis.

This calculator treats entered sales tax separately from net product revenue. The gross-margin calculation is based on the tax-exclusive target selling price.

Consult the applicable tax rules for your business and market before setting customer-facing prices.

Gross Profit

How to Calculate Gross Profit per Unit

Gross profit per unit is the net selling price minus the product cost used in the calculation.

For example, if a product costs $12 and sells for $20, gross profit is $8 per unit. Gross margin is therefore 40%, because the $8 gross profit represents 40% of the $20 selling price.

Order Planning

Calculate Total Revenue and Gross Profit

Per-unit profitability can be extended across a planned sales quantity to create an indicative commercial forecast.

Total Cost Unit cost multiplied by planned quantity.
Net Revenue Target net selling price multiplied by quantity.
Gross Profit Gross profit per unit multiplied by quantity.

Market Reality

Your Calculated Target Price Must Still Work in the Market

A mathematically correct target selling price does not guarantee that customers will accept it. Competitor pricing, product differentiation, perceived value, quality, branding, distribution channel and customer expectations all influence achievable selling prices.

If the market cannot support the required price, the business may need to reduce cost, adjust its margin expectation, modify the product or reconsider the commercial model.

Cost Engineering

What to Do If Your Target Selling Price Is Too High

If the required price is significantly above the market, reducing margin is only one option. Businesses can also investigate whether the underlying cost structure can be improved.

Negotiate supplier cost Higher volumes, consolidated orders or material changes may improve purchasing economics.
Optimize freight Better packing, consolidation or freight mode can sometimes reduce landed cost.
Review packaging Over-specified packaging can increase cost without adding sufficient customer value.
Improve product design Cost engineering can sometimes preserve the intended appearance while reducing manufacturing cost.
Reduce unnecessary complexity Excessive variations, trims, processes or components may increase unit cost.
Improve order planning Better production quantities may reduce setup and procurement costs.

Home Textiles

Using Target Pricing When Sourcing Home Textile Products

Home-textile buyers can use target-margin pricing when evaluating rugs, cushions, throws, curtains, bedding and other imported products.

A useful workflow is to determine the expected landed cost, calculate the target selling price, compare the result with the intended market position, and then negotiate product specifications or sourcing costs where necessary.

Buyer Workflow

A Practical Pricing Workflow for Importers

1. Obtain supplier pricing Confirm the factory or FOB price for the intended specification and quantity.
2. Calculate landed cost Add freight, duty and other relevant import expenses.
3. Set a target gross margin Choose the margin appropriate to your commercial model.
4. Calculate required selling price Use the target-margin formula to determine the minimum net price.
5. Allow for discounts Build realistic promotional or buyer negotiation allowances into the list price.
6. Compare with the market Evaluate whether the resulting price is commercially achievable.

Pricing Decisions

Target Price Is a Planning Tool, Not a Pricing Rule

This calculator performs mathematical pricing analysis based on the cost, target margin, discount and tax values entered. It does not know your operating expenses, competitor pricing, customer demand, payment fees, returns, inventory risk or commercial strategy.

Use the result as a decision-making reference and combine it with your own financial, market and accounting information before establishing final selling prices.

For importers & buyers

Before Finalizing a Selling Price

A strong pricing decision needs both accurate cost information and realistic market assumptions. Check the cost base carefully before relying on the calculated margin.

Use complete product cost

For imported products, consider whether landed cost is more appropriate than supplier price.

Do not confuse margin and markup

A 40% markup produces a much lower gross margin than a 40% target margin.

Allow for discounts

Regular promotions or negotiated reductions can materially reduce realised margin.

Separate tax from revenue

VAT, GST or sales tax collected for authorities should generally not be interpreted as gross profit.

Consider channel costs

Marketplace fees, fulfilment, commissions and payment charges can affect profitability.

Compare with achievable market price

A mathematically required price still needs to be acceptable to customers.

Source with Primeval

Need a Better Product Cost Before Setting Your Selling Price?

Primeval helps international buyers source home-textile products from India. Share your product specification, quantity, packaging and target requirements to discuss actual factory pricing.

Once you have a realistic supplier or landed cost, use this calculator to evaluate the selling price required for your intended margin.

Rugs and carpets
Cushion covers
Throws and blankets
Curtains
Bed linen
Table textiles
Kitchen textiles
Bath textiles
Custom designs
Private-label products
Custom packaging
Sampling support
Factory sourcing
Wholesale manufacturing
Export production

Buyer questions

Target Selling Price Calculator FAQs

Helpful answers about calculations, sourcing estimates and commercial planning.

How do I calculate target selling price?

Divide unit cost by one minus the target gross margin expressed as a decimal. For example, a $10 cost with a 40% target margin requires a selling price of approximately $16.67.

What is the formula for selling price from cost and margin?

Target Selling Price = Unit Cost ÷ (1 − Target Gross Margin). A 40% margin should therefore be entered as 0.40 in the mathematical formula.

What selling price gives a 20% margin?

Divide cost by 0.80. If unit cost is $10, the required selling price is $12.50.

What selling price gives a 30% margin?

Divide cost by 0.70. If unit cost is $10, the required selling price is approximately $14.29.

What selling price gives a 40% margin?

Divide cost by 0.60. If unit cost is $10, the required selling price is approximately $16.67.

What selling price gives a 50% margin?

Divide cost by 0.50. A $10 cost therefore requires a $20 selling price for a 50% gross margin.

Is 50% margin the same as 50% markup?

No. A 50% markup on a $10 cost produces a $15 selling price and approximately 33.3% gross margin. A true 50% margin requires a $20 selling price, which equals a 100% markup.

What is the difference between margin and markup?

Gross margin measures gross profit as a percentage of selling price. Markup measures gross profit as a percentage of cost.

Why is gross margin calculated from selling price?

Gross margin represents the percentage of sales revenue remaining after the associated product cost is deducted.

Why can't I simply add my target margin percentage to cost?

Because adding a percentage to cost calculates markup rather than gross margin. If you add 40% to a $10 cost, the $14 price produces only about 28.6% gross margin.

Should I use factory cost or landed cost?

That depends on your costing objective. Importers often obtain a more useful pricing estimate from landed cost because it can include freight, duty and other import expenses.

Can I use FOB price as my unit cost?

Yes, but the resulting margin will only measure profitability relative to FOB cost. If additional freight, duty or destination expenses are material, consider using landed cost instead.

Does the calculator include freight?

Only if freight is already included in the unit cost you enter. The calculator does not automatically add freight.

Does the calculator include customs duty?

Only if duty is already included in the unit cost entered. Use a landed-cost calculation first if you want import expenses incorporated.

How does the discount calculation work?

The calculator increases the initial list or quotation price so that after the expected percentage discount, the realised selling price approximately equals the target net selling price.

Why should I allow for buyer discounts?

If discounts are common in your channel, pricing only at the minimum target price can cause realised margins to fall below your plan when discounts are given.

Is the list price the same as target selling price?

Not necessarily. The target selling price is the required net price after planned discounts. The suggested list price can be higher to provide discount or negotiation room.

Does the calculator include VAT or GST?

You can enter a tax percentage to estimate an indicative tax-inclusive price. Tax is kept separate from the gross-margin calculation.

Should gross margin be calculated before or after sales tax?

This calculator calculates gross margin using the tax-exclusive net selling price because sales tax collected for authorities is not treated as product revenue.

How do I calculate gross profit per unit?

Subtract unit cost from the net selling price.

How do I calculate total gross profit?

Multiply gross profit per unit by the number of units sold.

How do I calculate equivalent markup from margin?

Equivalent markup equals gross profit divided by cost. The calculator automatically shows the markup corresponding to the selected gross margin.

What markup is equivalent to a 40% gross margin?

A 40% gross margin is equivalent to approximately 66.7% markup on cost.

What markup is equivalent to a 50% gross margin?

A 50% gross margin is equivalent to a 100% markup on cost.

Can this calculator be used for wholesale pricing?

Yes. It can be used to estimate wholesale target prices from a known product or landed cost and desired margin.

Can this calculator be used for retail pricing?

Yes, but retailers should also consider channel fees, fulfilment, returns, markdowns and operating costs when assessing final profitability.

Can importers use this calculator?

Yes. Importers can first calculate landed cost and then use that value as unit cost to determine the target selling price.

Can I calculate selling price in USD, EUR, GBP or INR?

Yes. Select the currency used for your cost inputs. The calculator formats results in that currency but does not perform live exchange-rate conversion.

Can the calculated price be lower than the market price?

Yes. In that situation the business may have room for a higher margin, competitive pricing or additional selling expenses, depending on its strategy.

What if the calculated target price is too high for the market?

You may need to reduce product cost, improve sourcing or freight economics, adjust the specification, lower the target margin or reconsider the commercial model.

Does gross margin equal net profit?

No. Gross margin considers the product cost used in the calculation. Net profit can also be affected by salaries, rent, marketing, administration, financing, returns, taxes and other business expenses.

Is there one correct gross margin for all products?

No. Appropriate margins vary by industry, product category, channel, competition, operating model and business objectives.

Can Primeval help reduce sourcing cost?

Primeval supports sourcing enquiries for home-textile products from India. Buyers can submit specifications and quantities to discuss suitable manufacturing and commercial options.

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Home Textile Sourcing from India

Need a Real Factory Cost Before Setting Your Selling Price?

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