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Thread: Pricing Formula for Selling Price

  1. #1

    Cool Pricing Formula for Selling Price

    Hi,

    Looking for some help from some maths intellects as I cannot fathom how to do this.

    I sell good online and I want to list items at a certain margin percentage.

    Is it possible to use a formula to list at the correct selling price by setting a margin percentage. So the factors to consider in the formula would be below.

    Cost Of Item - 5.11
    Postage Cost - 2.2
    PayPal Fixed Fee - .2
    PayPal Fee % - 1.9% of final selling price
    Ebay Fee % - 7% of final selling price
    UK VAT - 20% - Final Selling Price *.166


    The correct listing price for 20% margin should be around 13.8, however I have got this by just changing prices rather than using a formula to calculate the margin beforehand.

    Thanks in advance if anyone can point me in the correct directions.

  2. #2
    Elite Member
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    Quote Originally Posted by fearmhor18 View Post
    Hi,

    Looking for some help from some maths intellects as I cannot fathom how to do this.

    I sell good online and I want to list items at a certain margin percentage.

    Is it possible to use a formula to list at the correct selling price by setting a margin percentage. So the factors to consider in the formula would be below.

    Cost Of Item - 5.11
    Postage Cost - 2.2
    PayPal Fixed Fee - .2
    PayPal Fee % - 1.9% of final selling price
    Ebay Fee % - 7% of final selling price
    UK VAT - 20% - Final Selling Price *.166


    The correct listing price for 20% margin should be around 13.8, however I have got this by just changing prices rather than using a formula to calculate the margin beforehand.

    Thanks in advance if anyone can point me in the correct directions.
    How do you calculate Margin?
    “... mathematics is only the art of saying the same thing in different words” - B. Russell

  3. #3
    Quote Originally Posted by Subhotosh Khan View Post
    How do you calculate Margin?
    Hi,

    I calculate the margin percentage with the gross profit divided by the final listing price.

    However I want a formula that determines the final listing price using the margin percentage and others.

  4. #4
    Elite Member
    Join Date
    Jul 2014
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    3,386
    Quote Originally Posted by fearmhor18 View Post
    Hi,

    Looking for some help from some maths intellects as I cannot fathom how to do this.

    I sell good online and I want to list items at a certain margin percentage.

    Is it possible to use a formula to list at the correct selling price by setting a margin percentage. So the factors to consider in the formula would be below.

    Cost Of Item - 5.11
    Postage Cost - 2.2
    PayPal Fixed Fee - .2
    PayPal Fee % - 1.9% of final selling price
    Ebay Fee % - 7% of final selling price
    UK VAT - 20% - Final Selling Price *.166


    The correct listing price for 20% margin should be around 13.8, however I have got this by just changing prices rather than using a formula to calculate the margin beforehand.

    Thanks in advance if anyone can point me in the correct directions.
    Using
    final selling price = a * total cost
    profit = final selling price - total cost
    you should be able to determine what you need

    -Ishuda

  5. #5
    Quote Originally Posted by Ishuda View Post
    Using
    final selling price = a * total cost
    profit = final selling price - total cost
    you should be able to determine what you need
    Hi, Thank you for your advice.

    I'm not sure if we are looking at the same problem. I was looking for a formula (that I could use in a spreadsheet for example) whereby I put in the following factors.

    Cost Of Item - 5.11
    Postage Cost - 2.2
    PayPal Fixed Fee - .2
    PayPal Fee % - 1.9% of final selling price
    Ebay Fee % - 7% of final selling price
    UK VAT - 20% - Final Selling Price *.166
    Margin %

    and get a final selling price

  6. #6
    Elite Member
    Join Date
    Jul 2014
    Posts
    3,386
    Quote Originally Posted by fearmhor18 View Post
    Hi, Thank you for your advice.

    I'm not sure if we are looking at the same problem. I was looking for a formula (that I could use in a spreadsheet for example) whereby I put in the following factors.

    Cost Of Item - 5.11
    Postage Cost - 2.2
    PayPal Fixed Fee - .2
    PayPal Fee % - 1.9% of final selling price
    Ebay Fee % - 7% of final selling price
    UK VAT - 20% - Final Selling Price *.166
    Margin %

    and get a final selling price
    I do programming (including spreadsheets) for $50 an hour and am picky about what I choose to do. So I generally don't give out formulas for programs and spread sheets.

    But to try to help a little more, set your 'margin', i.e. 0.2 [20%] and add 1 to it. That is the a [=1.2 in your case]. That will give you selling price and finally your total cost, i.e. add all the costs. Check your profit to see if it is sufficient.

    BTW: You really haven't listed all of your costs. For example, if you drive to the post office, you would also have car

    -Ishuda

  7. #7
    Quote Originally Posted by Ishuda View Post
    I do programming (including spreadsheets) for $50 an hour and am picky about what I choose to do. So I generally don't give out formulas for programs and spread sheets.

    But to try to help a little more, set your 'margin', i.e. 0.2 [20%] and add 1 to it. That is the a [=1.2 in your case]. That will give you selling price and finally your total cost, i.e. add all the costs. Check your profit to see if it is sufficient.

    BTW: You really haven't listed all of your costs. For example, if you drive to the post office, you would also have car
    Hi,

    I understand. The additional costs I have deliberately left out and just costed for it in the postage cost.

    I will try and develop something myself a little here and if no good I might take you up on making one for me for a cost.

    Thanks.

  8. #8
    Elite Member
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    Feb 2004
    Location
    Ottawa, Ontario
    Posts
    17,039
    Quote Originally Posted by fearmhor18 View Post
    UK VAT - 20% - Final Selling Price *.166
    Could you explain/expand that one?
    I'm just an imagination of your figment !

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