Clothing Pricing Calculator

Start from your true landed cost per unit: the factory price plus freight, insurance, import duty and any import tax you cannot reclaim. Then decide your channels. If you will ever sell to stockists, a common starting point is wholesale at roughly 2× that cost and retail at roughly 2× wholesale, which puts retail near 4× cost. If you only sell direct, you keep the whole gap between cost and retail, but it has to pay for marketing, payment fees, packaging, shipping to customers and returns, which is why direct brands still aim well above 2×. Next, test the number against the market: find three or four brands your customer compares you with and see where you sit. Finally, run it through the calculator: enter your cost and a candidate price and read the margin, or switch to target-margin mode and let it give you the price for the margin you need.

It depends on the channel and on what the margin has to pay for. Many apparel brands target a gross margin of roughly 50 to 70% at retail, measured before overheads. At the bottom of that range a brand selling direct often struggles, because advertising, platform and payment fees, free shipping and returns take a large share of every sale before any profit is left. Keystone pricing, retail at about 4× landed cost, is a 75% gross margin, and it is common precisely because it leaves room for a stockist to take their half at wholesale. A margin is only good if it covers your real costs at your real volumes, so work backwards: estimate what it costs you to win and ship one order, add the landed cost, and check the price still leaves a profit. The calculator gives the exact margin for any cost and price you enter.

Markup compares profit with cost; margin compares profit with price. Markup is usually quoted as a multiple, retail divided by cost: a $6 garment sold at $24 has a 4× markup. Margin is profit as a share of the selling price: the same sale leaves $18 of $24, a 75% margin. The two describe the same sale from different ends, so they convert exactly: margin = 1 − 1 ÷ markup, and markup = 1 ÷ (1 − margin). A 2× markup is a 50% margin, 2.5× is 60%, 3× is about 66.7% and 4× is 75%. The confusion is costly in one direction: a brand that wants a 50% margin and adds 50% to its cost ends up at a 1.5× markup, which is only a 33.3% margin. The calculator shows both numbers side by side, and its price bar shows why: the green share is the margin, and the ticks count the markup.

Keystone pricing means doubling the wholesale price to set retail, so a stockist that buys at $15 sells at $30 and keeps a 50% margin. Combined with the common rule of wholesale at about 2× your landed cost, it puts retail at about 4× cost, which is a 75% gross margin for a brand that sells direct at the same price. It became a convention because it is simple and leaves both the brand and the retailer room for their overheads and for markdowns. It is a starting point, not a law: premium and small-batch brands often price above keystone, while basics in a crowded market can sit below it. The ladder in the calculator marks your price against cost, wholesale and keystone and tells you how far above or below keystone you are, so you can see the gap before you print a single price tag.

Multiply your landed cost per unit by a wholesale multiple. The common starting point is 2×, so a hoodie that costs you $14 delivered sells to stockists at $28, a 50% margin for you. Some brands use up to about 2.5× when selling to shops costs them more, for example through sales agents, trade fairs or sample sets. Then check the other end: a stockist usually multiplies your wholesale price by about 2, which is keystone, so $28 wholesale becomes a $56 shelf price. If that is more than your customer will pay, a higher multiple will not work; you need a lower landed cost instead. Your wholesale margin is wholesale minus cost, divided by wholesale: (28 − 14) ÷ 28 = 50%. The ladder in the calculator does this for you: set the wholesale multiple and the stockist markup with the sliders and it shows each price and who keeps what.

Divide your cost by one minus the margin, written as a decimal. For a 60% margin on a $6.37 cost that is 6.37 ÷ 0.40, which gives $15.925, so charge $15.93. For 70% it is 6.37 ÷ 0.30, about $21.23, and for 50% it is 6.37 ÷ 0.50, which is $12.74. The common mistake is adding the percentage to the cost: $6.37 plus 60% is $10.19, which is only a 37.5% margin. The formula also shows why very high margins get expensive quickly: as the margin approaches 100%, the divisor approaches zero and the price you need climbs steeply, which is why the calculator caps the target at 95%. Switch the calculator to “My target margin”, enter your cost, then drag the slider or pick 50, 60 or 70% to see the price, the profit per piece and where it sits against keystone.

Everything it costs to get one sellable garment into your hands. That starts with the factory price, which should already cover fabric, trims, labels, sewing, any printing or embroidery, finishing, packing and the factory’s own inspection. Then add international freight and insurance per piece, import duty, and any import VAT or GST you cannot reclaim. If your supplier quotes DDP (delivered duty paid), most of those lines are already inside one price, which makes the number easier to trust. Leave out the costs that happen after the goods arrive, such as marketing, payment fees, packaging for your customers, shipping to them and returns. Those are paid out of your margin rather than added to your cost, and the calculator’s gross figures exclude them for that reason. If you are unsure about duty and import tax, the landed cost calculator works them out for the US, UK, EU, Canada and Australia.

No. Work out margin and markup on the price without VAT or GST, because that part of the shelf price belongs to the tax office, not to you. In the UK, the EU and Australia, prices for shoppers are normally shown with the tax included, so a £24 shelf price at 20% VAT is £20 for you and £4 for the tax office. On a £6.37 cost, that is a 68.2% margin, not the 73.5% you would get from the full £24. Your net margin and break-even move the same way, while card fees are usually charged on the full amount the customer pays. In the calculator, tick “Retail price includes VAT/GST” and enter your rate: it shows what the customer pays, the tax and what you receive, and works every result from the amount you receive. US prices are usually shown before sales tax, so leave the box unticked there.

It is worth building in the room even if you never use it. If your retail price is only 2× your landed cost, a stockist buying at half of retail would be paying your cost, so you could never say yes to wholesale without raising your retail price or selling at no profit. Pricing near keystone from the start keeps that door open, and it leaves room for promotions, which also need margin. Selling only direct does not mean you need less margin; it means the margin pays for different things: advertising, platform fees, free shipping and returns instead of a retailer’s cut. The calculator flags any price under 2× cost for this reason. If your market truly will not bear a price near keystone, lower your landed cost through fabric, trims or order size rather than cutting the margin that keeps the business running.

Three forces set most clothing prices, and a sound price satisfies all three. Cost sets the floor: the landed cost per unit plus the overheads each sale has to carry, with a margin on top. The market sets the ceiling: what comparable brands charge for a comparable garment, fabric and fit, as your customer would judge it. Positioning decides where between the two you sit: a brand selling heavyweight organic basics can price above a fast-fashion equivalent, while a brand competing on value has to earn its margin through volume and tight costs. Across channels, the shape of the price ladder usually follows the convention of wholesale at about 2× cost and retail at about 2× wholesale. Fabric weight, construction, decoration and order quantity all move the cost floor, which is why two similar-looking tees can carry very different honest prices.

Because gross margin is measured before the costs that come after the garment arrives. A 70% margin on a $40 hoodie leaves $28 per sale, but that $28 still has to pay for the advertising that found the customer, the platform and payment fees, packaging and shipping to their door, and the orders that come back as returns. For many direct brands, winning the customer is the largest of these. If they add up to $25 per order, the business makes $3 a sale, however healthy the margin looked. The fix is to measure those costs per order and check the margin against them rather than against a benchmark. Selling more items per order, reducing returns with better size guidance, and lowering the landed cost through fabric and order size all help. The calculator’s gross figures leave these out on purpose; add your own in its selling costs panel.

A good margin is one that still leaves a profit after every cost of making a sale, so check it at two levels. Gross margin, price minus landed cost, is the figure most brands quote: many aim for roughly 50 to 70% at retail, and keystone pricing gives 75% when you sell direct. Wholesale is thinner by design: at 2× cost your margin on a stockist order is 50%, because the stockist keeps their own share of the shelf price. The level that decides whether the brand lasts is net margin, after payment and marketplace fees, the shipping you pay for and returns. A healthy gross margin can shrink sharply once those come out. Open the selling costs panel in the calculator, enter your own fee rates and return rate, and read the net margin card. If it is thin, raise the price, cut the landed cost or reduce returns before you scale up.

There is no single right price for a tee, but there is a reliable way to find yours. Work out the landed cost of one sellable shirt first, with the print, labels, freight and duty included, because a tee priced from the blank alone is underpriced before it is listed. Multiply that cost by four for a keystone shelf price that still leaves room for a stockist, or by at least two and a half if you will only ever sell on your own site and know what each order costs you to win and ship. Then compare the result with tees your customer already buys at a similar fabric weight and print. If your keystone price lands well above theirs, fix the cost before the price: fewer print colours and fuller runs per colour bring tee costs down. In the worked example above, a $6.37 tee sold at $30 keeps a 78.8% gross margin.

Yes. They are two ways of writing the same sale, and mixing them up explains many conflicting benchmarks. A markup percentage is profit divided by cost, times 100, so a garment sold for twice its landed cost has a 100% markup. A markup multiple is price divided by cost, so the same garment is 2×. To convert, subtract one from the multiple and multiply by 100: 2.5× is a 150% markup, 3× is 200% and keystone at 4× is 300%. Neither is a margin. Margin divides the same profit by the price instead of the cost, so a 100% markup is a 50% margin and a 300% markup is a 75% margin. When a supplier, a stockist or an article quotes a markup, check which form they mean before you compare it with your own. The calculator reports markup as a multiple and margin as a percentage, so you can read both side by side.

For the basic result you need two: your landed cost per piece, and either the retail price you have in mind or the margin you want. Collect the six lines of that cost from your factory quote and freight forwarder: the garment price, print or embroidery, trims and labels, packaging, freight per piece, and duty and import tax per piece. For the wholesale ladder, decide the multiple you will charge stockists and the markup they are likely to apply. For net margin, look up your payment provider's fee rate and any marketplace fee rate, estimate your return rate from past orders or your category, and note how many pieces a typical order holds and what you pay to ship it. For break-even, add your launch costs, such as samples and photography, and the pieces in the run; our minimum is 150 pieces per style and colour. If your shelf price includes VAT or GST, have the rate to hand too.