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Markup (or price spread) is the difference between the selling price of a good or service and its cost.It is often expressed as a percentage over the cost. A markup is added into the total cost incurred by the producer of a good or service in order to cover the costs of doing business and create a profit.
In some cases, the markup is mutually agreed upon by buyer and seller. For markets that feature relatively similar production costs, companies do not have a dominant strategy. [ 7 ] Therefore, cost-plus pricing can offer competitive stability, decreasing the risk of price competition (such as price wars), if all companies adopt cost-plus pricing.
A white-label product is a product or service produced by one company (the producer) that other companies (the marketers) rebrand to make it appear as if they had made it. [ 1 ] [ 2 ] The name derives from the image of a white label on the packaging that can be filled in with the marketer's trade dress .
If margin is 30%, then 30% of the total of sales is the profit. If markup is 30%, the percentage of daily sales that are profit will not be the same percentage. Some retailers use markups because it is easier to calculate a sales price from a cost. If markup is 40%, then sales price will be 40% more than the cost of the item.
A markup rule is the pricing practice of a producer with market power, where a firm charges a fixed mark-up over its marginal cost. [ 1 ] [ page needed ] [ 2 ] [ page needed ] Derivation of the markup rule
Profit margin is calculated with selling price (or revenue) taken as base times 100. It is the percentage of selling price that is turned into profit, whereas "profit percentage" or "markup" is the percentage of cost price that one gets as profit on top of cost price. While selling something one should know what percentage of profit one will ...
A white-label product is not created exclusively for one company, and although white-label manufacturers might offer customizations to their products, these are usually limited. [18] The specifications of a private-label product are set out by the client, whereas a white-label product is more generic and already designed. [19] [20]
White label may refer to: White-label product, a permitted replication and rebranding of a product; White label record, records with plain white labels attached. White Label Music, an independent record label based in the United Kingdom; White Label, an album by Venetian Snares; White Label Records, an imprint of Mushroom Records