What is a good markup for DTC products?

Most successful DTC brands run 2x to 3x markup on landed COGS, which produces 50 to 70 percent gross margin. Premium positioning supports 4x to 5x. Anything under 2x markup usually needs subscription, high AOV bundles, or wholesale volume to be viable.

Should I set markup the same on every SKU?

No. Hero SKUs that drive acquisition can carry lower markup to maximize conversion. Accessories, upsells, and bundles should carry higher markup because customers are already converted and less price-sensitive. Blended margin is what matters.

How does markup compare to keystone pricing?

Keystone is the traditional retail rule of doubling cost to get price, which is a 100 percent markup or 50 percent margin. DTC needs to go well past keystone because you are paying ad costs that wholesale buyers used to absorb. 2.5x to 3x is the new floor.

What if competitors price lower than my markup calculation?

Before matching price, check their actual margin. Many competitors are either losing money to grab share or have lower COGS from better supplier terms. Racing to their price without understanding their cost structure is how brands die. Differentiate on product or creative instead.

Profit & Pricing · Free Tool

Markup Calculator

Turn cost into price using the markup percent you need. Markup and margin are not the same number, and mixing them up is how brands end up underpricing by 20 percent. This calculator keeps it clean.

Price = Cost × (1 + Markup %)

Unit cost ($)

Markup (%)

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How to use this Markup Calculator

Markup is the percent added to cost to get selling price. Margin is the percent of price that is profit. A 100 percent markup is a 50 percent margin, not 100 percent margin. Getting this backward is the single most common pricing mistake founders make on their first product launch. Use this calculator to lock both numbers before finalizing price tags or wholesale terms.

For DTC brands, typical markup sits between 150 and 300 percent over landed COGS, giving you 60 to 75 percent gross margin. Anything under 100 percent markup (under 50 percent margin) usually cannot support paid acquisition unless you have strong repeat purchase rates. Anything over 400 percent markup needs serious brand work to hold: at that price, customers expect premium experience end-to-end.

If you sell both DTC and wholesale, calculate both channels separately. Wholesale typically needs 40 to 50 percent margin at your sell-in price so retailers can double it to MSRP. Set DTC price to match MSRP (or slightly above with free shipping) to avoid undercutting your retail partners.

Frequently Asked Questions

Markup is over cost: if cost is $10 and price is $30, markup is 200 percent. Margin is of price: profit of $20 on a $30 sale is 67 percent margin. Markup and margin always differ, and the gap widens at higher price points. Always confirm you are comparing the same number across tools.

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