Retail

Markup isn't margin — what do you really keep?

The most common pricing mistake in the salon: a “50% markup” is only a 33% margin. Price a take-home product properly, see the real margin you keep, and the easy profit retail adds with zero extra chair time.

Cost price (ex GST)

Your wholesale buy price per unit, GST-exclusive.

Selling price / RRP (inc GST)

What the client pays at the counter (AU shelf prices show inc GST).

Extra cost per unit

Card fees, staff commission, shrinkage allowance. Optional.

Target margin %

Salon retail typically runs 50–60% gross margin.

Units sold per week

For the annual profit projection.

Real gross margin

49.9%

That's a 99.7% markup on cost — but only a 49.9% margin on the sell price. At 20 units a week this product earns about $15,553 a year in near-pure profit, with no extra chair time.

Gross profit / unit

$14.95

ex GST

Margin (on sell)

49.9%

what you keep

Markup (on cost)

99.7%

not the same number

RRP for 50% margin

$33.00

inc GST

Margin = profit ÷ selling price (ex GST). Markup = profit ÷ cost. They are never the same number — a 50% markup is a 33% margin. RAG on margin: green 50%+, amber 40–49%, red under 40%.

A working tool, not financial advice. It uses the figures and assumptions you enter — check them against your own numbers and your accountant before any pricing, wage or financial decision. Award and tax figures change (often each 1 July); verify current rates at fairwork.gov.au and ato.gov.au. Shear Profit gives no tax or financial advice.

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