Every business is different, so you will need to figure out how much profit you need to make to sustain your business. But a general rule of thumb is to double your production cost and that is your wholesale price. The retailer will then double the wholesale price to get the retail price. So for instance, if your production cost is $5 per shirt, your wholesale price should be $10. The retailer will them mark it up to $20 when selling to the consumer.
The challenge for most startup brands is that your production costs are probably a bit high because your volume is fairly low. So those high costs tend to drive up the wholesale and retail prices which severely limits the profit margins for retail stores. This is one of the reasons why startup brands are undesirable to retail stores.
The challenge for most startup brands is that your production costs are probably a bit high because your volume is fairly low. So those high costs tend to drive up the wholesale and retail prices which severely limits the profit margins for retail stores. This is one of the reasons why startup brands are undesirable to retail stores.
