- #1
Puzzled
- 4
- 0
Hello,
I have recently been given a job in Sales, and I really enjoy it. Math has never been a strong point and I struggle with percentages.
I had an embarrassing experience the other day, where my manager jokingly asked me in front of everyone ‘If our product cost $100 and we want to make 50% Gross profit margin, what the selling price?’ I said ‘$150’ but I am told the answer is $200.
I have found online that the calculation is:
$100 / 0.5 = $200
I seem to be using a mark-up calculation.
$100 x 1.5 = $150
Is there any easy way to calculate margin in your head?
Why there is a difference, and businesses don’t just use mark up?
Thanks everyone.
I have recently been given a job in Sales, and I really enjoy it. Math has never been a strong point and I struggle with percentages.
I had an embarrassing experience the other day, where my manager jokingly asked me in front of everyone ‘If our product cost $100 and we want to make 50% Gross profit margin, what the selling price?’ I said ‘$150’ but I am told the answer is $200.
I have found online that the calculation is:
$100 / 0.5 = $200
I seem to be using a mark-up calculation.
$100 x 1.5 = $150
Is there any easy way to calculate margin in your head?
Why there is a difference, and businesses don’t just use mark up?
Thanks everyone.