How to price wholesale and retail
If you sell both to stockists and direct to customers, you need two prices — set so everyone in the chain, including you, makes a healthy margin. Get it wrong and you either lose money or lose retailers.
Skip the math — the free wholesale and retail pricing calculator runs this from your own figures.
Open the free calculator →The pricing chain
There are three prices in play: your cost to make an item, the wholesale price you charge a retailer, and the retail price the end customer pays. Each step adds a margin — yours at wholesale, the retailer's at retail.
The whole chain has to work: your wholesale price must cover your cost with profit, and the retail price must give the stockist enough margin to bother carrying you, while still being acceptable to shoppers.
The keystone rule of thumb
A classic starting point is 'keystone' pricing: roughly double the cost to get wholesale, then double the wholesale to get retail. So a $4 cost becomes an $8 wholesale and a $16 retail.
It's only a starting point — some categories carry higher or lower multiples — but it ensures both you and the retailer have room to profit, which is the whole point.
Why you need both prices
If you only set one price, something breaks. Sell direct at your wholesale price and you leave your own margin on the table. Charge retailers your retail price and they can't mark it up, so they won't stock you.
Setting both deliberately lets you sell profitably through both channels at once — the essence of a healthy wholesale-plus-direct business.
Don't undercut your retailers
The fastest way to lose stockists is to sell direct for less than they can. If shoppers can buy cheaper from you than from the shop that stocks you, the retailer stops carrying you.
The fix is to sell direct at (or near) the retail price your stockists charge — you simply keep the extra margin instead of the retailer. Everyone's price stays consistent, and your channels don't compete on price.
Check the margins hold
After setting prices, verify the margins at each step: your wholesale margin (wholesale minus cost, over wholesale) and the retailer's implied margin. If either is thin, the price won't be sustainable for that party.
The free calculator below turns your cost into wholesale and retail prices and shows the margins at each stage, so you can set a price list where every link in the chain makes money.
Questions
What wholesale margin should I aim for?
Enough that wholesale orders are worth making after all your costs — often a wholesale price around double your unit cost (a 50% wholesale margin) as a starting point, adjusted for your category and volumes. Wholesale orders are larger and lower-touch than direct sales, so a somewhat lower margin than retail is normal, but it still has to cover your costs and leave real profit. Check it against your actual cost to produce and fulfil.
Can I sell direct for less than retail?
It's risky if you also sell through stockists. Undercutting the retail price your retailers charge undermines them and can cost you those accounts. The common practice is to sell direct at the same retail price your stockists use, keeping the full margin yourself rather than sharing it — so your channels don't compete on price. If you don't use stockists, you have more freedom, but consistent pricing still protects your brand's perceived value.