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But what if your markup wasn't all that high to begin with? That's 7 points off your gross margin, which is nothing to sneeze at. Assuming a 30% gross margin--
by joshwa 19y ago
But what if your markup wasn't all that high to begin with? That's 7 points off your gross margin, which is nothing to sneeze at.
Assuming a 30% gross margin-- to get that $2m, you'd have to spend $1.54m in COGS, for a gross profit of $462k. Add the 70k in amazon fees, and that's starting to seriously affect your balance sheet.
- johnrob 19y agoVery good point. The pricing model probably assumes a high (at least 2x) gross margin. I've heard that specialty goods (i.e. made by small shops) tend to have high margins.