About the Markdown Calculator
What is the Markdown Calculator?
A markdown is a permanent price cut, usually to clear slow stock. This markdown calculator shows the new price and, if you enter your cost, how much margin the markdown eats.
It also shows the extra sales volume needed to earn the same profit – often far more than retailers expect.
How to use the Markdown Calculator
- Original Selling Price (₹) (sample: 2,000)
- Markdown (%) (sample: 25)
- Your Cost per Unit (₹, optional) (sample: 1,200)
- Press Calculate Markdown (results also refresh as you type). The result card shows the Marked-Down Price, along with Markdown amount, Margin before markdown, Margin after markdown and Profit per unit after markdown.
Formula used
Sale price = Original price × (1 − Markdown %)
- Extra units needed = original profit per unit ÷ new profit per unit − 1
A 25% markdown on a product with a 40% margin cuts the profit per unit from ₹800 to ₹300 on a ₹2,000 item, so you need 2.67 times the volume.
Worked example
These are the sample values already filled in the calculator above, and the result it returns for them:
| Input | Sample value |
|---|---|
| Original Selling Price (₹) | 2,000 |
| Markdown (%) | 25 |
| Your Cost per Unit (₹, optional) | 1,200 |
| Result | Value |
|---|---|
| Marked-Down Price | ₹1,500 |
| Markdown amount | ₹500 |
| Margin before markdown | 40% |
| Margin after markdown | 20% |
| Profit per unit after markdown | ₹300 |
| Extra units needed to keep the same profit | 166.7% |
Tips for using the Markdown Calculator
- Mark down early in the season; late markdowns need deeper cuts.
- Bundle slow items with best-sellers as an alternative to deep markdowns.