Baby/Toddler Products - Retail Margin Expectations

[J.M.S.]

Hi Everyone

I am new to this forum, but hopefully you will be able to help me?

I am looking at importing a baby/toddler product (not clothes/fashion/toys) into the UK. We think, through researching other similar products, that an RRP of around £30 is not unrealistic. However, in order to finally decide on an RRP it would be good to understand what the typical margin expectations are for retailers in this sector?

So to keep things simple, if we were to wholesale the product at £15.00 would a 50% margin, making the retail selling price £30.00, be expected, or would it be higher or lower, typically in this sector? Also, would an on-line retailer be happy with a lower margin expectation, say 40% to 30% as opposed to the shop retailer at 50%?

Finally, to be very cheeky, does anyone have a typical/standard exclusive (as opposed to non-exclusive) distribution agreement they would be happy to share and let me have a copy of please? Very cheeky I know, but if you don't ask!

Many thanks in advance.

 

[J.M.S.]

Just wanted to move the post back-up the order a little just to see if someone can help me. Thanks.

 

[J.M.S.]

Just thought I would move the post back up the list again for the weekend. Really hope someone can help. If anyone has any comments on general retail margin expectations, that would be great.

 

[Anara]

Well I sell this kind of product and I want and tend to get a 100% markup on nearly everything and 250% on the higher end products.

 

[Mister B]

Not sure entirely which mark ups are used within the childrenswear/accessory market but as a rule of thumb, many industries double up from trade, which after allowing for VAT, offers a margin of 41%

Online retailers will not be happy with taking a smaller margin when compared to traditional stores. For sure, they may want to discount the price and cut the margin that way but I would be really surprised if you received no resistance to a two tier pricing structure.

Mister B

 

[J.M.S.]

Thanks guys.

It sounds like I am in the right ball-park and I was told that in general retail terms doubling up the price to give 100% mark-up/50% margin to the retailer was common. So I need to be getting down to a distribution price of at least £12.50 so I can get to an RRP of £25.00.

When it came to online stores I was on the understanding that the majority of online retailers tend to discount slightly from the 'highstreet' RRP. I possibly phrased that question incorrectly, I thought because they had less overhead that it was common for them to offer an item at slightly less than 'highstreet' to attract buyers. I suspected that in actual margin terms per item that they would expect less because the need less to make the same overall 'profit' per item.

 

[J.M.S.]

Well I sell this kind of product and I want and tend to get a 100% markup on nearly everything and 250% on the higher end products.

Just wanted to say, great web-site. Really clear, well laid out, clear postage policy on home page.

You might be interest in the product I am looking to import but it would be on the edge of your current offer. If it starts to stack up can I drop you a PM about it?

Either way, with a 6 month old in the house, I think we might be looking at your web-site for quite a few years!