Or how to calculate important indicators like Markup Percentage, Turnover, Inventory Return on Investment, Percentage Return on Inventory, etc. That's why it's strategically important. In making volume pricing decisions, be very careful of over-reliance on your cost details. Be assured that the highest percentage of credit problems, schedule changes and other cost impairments will come from your discounted high volume deals.
Salespeople do what they are trained to do.
It's easy to underestimate your operating and overhead costs in setting prices. Almost all the rest is transportation and the manufacturer and distribution mark-ups. Be sure to include all your costs in your prices. And if that requires pricing away some business, so be it. That's the business most likely to put you under.