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Dealer Markup

Free Dealer Markup calculator with clear step-by-step results.

About Dealer Markup

Invoice price is not the dealer's cost. Factory holdback - typically 2-3% of MSRP - is rebated after the sale, so a car sold at invoice still earns the dealer money. Adding holdback to the markup over invoice gives the gross profit that actually sits in the deal.

Formulas

Holdback

Holdback = MSRP x holdback percentage

Dealer gross

Gross = (asking price - invoice) + holdback

Worked example

With the default values below, Dealer Markup returns Dealer gross including holdback of $5,262.50. Change any input above and every figure here is recalculated in your browser.

Inputs used

Dealer invoice priceminimum 0 $
27,500 $
Manufacturer suggested retail priceminimum 0 $
30,500 $
Dealer asking priceminimum 0 $
32,000 $
Factory holdback (share of MSRP)accepts 0–10 %
2.5 %

Results

Dealer gross including holdback
$5,262.50
Asking price over invoice
$4,500.00
Asking price versus MSRP
$1,500.00
Dealer margin on the asking price
16.45% %

Step by step

  1. 1Values used
  2. 2Holdback
  3. 3Dealer gross
  4. 4Dealer gross including holdback= $5,262.50
  5. 5Asking price over invoice= $4,500.00
  6. 6Asking price versus MSRP= $1,500.00
  7. 7Dealer margin on the asking price= 16.45 %

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
  • Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

Can I negotiate below invoice?

On slow-moving stock, yes - holdback and volume bonuses mean a below-invoice sale can still be profitable. On allocation-constrained models, asking prices sit above MSRP instead.

Does this include dealer add-ons?

No. Paint protection, fabric treatment and nitrogen-filled tyres carry very high margins and should be assessed separately from the vehicle price.

Related Calculators

Dealer Markup – Calculate Dealer gross including holdback