Work out markdown percentage instantly with clear inputs, formula shown and shareable results.
A markdown percentage is measured against the original price, but its damage is measured in margin points. A 30% markdown on a 52% margin item leaves about 32% margin — which is why markdown planning and initial markup are inseparable decisions.
Markdown percentage
Markdown % = (Original price - Markdown price) / Original price x 100
Margin after markdown
Margin % = (Markdown price - Cost) / Markdown price x 100
Not if it clears stock before it becomes unsaleable. The alternative to a 40% markdown is often a 100% write-off.
A planned sequence of reductions — commonly 20%, then 30%, then 50% — timed to sell-through so that the last units clear before season end.