Markdown Formula:
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Markdown calculation determines the reduced sale price of an item based on the original price and the percentage discount being applied. It's commonly used in retail and e-commerce.
The calculator uses the markdown formula:
Where:
Explanation: The formula calculates the sale price by subtracting the discount amount from the original price.
Details: Accurate markdown calculations are essential for pricing strategies, profit margin analysis, and inventory management in retail businesses.
Tips: Enter the original price in USD and the markdown percentage (0-100). Both values must be valid (price > 0, markdown between 0-100).
Q1: What's the difference between markdown and markup?
A: Markdown reduces the price (discount), while markup increases the price (profit margin).
Q2: How do I calculate the markdown percentage from sale price?
A: Use: (1 - Sale Price/Original Price) × 100
Q3: Can markdown be more than 100%?
A: No, practical markdowns range from 0-100%. Over 100% would mean paying customers to take the product.
Q4: Why do retailers use markdowns?
A: To clear inventory, attract customers, and compete with other sellers.
Q5: How does this differ from sales tax calculation?
A: Markdown reduces price before tax, while sales tax is added after the final price is determined.