How Much Margin Does A Distributor Make?

Margins for Distributors

“Entrepreneur” magazine says that the typical profit margin of a wholesale distributor is around 25 percent.

To put it in perspective, a distribution company with a 25 percent margin that reported annual total revenues of $100,000 paid $75,000 for the goods it sold.

What is a typical distributor margin?

The margin for a distributor may range from 3% to 30% of the sales price, the margin for the retailer may range from very little to 60%.

What is the average distributor markup?

The average wholesale or distributor markup is 20%, although some go up as high as 40%. Now, it certainly varies by industry for retailers: most automobiles are only marked up 5-10% while it’s not uncommon for clothing items to be marked up 100%.

How much margin do retailers make?

Profit margin is the gross profit a retailer earns when an item is sold. In the apparel segment of retail, brands typically aim for a 30-50% wholesale profit margin, while direct-to-consumer retailers aim for a profit margin of 55-65%. (A margin is sometimes also referred to as “markup percentage.”)

What is the profit margin in FMCG?

It depends upon the category of Fmcg products. Generally the distributor gets margin of anywhere between 4% to 6% on his landing cost. It is also a general practice that distributor offers cash discount (CD) to retailers of 1 or 2%. That makes his effective margin around 3 to 5%.