Cost-plus pricing
In one sentenceSetting the selling price by adding a fixed profit percentage to the unit cost; it is one of the simplest and most widely used pricing methods.
Simply put
You calculate the full unit cost and then add a markup you choose on top of it, which gives the selling price.
The method is easy and clear, but it does not look at competitors' prices or at what the customer will accept, so always check the resulting price against the market.
Worked example
A spare parts store's cost for a filter is 80 SAR, and it adds 25% to the cost.
Unit cost80 SAR
Markup amount80 × 25% = 20 SAR
Selling price before VAT80 + 20 = 100 SAR
Formula: Unit cost × (1 + markup)
Don't confuse it with
Gross profit marginA 25% markup on cost gives a margin of only 20% of the selling price (20 ÷ 100).
in FullScreen ERP
Smart pricing in the system suggests the selling price based on cost, supplier prices and item movement. Purchasing and suppliers