What is a "price margin"?

What is a "price margin"?

William A. Cohen (Author & Founder, Institute of Leader Arts) gives expert video advice on: How do I determine what to price my product or service?; What is a "price margin"? and more...

Regarding small business and pricing, with a price margin, it costs you so much to produce this item and now you're charging so much. So let's say that for in the case of garden hoses it costs you two dollars and you're charging to the wholesaler four dollars. Okay, here the margin is two dollars and you make two dollars on that. Now, the retailer may add something additional to that so maybe six ninety-five we'll say is the retail price, so he's paying four dollars now; he is makes two dollars ninety-five cents on that deal from four dollars and six ninety-five. That's a price margin in business.