Cultural Enterprise Office

Fiona Chautard explains the differences.

Your cost price is your calculation of what it costs you to design, make, market and deliver one product to your client. It includes:

• Your time times hourly rate
• Materials
• percentage of cost for overheads such as studio rent, telephone and transport

Costing your product correctly is the basis of how you price your work going forward. 

Your trade or wholesale price is what your retailers pay you i.e. it is the price you charge to trade buyers. It is your cost price, plus a mark-up or profit margin. In the fashion and textile industry, this is approximately about two times as much as your cost price.

The retail price is what the consumer pays to the retailer, shop owner or directly to you e.g. via your online shop. This is normally two and a half to three times the wholesale price, depending on the mark-up of the retailer.

It is important to note that the retailer needs to charge a higher mark-up to cover their own higher overheads such as shop rent, staff, taxes and business rates. Beware of discrepancies in retail price when supplying a retailer and also offering the same product through your own online shop. It is important not to undercut the retailer as this could result in them not buying from you in the future.

Disclaimer: We want to keep you in the know, so we offer a wide selection of useful resources. But Cultural Enterprise Office isn’t responsible for the advice and information of external organisations in this document. So if you have any questions, please contact the specific organisation directly.