Pricing of materials for craft companies

Keep dreaming. No one gets up anymore for a 3 percent margin in wholesale.

Not a dream. You have to face reality. You can find the numbers everywhere – whether in statistical portals, industry news, or wherever.
And if you’re really interested, you can even verify this with the figures from annual financial statements.
I just saw Metro’s numbers for Q3: 0.92% profit margin (3.5% adjusted for special effects). Any more questions?

For that, even 12,500 employees get up every day and the shareholders are happy.

The problem is that you are talking about different key figures. talks about profit margin, which is at least the contribution margin 1, but most likely the EBITDA margin or even EBIT margin of the company. So what is at the very bottom of the income statement. talks about margin, possibly means trading margin, but calculates the mark-up or price surcharge of the individual product.

I can only speak from reality regarding trading margins in consumer electronics. The large retail chains usually want to see a 30-35% trading margin from the manufacturer or distributor. So if a product costs 119 EUR at the checkout for the customer, that's 100 EUR net. Then, for example, MM pays the manufacturer / distributor 65 EUR. (53% mark-up according to Buchsbaum's calculation). There are also additional agreements such as advertising cost subsidies, premium shelf placement rent, displays, back-ends that apply from certain minimum sales volumes, etc. And in the end, MM-Saturn has an EBIT of 1.1%.

@nordanney is talking about profit margin, which is at least the DB1 margin, but most likely the EBITDA margin or even EBIT margin of the company. So what appears at the very bottom of the income statement.

Yep. The only margin that ultimately matters for a company.

@Buchsbaum066 is talking ... price markup of the individual product.

That is irrelevant in this context, as the markup always has to be chosen so that the company makes a profit at the end of the day.

I can only speak from reality regarding trade margins for consumer electronics. The large retail chains usually want to see a 30-35% trade margin from the manufacturer or distributor.

... to make any money at all in the end. But the private customer or the tradesman cannot buy from the manufacturer. They go to the wholesaler Saturn/MM or Metro or wherever. And can then compare prices between the "wholesaler" and the tradesman.

So you have to add that it is about the return on sales. And that is always relative.

With 30.55 billion in revenue for Metro, a 0.92 return on sales or profit margin, as you call it, still leaves a solid over 300 million annual profit. But that has nothing to do with the pricing calculation of wholesale for craftsmen.