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The Most You Should Pay: A Simple Formula

1 min read · Profit and numbers

Work backwards from the selling price to the highest buy cost that still meets your ROI target.

The formula

Maximum buy price = (selling price − fees) ÷ (1 + target ROI).

Example

Sells at $80, fees $23, target 30 percent: 57 ÷ 1.3 = about $43.85.

Why it helps

You can decide at the shelf in seconds, and you know how much room a price match would give.

Add a check

Also require a minimum dollar profit.

General information for resellers, not financial, tax or legal advice. Marketplace fees and policies change; check the current rules before you buy.

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Keep reading

Profit and numbersWhat to Track in a Reselling Spreadsheet

A simple spreadsheet shows which products and stores actually make you money.

Profit and numbersHow to Calculate ROI on a Resale Deal

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Profit and numbersROI vs Profit Margin: Which to Use

ROI compares profit with what you paid. Margin compares profit with the selling price.