Retail math · By role
Retail Math for Merchandisers in Apparel
Initial markup, maintained markup, markdown, allowances, and category mix — the margin math the merchandising team owns.
20 formulas for merchandisers
InventoryAlso: Planner
Open-to-Buy (OTB)
OTB = Planned Sales + Planned EOP + Planned Markdowns − Planned BOP − Receipts on Order
Margin
Initial Markup % (IMU)
IMU % = (Retail Price − Cost) ÷ Retail Price × 100
Margin
Maintained Markup % (MMU)
MMU % = (Net Sales − COGS) ÷ Net Sales × 100
ProductivityAlso: Analytics
Sell-Through Rate
Sell-Through % = Units Sold ÷ Units Received × 100
ProductivityAlso: Executive
Gross Margin Return on Investment (GMROI)
GMROI = Gross Margin $ ÷ Average Inventory at Cost
Margin
Markdown %
Markdown % = Markdown $ ÷ Net Sales × 100
MarginAlso: Designer / Product Dev
Target Costing
Target Cost = Retail Price × (1 − Target IMU %)
InventoryAlso: Designer / Product Dev
Total Line Count (Styles × Colors)
Total SKUs = Styles × Colors × Sizes
MarginAlso: Designer / Product Dev
Cost-to-Ticket Ratio
Cost-to-Ticket = Cost ÷ Retail Price
InventoryAlso: Designer / Product Dev
Style-Color Depth
Units per Style-Color = Total Buy Units ÷ (Styles × Colors)
Margin
Gross Margin %
Gross Margin % = (Net Sales − COGS) ÷ Net Sales × 100
Margin
Allowances %
Allowances % = (Markdowns + Discounts + Chargebacks) ÷ Gross Sales × 100
Sales
Category Mix %
Category Mix % = Category Sales ÷ Total Sales × 100
SalesAlso: Buyer
Average Unit Cost (AUC)
AUC = COGS ÷ Units Sold (or Inventory at Cost ÷ Units On Hand)
SalesAlso: Analytics
Average Unit Retail (AUR)
AUR = Net Sales ÷ Units Sold
SalesAlso: Analytics
Average Dollar Sales (ADS) per Transaction
ADS = Net Sales ÷ Number of Transactions
SalesAlso: Analytics
Units per Transaction (UPT)
UPT = Units Sold ÷ Number of Transactions
SalesAlso: Analytics
Return Rate %
Return Rate % = Return Units ÷ Gross Sales Units × 100
MarginAlso: Executive
EBITDA Impact of Markdown
EBITDA Hit = Incremental Markdown $ × (1 − Tax Shield)
SalesAlso: Executive
Gross-to-Net Sales
Net Sales = Gross Sales − Returns − Allowances
Merchandiser Cheatsheet
Retail Math Cheatsheet for Merchandisers
A role-specific PDF with the formulas merchandisers use day-to-day — equations, worked apparel examples, and the adjacent formulas you work with. Work email only — no sales calls triggered.
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Merchandisers run this math in RetailNorthstar — live.
One connected system from plan to allocation. No more reconciling the spreadsheet, the BI dashboard, and the buy file against each other.