Parts markup matrix calculator
Works out what a part sells for under a parts matrix, and the margin the matrix makes across a shop's mix of parts.
- Example: a sliding scale
- Example: a steeper scale, for a shop that sells many cheap parts
- Example: a flat markup, for comparison
The example matrices are illustrations made for this page, not survey results, and no matrix here is a recommendation. The right matrix is the one that produces the margin a shop needs on its own mix of parts, which is what the share column shows.
Result
This is the result of the example in the form.
| Row | Cost of the part | Markup | Margin | Sample cost | Sells for | Profit | Share of spend |
|---|---|---|---|---|---|---|---|
| 1 | $0.00 to $5.00 | 150% | 60% | $5.00 | $12.50 | $7.50 | 5% |
| 2 | $5.01 to $25.00 | 100% | 50% | $25.00 | $50.00 | $25.00 | 20% |
| 3 | $25.01 to $100.00 | 80% | 44.444% | $100.00 | $180.00 | $80.00 | 35% |
| 4 | $100.01 to $250.00 | 60% | 37.5% | $250.00 | $400.00 | $150.00 | 25% |
| 5 | $250.01 to $500.00 | 50% | 33.333% | $500.00 | $750.00 | $250.00 | 10% |
| 6 | $500.01 and up | 40% | 28.571% | $1,000.00 | $1,400.00 | $400.00 | 5% |
Row 6 is the last row used, so it has no upper limit: a part that costs $500.01 or more is priced by it, whatever its "cost up to" says.
A part that costs $42.50 is in row 3. It sells for $76.50, a profit of $34.00.
Blended margin: 43.662%. That is inside the typical range of 40% to 50% for parts gross profit. The usual target is 50%.
These figures are for a general repair shop. A tire shop or a heavy-duty shop runs different numbers. The range is given as typical by WickedFile, and the usual target as what shops aim for by Elite Worldwide. Neither is a survey of what shops earn.
A margin of 50% is a markup of 100%: to make the usual parts target with one markup on every part, that is the markup it takes.
How this is worked out
Markup is profit as a percent of cost. Margin is profit as a percent of the selling price. The same part has both, and the margin is always the smaller number.
With a markup: price = cost × (1 + markup). With a margin: price = cost ÷ (1 − margin). The price is rounded to the nearest cent, and the profit is the price less the cost.
margin = markup ÷ (1 + markup), and markup = margin ÷ (1 − margin). A margin of 100% or more has no price, so it is refused.
A part belongs to the first row whose "cost up to" is at or above its cost. A part that costs more than every row belongs to the last row.
Blended margin = total profit ÷ total sales. With a share s of parts spend and a markup m in each row, sales are the sum of s × (1 + m) and profit is the sum of s × m. A row with no share counts as none, and the shares must add to 100%.
This is arithmetic, not accounting or tax advice.
Wenmar Pro applies a parts matrix to every estimate.