Product costing and margins: price it right before launch
Published by Cydney MarLast updated
To price a consumer product, calculate its full landed cost first, then check that your selling price leaves a gross margin that still covers channel costs, returns and reorders.
Cost and margins is the fourth stage of Cydney Mar's Concept-to-Reality Pathway, where founders build for real profit and scalability and learn to calculate costs properly. Airtime Ready includes a simple worksheet below so you can check gross margin from your own figures before talking to a channel, retailer or factory.
How do I calculate my product's margin?
Subtract landed cost per unit from your selling price, then divide by the selling price. If a product sells for 40 and lands for 12, gross profit is 28 per unit and gross margin is 70 percent. Channel fees, customer shipping, returns and marketing then come out of that gross profit.
Definition
What is landed cost?
Landed cost is the full cost of getting one finished unit of your product to your warehouse or to the channel. It starts with the factory price and adds materials you supply, packaging and labels, freight, duties and taxes, insurance and any handling or inspection fees. It does not yet include the costs of selling, such as channel terms, platform fees, customer shipping, returns or marketing. Those come next. On Airtime Ready, landed cost is the number every pricing decision starts from, because pricing from the factory price alone is one of the most common ways founders end up with a product that sells but does not make money. Cydney Mar’s pathway places costing before production readiness for exactly that reason.
By the numbers
Cydney Mar's track record in numbers
- years in fashion and product
- 45+
- in global retail, TV and DTC sales
- $300M+
- years selling her own collections on QVC
- 15+
- hours of live television
- 800+
- countries on air
- 8
- stages in the Concept-to-Reality Pathway
- 6
Figures as published by Cydney Mar on cydneymar.com, as of November 2026. These are her own career figures, not an independent audit.
Comparison
Cost lines to include, by channel
| Cost line | TV shopping | D2C | Retail |
|---|---|---|---|
| Factory price, freight, duties | Yes | Yes | Yes |
| Packaging and labels | Yes | Yes | Yes |
| Channel or retailer terms | Per channel agreement | Platform and payment fees | Retailer margin |
| Shipping to customer | Per channel terms | Usually you | Usually the retailer |
| Returns | Per channel terms | You | Per retailer terms |
| Marketing | Airing preparation and samples | Ads and content | In-store support, if any |
Step by step
How to cost a consumer product
Get factory quotes from your tech pack
Comparable quotes need the same complete specification.
Add every landing cost
Freight, duties, insurance, packaging, labels and handling.
Add channel costs
Channel terms or platform fees, customer shipping and expected returns.
Check margin at your target price
Use the worksheet below and compare against your target.
Adjust before production
Change materials, packaging or order quantity while it is still cheap to do so.
Worksheet
Gross margin worksheet
Enter your own figures in any currency. Commas and a leading $ sign are accepted.
Margin and markup are not the same
Margin is profit as a share of the selling price. Markup is profit as a share of cost. A product costing 12 and selling for 40 has a 70 percent gross margin but a 233 percent markup. Mixing the two up leads to underpricing.
When thin margins show up
Thin margins discovered at production leave few options. Discovered during development, they can be fixed through materials, packaging, quantity or features. That timing is the reason costing sits before production readiness in Cydney Mar’s pathway.
FAQ
Common questions
- What is a good margin for a TV shopping or D2C product?
- There is no single right number, because channel terms, returns, shipping and marketing costs differ. What matters is that your price covers landed cost plus every channel cost, with room left for profit and reorders. Cydney Mar's pathway includes learning to calculate costs properly so the product is built for real profit and scalability.
- What is landed cost?
- Landed cost is the full cost of getting one finished unit to your warehouse: the factory price plus materials, packaging, freight, duties, insurance and handling fees. Pricing from the factory price alone is one of the most common margin mistakes, so calculate landed cost before you set a retail price or quote a channel.
- When should I set my retail price?
- Set a target price early, during product clarity, then confirm it after costing. Designing to a target price keeps materials and features in line with what buyers will pay. Waiting until production quotes arrive often leaves founders choosing between a price that is too high and a margin that is too thin.
- My margins are too thin. How can I fix them?
- Recalculate landed cost first, then look at materials, packaging, order quantity and features that do not change what buyers value. Raising the price is an option only if the product supports it. Building cost and margins into development, as Cydney Mar's pathway does, prevents most of these surprises from appearing at production.
- How much does a product development consultant cost?
- Prices vary by scope, and Cydney Mar does not publish her rates on her website. Engagements can range from a single strategy call to a full collection program. The fastest way to get a real figure is to describe your product and goals through the contact page on cydneymar.com and ask which options fit.
- Can product development costs be covered by grants?
- Sometimes. On her page for CCIB members, Cydney Mar notes that deeper support, such as business plans, cost structures, tech packs and sourcing, is often grant-eligible, and she prepares business plans and cost structures for grant and funding applications. Eligibility depends on each program, so confirm the rules with the funder directly.
Keep reading
Related guides
Ready to take your product from concept to reality?
Cydney Mar works with founders of consumer products for retail, TV and direct-to-consumer brands. Tell her about your idea and where you are stuck.