Keystone pricing: wholesale × 2 = retail. 100% markup, 50% margin. It's the default markup for most brick-and-mortar retail for a simple reason — it works.
Why 100% markup
A keystone markup produces a 50% gross margin. That's enough to cover the typical retail overhead stack: rent (10–15%), labor (10–15%), shrinkage (1–3%), marketing (3–5%), other operating costs, plus some profit. After all that, net margin lands in the 5–10% range.
Where keystone breaks
- High-ticket items — keystone on a $1,000 wholesale item is $2,000. Customers balk. Discount retailers run 20–40% markups instead.
- Commodity categories — grocery, gas, hardware. Competition has ground margins below 50% long ago.
- Low-price anchors — $4.99 items don't have room for keystone off fair wholesale.
- E-commerce — price comparison pressure means 25–40% is often the real ceiling.
Where keystone still rules
- Apparel — often keystone or higher (triple keystone = 200% markup).
- Gift and specialty retail.
- Furniture (though online retailers have squeezed this).
- Jewelry — often 2–3× keystone (triple markup).
- Tourist markets — built to support high markup.
// TRY THE TOOL
PRICE KEYSTONE.
Enter cost, pick 100% markup. Get the keystone selling price and equivalent margin.
OPEN →