I sell perfume and oud in small decant bottles; how do I calculate the margin per bottle?
Divide the full bottle's price by its millilitres to get cost per ml, multiply by the decant size, then add the empty bottle, label and packaging. That total is the cost you enter in the calculator against the decant's price.
Step one: cost per millilitre
You bought a 100 ml bottle of perfume for 320 to decant. Cost per ml is 320 ÷ 100 = 3.2. Every size you sell is built on this figure.
Step two: the full cost of one decant
The perfume is not the whole cost. A decant needs an empty atomiser, a label and perhaps a pouch or small box. That is a roughly fixed cost per bottle whatever the size, and that is where the surprise lies.
10 ml decant: perfume 32 + bottle and label 4 = 36. Sells for 65.
In the Profit margin calculator: profit 29, margin 44.62%.
3 ml decant: perfume 9.6 + bottle and label 3.5 = 13.1. Sells for 25.
Result: profit 11.90, margin 47.60%.
On the small decant the empty bottle is more than a quarter of the cost, against roughly 11% on the 10 ml. So if you cut the small size's price hard to attract people who want to try a scent, the margin collapses faster than you expect.
Allow for loss
You rarely get a full 100 ml out of a 100 ml bottle. Some stays at the bottom, some is lost while filling, and you may use a little for customer samples. If you actually get 95 ml you can sell, the real cost per ml is 320 ÷ 95, about 3.37.
10 ml decant at the corrected cost: perfume 33.68 + bottle 4 = 37.68.
At 65: profit 27.32, margin 42.03%.
About two and a half points of margin lost to waste alone. Measure your real loss over two or three bottles and use it in every calculation after that.
Compare sizes before you set their prices
- Work out the margin for every size you sell, not just one. Small sizes usually need a higher price per ml to hold their margin.
- If you can buy the same perfume from two sources in different sizes and prices, find which is cheaper per ml with the Unit-price comparison before you calculate.
- Oud and heavy oils may sell by the tola or the gram. The method is the same: unit cost times quantity, plus the bottle.
Common questions
Do I count the whole bottle's cost if I have not sold every decant yet?
Cost each decant as shown. The money tied up in the bottle until you sell it all is a cash-flow matter, not an extra cost per decant.
Does the atomiser go into the decant's cost?
Yes, everything that leaves with the decant to the customer is part of its cost.