Retailers generally have low profit margins due to the nature of their businesses. Online retailers tend to have higher profit margins than traditional retailers. Vend found that the average gross profit margin for retailers is 53.33%. Those with higher margins included beverage, jewelry and cosmetic manufacturers (up to more than 65 percent), while alcoholic beverages, sporting goods stores, and electronics were lower (just over 35 percent).
The Pre-Tax Benefit for Retailers in the U.S. In the US, it is usually around 3% to 5% of revenues. Some retailers perform better and others offer lower profits, and it varies widely between different types of retail segments. We've found that specialty retailers tend to offer higher profit margins.
The data reveals that the average gross profit margin varies by industry. Of this sample, supermarkets and grocery stores and beer, wine and liquor retailers are the lowest at 28.8 and 26.3 percent, respectively. Women's clothing and furniture stores are in the high-end with 46.5 and 45.0 percent, respectively. As more and more online shopping shifts take place, retailers work hard to capture the sale, no matter the cost.
But when it comes to profitability, an online sale isn't an equivalent replacement for that same store-bought item. Apparel Magazine published its annual report of the top 50 clothing brands with the highest overall profit margin. Since retail stores serve a wide range of consumers, profit margins vary wildly. But if you're trying to assess whether the brick-and-mortar store is a profitable retail business idea, the net profit typically ranges from 0.5 to 0.75%.
