Department Stores
Department Stores Gross Margin Benchmark
Gross margin measures the percentage of revenue remaining after subtracting cost of goods sold. This page provides department stores-specific ranges, drivers, and improvement tactics.
Typical Range
32–42%
Industry Average
37%
Formula
((Revenue − Cost of Goods Sold) ÷ Revenue) × 100
Why this benchmark looks like this in Department Stores
- Broad mix
- Brand vs private label tension
Industry context: Broad assortment, mall-based.
How to improve gross margin in Department Stores
- Mix shift to higher-margin categories
- Manage markdown by category
Universal drivers
- • Pricing strategy
- • Markdown discipline
- • Vendor cost negotiation
- • Mix shift toward higher-margin SKUs
- • Private label penetration
Gross Margin across other retail industries
| Industry | Range | |
|---|---|---|
| Apparel & Fashion | 50–60% | View → |
| Grocery & Supermarkets | 20–30% | View → |
| Consumer Electronics | 10–20% | View → |
| Home & Furniture | 35–50% | View → |
| Health & Beauty | 40–50% | View → |
| Luxury & Jewelry | 60–75% | View → |
| Sporting Goods | 35–45% | View → |
| Home Improvement | 30–38% | View → |
| Toys & Games | 30–42% | View → |
| Pet Supplies | 35–45% | View → |
| Auto Parts & Accessories | 40–50% | View → |
| Office Supplies | 28–38% | View → |
| Dollar & Discount Stores | 30–38% | View → |
| Footwear | 45–58% | View → |
Calculate Your Gross Margin
Gross Margin Calculator
The cleanest read on how much of every sales dollar you actually keep after paying for the goods. Gross margin drives every downstream financial decision in retail: what to price, what to promote, what to keep on the shelf. Margin percent, the markup equivalent, cost as a percent of revenue and the price-to-cost multiplier all appear together, which is what it takes to translate between the three lenses without reaching for a second tool.
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Markup Calculator
Set a selling price from cost or reverse-engineer the markup baked into an existing price. Markup is the buyer’s language of pricing (percent added on top of cost), while [margin](/calculators/retail-finance/gross-margin-calculator) is the finance language (percent kept from revenue). Alongside markup percent come profit per unit, the margin equivalent and the price-to-cost multiplier. Buying and finance can then argue about the price rather than about the denominator.
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Markdown Calculator
The pricing tool every buyer and merchandiser reaches for when inventory is running behind sell-through pace. Out comes the markdown amount, the markdown percent, the final selling price, and, once a cost is entered, the resulting gross profit and margin percent. It also flags whether the markdown depth is promotional, seasonal, aggressive or clearance-tier, and generates practical next-step recommendations tied to [gross margin](/calculators/retail-finance/gross-margin-calculator), [GMROI](/calculators/retail-finance/gmroi-calculator), [sell-through rate](/calculators/retail-finance/sell-through-rate-calculator) and [inventory turnover](/calculators/inventory-management/inventory-turnover-calculator).
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Deep-Dive Guides
Gross Margin Explained: The Retail Operator’s Guide to the Number That Runs the P&L
How buyers and finance actually work gross margin. The formula, three what-if scenarios, the margin-vs-markup translation, category benchmarks, GMROI, and the seven levers that move margin on purpose.
Gross Margin vs Markup: The Difference Every Retailer Must Know
These two numbers are not the same. Confusing them is the most common pricing mistake in retail. Here is a clear, example-driven breakdown with a conversion chart.
Explore Related Resources
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Source & methodology
Ranges are anchored to NYU Stern's Damodaran 'Margins by Sector' dataset, a public-company average updated monthly and freely available at pages.stern.nyu.edu/~adamodar. Public-company margins can run higher than private/small-business margins in the same category due to scale and pricing power. Treat these as a directional ceiling, not a target.
- NYU Stern, Damodaran 'Margins by Sector' (pages.stern.nyu.edu/~adamodar)
Benchmarks last reviewed: 2026-08-10