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What was the typical profit margin of early 1980s’ microcomputer resellers in a sell to a regular customer, assuming the customer paid the suggested retail price?

I'm curious about the factory prices to resellers and the approximate profit margin of resellers. All we see in magazine ads is the final price.

My interest in mainly in Apple, Atari, Commodore and IBM PC. but if you have knowledge of other computer in the theme it will be helpful. Thanks!

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    Depends on the product. On "low-margin home computers", retailers competed based on "cutthroat" pricing. On "high margin professional computers", retailers competed based on their service and support after the sale.
    – Brian H
    Feb 26 at 14:43
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    Some perspective may be found at retrocomputing.stackexchange.com/questions/13705/…
    – Jim Nelson
    Feb 27 at 2:21
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    Only one datapoint and slightly outside your time frame, but my standard margin in 1991-2000 was 25% on Amigas and PCs (including name brands and 'OEM' machines that we made up from parts). Compaq's recommended margin was 10%, which was ridiculous. I have no idea what the factory prices were, since we didn't deal with them directly. Feb 27 at 3:12
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    There was an oft repeated claim that the Apple I had a recommended retail price of $666.66 because it was sold to retailers for $500 and at the time a mark-up of one third was normal, but it seems now to survive only on very conspiracy-minded websites that I don't care to link to. I also haven't been able to verify the veracity of the one-third claim.
    – Tommy
    Mar 1 at 20:46

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One range of numbers I have seen is that the ratio of manufacturing cost to retail price of early personal computer equipment was 3 to 5. Companies like Commodore and Tandy that tried to run very lean and compete hard on price would be closer to 3x, whereas Apple would tend toward 4x or 5x.

For example, the omission of lowercase capability from the first version of the TRS-80, saved a static RAM chip. It is said that this saved $1.50 from the manufacturing cost, and $5 from the retail price.

Note that's the ratio of manufacturing cost to retail price. Wholesale price would be in between.

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    That may be misleading; if the static RAM costs $1.50 then there’s still the incremental cost of the PCB (which was more or less charged per hole in those days), fitment, any glue logic, decoupling capacitor and so on. I’d be cautious about extrapolating from it.
    – Frog
    Mar 6 at 1:51
  • When you're saying manufacturing cost you seem to be ignoring development cost entirely - which took a big share from the overall margin.
    – tofro
    Mar 6 at 7:09
  • @tofro Yes, that's why I was careful to specify manufacturing cost. Development cost was, as you say, important, but the variables were quite different; the most important variable in the per-unit development cost of a particular machine was how many units you ended up selling; equally important in the overall budget was what percentage of development projects led to salable products.
    – rwallace
    Mar 7 at 16:20
  • In fact, if you ignore development cost, you cannot possibly end up with profit which is what the question asks for.
    – tofro
    Mar 7 at 18:07
  • @tofro You're thinking of net profit. The question didn't specify which measure, but the wording strongly implied gross profit, which is what I discussed.
    – rwallace
    Mar 8 at 6:40

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