Costs and margins
Last updated: Published by Cydney Mar
Show product costs as a per-unit landed cost, a margin for each launch channel and a separate list of one-off development costs, each backed by a supplier quote. The Funding File, published by Cydney Mar, sets out that structure below, with a worksheet to check your per-unit margin before you apply.
Cost and margins are a full stage of Cydney Mar's Concept-to-Reality Pathway: build for real profit and scalability, and learn to calculate costs properly, before committing to production.
A cost structure has two halves. Per-unit costs tell a reviewer whether each sale makes money. One-off and fixed costs tell them how much you need before the first sale, and that is usually what a grant or loan pays for.
| Cost line | What it includes | Evidence funders expect |
|---|---|---|
| Factory cost | Materials, labour and the factory’s margin per unit | Written supplier quote at your order quantity |
| Packaging | Retail box, inserts, labels, swing tags | Packaging supplier quote |
| Freight and duty | Shipping, customs duty, brokerage and fees to your warehouse | Freight estimate and duty classification |
| Channel share | What the retailer or TV partner keeps, or your own selling, payment and fulfilment costs | Partner terms or your own cost estimates |
| One-off costs | Samples, tooling, tech pack, testing, certification | Quotes and invoices for each item |
| Fixed costs | Marketing, software, salaries, rent | Budget with the basis for each figure |
Run the worksheet once for each launch channel. A price that works direct-to-consumer may not leave enough once a retailer or TV partner takes its share. Commas, a currency sign and spaces are accepted.
Enter all five figures and select Calculate margin. Results appear here once every figure is valid.
Assumptions
Landed cost = factory cost + packaging + freight and duty. Channel share = selling price × share %. Gross profit = selling price − channel share − landed cost. Gross margin = gross profit ÷ selling price. Figures are per unit, in one currency, before fixed costs and taxes.
This is an estimate to help you prepare, not a financial, legal or eligibility decision.
Finalize materials, measurements and finishes in a tech pack, so every supplier quotes on exactly the same product.
Ask each supplier for unit prices at two or three quantities, plus sample costs, minimum order quantities and lead times.
Add factory cost, packaging, freight, duties and fees for one unit delivered to your warehouse.
Subtract each channel’s share of the selling price, whether retail, TV or your own direct-to-consumer costs, to see the margin left.
Samples, tooling, tech packs, testing and certification belong in their own table, usually the part a development grant pays for.
Where the program allows it, add a clearly named contingency line so a slip in samples or freight does not sink the budget.
On The Funding File, landed cost means the full cost of one finished unit delivered to your warehouse: factory cost, packaging, freight, duties and fees. It is the number every margin calculation starts from. Leaving out freight or duty is one of the most common reasons a product that looked profitable on paper loses money once it ships.
A cost structure is the breakdown of what it costs to make, ship and sell one unit of your product, plus the fixed costs of running the business. Funders use it to check that your price covers your costs with room for profit. Cydney Mar builds cost structures strong enough for grant and funding applications.
Add every cost that goes into one finished unit: materials, labour, the factory’s margin, packaging, freight, duties and any fees to get it to your warehouse. That total is your landed cost. Spread one-off costs such as tooling or samples across the first production run separately. The worksheet on the cost structure page walks through the per-unit math.
There is no single number; the margin you need depends on the channel. Retailers and TV shopping partners keep a share of the selling price, while direct-to-consumer sales carry website, payment, fulfilment and advertising costs. Build a separate margin line for each channel in your plan and confirm the partner’s terms before you commit to a price.
A tech pack is the technical document that tells a factory exactly how to make your product: materials, measurements, construction and finishing. Funders rarely ask for one directly, but it makes your cost quotes credible. Cydney Mar describes a clear tech pack as the difference between a sample that is right the first time and months of back-and-forth.
Send each supplier the same specification, ideally a tech pack, and ask for unit pricing at two or three quantities, sample costs, minimum order quantities and lead times. Matching specifications let you compare quotes fairly and give funders evidence for each budget line. Cydney Mar’s pathway includes vetting suppliers for quality, communication and reliability.
Yes, if the program allows it. Samples get revised, freight costs move and launches slip: Product Fruits’ 2026 launch framework says 45% of launches slip by at least a month, and that delayed ones are markedly more likely to miss their targets. A clearly labelled contingency line shows a reviewer you understand the risk.
Cydney Mar prepares business plans and cost structures strong enough for grant and funding applications, alongside hands-on product development. Start with a strategy call to talk through your idea and map clear next steps.
Published by Cydney Mar