What margin should an Australian fashion brand actually make?
Intake margin, achieved margin and the number your accountant sees are three different things. Here is the one to plan against.
There are three margin numbers, and most brands only track one. Intake margin is what you make at full price. Achieved margin is what is left after markdown, returns and promotions. The gross margin your accountant reports is the year-end average of everything that happened.
As a working rule for a brand that discounts in a normal seasonal pattern, an intake margin below 55% leaves very little room. A 20% average discount on a 55% intake margin can pull achieved margin under a sustainable level once freight variation and returns are counted.
Plan against intake margin and stress-test it against your real discount rate. If a style cannot reach a healthy intake margin, the fix is usually a lower cost or a tighter range, not a higher price on a product the market has already priced.
The eight-point move on a $15M category described in the case studies came from shortening the supply chain, not from raising prices. That is almost always the more durable lever.
Find out what your product really costs, then price it so the business survives.
Most brands calculate cost price and forget freight, duty, sampling, returns and the discount they always end up giving. Prox rebuilds the number properly, sets the retail price against it, and tells you what has to change.
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