Guide · reviewed October 2026

What is IMU?

Plan the discount before it plans you.

IMU (initial markup) is the margin built into your full prices before markdowns, discounts and shrink. Set it higher than the margin you want to end with, because reductions take some back.

The formula

Worked example

You want to keep 55% and expect 15% in reductions:

A 61% IMU is about a 156% markup on cost.

Worth knowing

• Reductions include markdowns, promo codes, employee discounts and shrink (lost or damaged stock).
• Buyers at stores often plan by IMU, so it helps to speak their language.

Common mistakes

• Pricing to your target margin and forgetting that discounts will come.
• Mixing up IMU (a margin) with markup on cost.

Questions

Is IMU a margin or a markup?

Despite the name, IMU is usually calculated as a margin: a share of the full retail price.

What's the difference between IMU and maintained margin?

IMU is planned at full price. Maintained margin is what you actually keep after the reductions happen.

Does OptiSKU calculate IMU?

Yes. The Price tab shows margin at full price (IMU) next to your margin after fees and expected discounts.

Sources

• Mathematics for Retail Buying (Fairchild Books) · Bette K. Tepper and Newton E. Godnick
  The standard textbook for retail math: markup, margin, IMU, markdowns and open-to-buy.

Checked October 2026. Rates and rules change; confirm duty and tariffs with a licensed customs broker. All sources

Related guides