What is the term for the difference between merchandise cost and selling price?

The term that describes the difference between the cost of merchandise and its selling price is known as markup. Markup represents the amount added to the cost of a product to establish its selling price, reflecting the profit margin that a retailer or manufacturer seeks to achieve. This financial concept is fundamental in retail and pricing strategies, as it allows businesses to cover their costs and generate profit. Understanding markup helps businesses to set competitive pricing while ensuring they operate profitably.

Other terms like rebate or quantity discount refer to varying pricing strategies or promotional offers but do not directly relate to the calculation of profit margin based on cost and price. A rebate typically involves a partial refund after purchase, and a quantity discount offers a price reduction for bulk purchases, neither of which directly pertains to the calculation of markup. The word "Bier" does not have a relevant meaning in this context.