The recommended retail price a manufacturer suggests a merchant sell their finished product for.
RRP (Recommended Retail Price) is the suggested price at which a brand should list and sell a product to the end-consumer. Setting an optimal RRP is a critical strategic decision that balances product cost (COGS), competitor pricing, customer demographics, and brand positioning. In D2C apparel, the RRP must be calculated to cover the complete Cost of Goods Sold (including the base product, print cost, packaging, and shipping), digital customer acquisition advertising costs (CAC), and transaction fees, while yielding a sustainable net profit margin. For example, a basic t-shirt might have a COGS of ₹450 and be priced at an RRP of ₹799 (generating a modest gross profit of ₹349). In contrast, a heavyweight 240 GSM oversized streetwear t-shirt with a premium front-and-back print might have a COGS of ₹610 but command a premium RRP of ₹1,499 to ₹1,899, due to the high perceived value of the heavy structured drape and streetwear aesthetic, resulting in a vastly superior gross profit margin.