Right, so companies sell at cost. Right?
Did you perchance not make it into high school?
Most retail prices by margin. What this means, is they select a gross margin they need returned, then apply it to an item to determine the cost.
So if I have a pencil and I need a 1.2% margin, then I look at my costs.
Acquisition or material cost = $.35
Amortized Overhead = 25%
Margin = 1.2%
.35*126.2=44.17 rounded to 44 cents.
Almost all retail sells at fixed margin.
And yes, 1 to 3% margin IS the average for consumer retail.