BTW ... roamn ... your method to deduct the VAT is wrong ...

If you have 20% VAT, then the shop price is 100% price + 20% VAT, so you cannot simply deduct 20%.

Shop Price = 30$ = 120%

So if 120% are 30$,

then 100% are 30/120*100 = 25$.

Also, the deducting order is wrong.

The shops have to sell it including VAT, so this one ist last.

Then comes the shops margin.

The publisher sets a reseller price, and everything above this reseller price goes to the shop.

Remember that only the last one in the chain has to pay VAT, so you pay VAT to the shop, who manages it. The shop gets the product without VAT.

Publishers have to take quite a big share of the remainder, for they have to pay a lot of things, like:

- producing the medium

- designing and producing the packaging

- free giveaway copies for press and other reviews

- advertisement in general

so ... normaly you build it up like this:

Say, the designer takes 2000$ for designing and printing the package.

You plan on releasing 1000 copies, so every copy is $2 for packaging alone.

The CD has to be produced, at 1000 Copies, you pay around 1$ per copy + about 300 for the glass master. So every CD is 1,3 $ in production

Then, you need a handbook, however short it may be. Say, we do four pages, for a design and printing price of about 400 $. That's another 0,4$ per copy.

So after producing our Game, we have costs of about 3,7$ per game, make it 4 for shipping, shrink-wrapping etc.

Next, the publisher does advertisement in different magazines, at least, if he knows his job. So he spends another 5000 $ on ads etc. This is another $5 per cd.

Next up are free copies. Free copies do not generate income for the publisher, so they have to be made up with the other copies. Say, our publisher plans on giving away 50 copies, then he can only sell 950 copies. We hat 9$ per cd so far, now we give away 50 copies, which makes us "loose" 450$, or 0,45$ per cd.

So the prise rided to 9,45$ without any profit by now. Make it 10 for handling etc.

Next up is the publishers and the producers profit.

If the producer got a fixed sum, make it 2000$, you have to divide this by 950 copies remaining, which brings us to about 2,1$ per copy. If the producer get additional pay per copy, add it here. Say, he gets 40c per copy, then we have 2,5 $ per copy which doesn't go to the publisher.

So our copy is at 12,5$ now, still without profit for the publisher.

The publisher has to run his business, pay it's employees etc, so he adds another 3$ for his fixed costs (the price per cd is "variable costs").

So, if he sets the reseller price to 22$, which means he earns 6,5$ per copy.

The Shop adds another 3$ for his own profit, bringing us to 25$.

Now include the VAT and there are the 30$ you set as example.

I'm not good at explaining this stuff in english ... hope you understand.