Methodology & Disclaimers
Last updated: July 6, 2026
Every number on this site is an estimate. This page explains exactly how figures are produced, how confident we are in them, and how they should — and should not — be used. This disclaimer standard applies to every ranking, statistic, award, widget, and report we publish.
1. The Idiot Index
The Idiot Index, popularized by Elon Musk, is the ratio between a product's selling price and the estimated cost of its raw materials and components:
Idiot Index = Retail Price ÷ Estimated Bill-of-Materials Cost
A high index suggests the price sits far above the underlying materials; a low index suggests a tightly competitive market. The index intentionally excludes many real costs — R&D, labor, tooling, regulatory compliance, distribution, marketing, warranty, and margin structures across the supply chain — so a high index is not evidence of wrongdoing or price gouging. Pharmaceuticals, for example, carry enormous R&D and regulatory costs that a materials-only ratio cannot capture.
2. How estimates are produced
Bill-of-materials estimates combine: published teardown analyses and component pricing where available; commodity material prices; AI-assisted research that decomposes products into major components with cited assumptions; and community contributions reviewed through our moderation queue. Retail prices reflect typical listed prices at the time of research, in USD, and may lag market changes.
3. Confidence indicators
| Level | Meaning |
|---|---|
| High | Based on published teardowns or verified component pricing for the specific product |
| Medium | Based on analogous products, category norms, or partially verified component data |
| Low | Primarily model-estimated; treat as an order-of-magnitude indication only |
4. Standard disclaimer for all published figures
Unless explicitly marked otherwise, every figure on this site — including product pages, rankings, awards, share cards, embeddable widgets, API responses, and benchmark reports — carries this standard disclaimer:
All figures are estimates for informational and educational purposes. They are not statements of any company's actual costs or margins, not financial advice, and not suitable for investment, valuation, procurement, or legal decisions. Estimates exclude R&D, labor, tooling, compliance, logistics, and other real costs.
5. Corrections
Manufacturers and rights holders may submit corrections with supporting evidence to [email protected]. Substantiated corrections are prioritized in the review queue and applied with a public change note.
6. Citing our data
You may cite our statistics with attribution to "Markup Index (markupindex.com)" and a link to the source page. Embeddable widgets include attribution automatically.