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Markup & Margin Calculator

Convert markup into price, profit and margin.

How it is calculated

Markup is the percentage added on top of cost: price = cost × (1 + markup / 100). Profit is price − cost. Margin is profit as a share of the selling price: margin = profit / price × 100. The two are different measures, so the same profit gives a markup that is always larger than the margin.

Cost must be above zero and the markup cannot be negative. The money amounts use the currency shown and the margin has two decimals. The calculation is per unit and does not include tax, shipping, discounts or other overheads, so enter a fully loaded unit cost if you want a realistic margin.

Worked example

Unit cost 40 and markup 50%. Price = 40 × (1 + 0.50) = 60. Profit = 60 − 40 = 20. Margin = 20 / 60 × 100 = 33.33%. The tool shows a selling price of $60.00, profit of $20.00 and a margin of 33.33%. A 50% markup is therefore only a one-third margin.

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Common mistakes

  • Treating markup and margin as the same number: a 50% markup gives a 33.33% margin, not 50%.
  • Targeting a margin by entering it as the markup, such as adding 30% to get a 30% margin; it takes a 42.86% markup.
  • Using the price-based margin to figure the cost-based markup in a quote, and the reverse.
  • Leaving out shipping, fees and returns from the unit cost, which overstates the margin.

Sources

About this calculator

This calculator converts a markup percentage into selling price, profit, and profit margin, clarifying a distinction that trips up a lot of business owners: markup is profit expressed as a percentage of cost (price = cost × (1 + markup%)), while margin is that same profit expressed as a percentage of the selling price (margin% = profit ÷ price × 100). Because the two use different denominators, the same dollar profit produces a markup percentage that's always higher than the margin percentage — a 100% markup, for example, corresponds to only a 50% margin.

Retailers and small business owners use it to set prices that hit a target margin rather than guessing from markup alone; accountants and bookkeepers use it to reconcile pricing sheets with profitability reports; and e-commerce sellers use it to price products consistently across a catalog while protecting margin against fees and discounts.

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  • Editorial team

    Pricing often starts from the margin you want, not the markup. To go that way, divide the margin by one minus the margin: a 40 percent margin needs a markup of 66.67 percent, so a unit costing 60 sells at 100 with a profit of 40. Enter 66.67 here and the margin line should read about 40.00 percent as a check. What margin are you aiming for in your line of business?

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