Margin and Markup Calculator
Work out margin, markup and profit, or the price needed for a target margin.
Margin and markup are not the same
Margin is profit as a share of the selling price. Markup is profit as a share of the cost. The same sale gives two different percentages, and mixing them up leads to underpricing.
Example
An item that costs 60 and sells for 100 has a profit of 40. The margin is 40 ÷ 100 = 40%, and the markup is 40 ÷ 60 = 66.7%.
Setting a price from a margin
To earn a 40% margin on a cost of 60, divide by 0.60 to get a price of 100. Adding 40% to the cost would give only 84, which is a margin of about 28.6%. Use the second tab whenever you are pricing to a margin target.
Frequently asked questions
Which should I use, margin or markup?
Margin is the better guide to how much of each sale you keep. Markup is handy for quickly adding a percentage to a cost.
Can margin be 100%?
No. Margin can approach 100% but never reach it, because the cost would have to be zero.
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