Markup Calculator
Fill in any two fields — the third calculates automatically.
Markup %
—
Margin %
—
Profit
—
Related Tools
What is Markup?
Markup is the percentage you add to your cost price to arrive at a selling price. It is always calculated as a percentage of cost. A 100% markup means you doubled your cost. Markup is how retailers and wholesalers think about pricing — "I paid $50, I'll mark it up 80% and sell for $90."
Markup vs. Margin — The Key Difference
These two terms are often confused because both involve profit, but they use different bases:
Because the denominator differs, a 50% markup yields only a 33.3% margin. Always confirm which measure a business partner is quoting you.
Example
You source a product for $40 and sell it for $60.
- Profit: $60 − $40 = $20
- Markup: $20 ÷ $40 × 100 = 50%
- Margin: $20 ÷ $60 × 100 = 33.33%
Tips for Pricing
- Use margin when talking to investors or analyzing profitability — it shows how much of each sale is profit.
- Use markup when setting prices from cost — it's more intuitive for purchasing and procurement.
- Factor in all costs (shipping, storage, returns) before applying markup, or your actual margin will be lower than expected.
- High-volume, low-margin businesses (grocery) work differently than low-volume, high-margin ones (jewelry). Know your industry benchmarks.
Frequently Asked Questions
What is the difference between markup and margin?
Markup is the percentage added to cost to get the selling price (profit ÷ cost × 100). Margin is the percentage of the selling price that is profit (profit ÷ price × 100). A 50% markup does NOT equal a 50% margin. If you buy for $100 and add a 50% markup, you sell for $150 — but the margin is only 33.3% because the $50 profit is 33.3% of the $150 selling price.
How do I calculate selling price from cost and markup?
Selling price = Cost × (1 + Markup% / 100). Example: if your cost is $80 and you want a 25% markup, the selling price is $80 × 1.25 = $100.
What is a good markup percentage?
It depends heavily on the industry. Retail clothing often uses 100–300% markup. Grocery stores average 10–15%. Electronics typically 10–30%. Restaurants mark up food items 200–300% from food cost. A good markup is one that covers all overhead expenses and leaves a healthy profit.
How do I convert markup to margin?
Margin = Markup / (1 + Markup). For example, a 50% markup equals a 33.3% margin: 0.50 / (1 + 0.50) = 0.333. Conversely, Markup = Margin / (1 − Margin). A 33.3% margin equals a 50% markup: 0.333 / (1 − 0.333) = 0.50.