Markup Calculator
Calculate selling price from cost and markup percentage, and find your profit margin.
Markup vs. margin: the most common pricing confusion
Markup and margin are both expressed as percentages but are calculated differently and have very different values. Markup is the percentage added on top of cost. Margin is the percentage of the selling price that is profit. Mixing them up leads to serious pricing errors — a business targeting a 40% margin but calculating prices using a 40% markup will lose money on every sale.
Markup = (Selling price − Cost) ÷ Cost × 100
Margin = (Selling price − Cost) ÷ Selling price × 100
Example: Cost $60, Selling price $100
Markup = (100 − 60) ÷ 60 × 100 = 66.7%
Margin = (100 − 60) ÷ 100 × 100 = 40%
To achieve a target margin, use:
Selling price = Cost ÷ (1 − Target margin%/100)Markup to margin conversion table
| Markup % | Margin % | Price on $100 cost |
|---|---|---|
| 10% | 9.1% | $110 |
| 20% | 16.7% | $120 |
| 25% | 20% | $125 |
| 33.3% | 25% | $133.3 |
| 50% | 33.3% | $150 |
| 66.7% | 40% | $166.7 |
| 100% | 50% | $200 |
| 200% | 66.7% | $300 |
Typical markups by industry
Setting prices for different objectives
Pricing strategy depends on your business goals. Cost-plus pricing (cost + markup) is the simplest approach. Competitive pricing matches or undercuts market prices regardless of cost. Value-based pricing charges what the customer perceives the value to be — often the most profitable approach for unique or premium products where the markup can far exceed industry norms.
Frequently asked questions
What is the difference between markup and margin?
Markup is profit as a percentage of cost; margin is profit as a percentage of the selling price. A 50% markup equals a 33% margin.
How do I calculate selling price from cost and markup?
Multiply the cost by (1 + markup ÷ 100). A 40 cost with 50% markup sells for 40 × 1.5 = 60.
Why do markup and margin differ for the same product?
They use different bases — markup divides profit by cost, margin divides it by price. Since price is higher than cost, the margin percentage is always lower.
What markup should I use?
It varies by industry and competition. Cover all costs and desired profit, then check the resulting price against the market before settling on a markup.
Selling price = Cost × (1 + markup%/100) Gross margin = 1 − (cost ÷ selling price)