Markup and Margin Calculator
Fill in any two fields and leave the others empty. The calculator works out the rest and shows the profit. Nothing is sent anywhere.
Markup and margin are not the same number
Both describe the gap between what something costs you and what you sell it for, but they measure it against different bases. Markup is profit as a percentage of cost. Margin is profit as a percentage of the selling price. Because price is always bigger than cost when you make a profit, the margin percentage is always smaller than the markup percentage for the same sale.
Take a product that costs 80 and sells for 100. Profit is 20. Markup is 20 ÷ 80 = 25%. Margin is 20 ÷ 100 = 20%. Same sale, two different percentages. Mixing them up is one of the most common pricing mistakes in small businesses: a shop that wants a 50% margin and applies a 50% markup ends up with a 33% margin and wonders where the money went.
The formulas
With cost (C) and price (P):
- Profit = P − C
- Markup % = (P − C) ÷ C × 100
- Margin % = (P − C) ÷ P × 100
Going the other way:
- Price from markup: P = C × (1 + markup ÷ 100)
- Price from margin: P = C ÷ (1 − margin ÷ 100)
- Convert markup to margin: margin = markup ÷ (100 + markup) × 100
- Convert margin to markup: markup = margin ÷ (100 − margin) × 100
A quick reference: 25% markup is 20% margin, 50% markup is 33.3% margin, 100% markup is 50% margin, and 300% markup is 75% margin. A margin can never reach 100%, because that would mean the item cost nothing.
Which one should you use?
Use margin when you talk about the health of the business, because it relates directly to revenue: a 40% gross margin means 40 of every 100 in sales is left after direct costs. Accountants, investors and most reporting use margin. Use markup when you set prices from a cost list, because it is easier to apply: multiply cost by 1.5 for a 50% markup. Many industries have conventional markups, such as keystone (100% markup, 50% margin) in retail.
If a client or supplier quotes a percentage, always ask which one they mean. "We add 20%" is a markup. "We keep 20%" is a margin.
Frequently asked questions
Does margin here mean gross or net margin?
Gross. It only accounts for the direct cost you enter. Net margin also subtracts overheads, tax and other expenses.
Can I use this for services?
Yes. Enter your cost of delivery (your time at your internal rate plus any expenses) as the cost. Our hourly rate calculator helps you find that internal rate.
Why does it say margin must be below 100?
Margin is profit ÷ price. Profit cannot exceed price unless the cost is negative, so 100% is impossible.
Is my data stored?
No. The calculation runs entirely in your browser.