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Markup calculator: how it works
Markup = (price − cost) ÷ cost × 100. Selling for $70 something that costs $50 is a $20 markup, or 40%.
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Markup vs margin
Markup is profit as a share of cost; margin is the same profit as a share of price. Since price is always bigger than cost, the margin is always the smaller number. Quoting a markup when someone expects a margin is one of the most common pricing errors.
| Markup | Margin | Price on a $100 cost |
|---|---|---|
| 10% | 9.09% | $110 |
| 25% | 20% | $125 |
| 33.33% | 25% | $133.33 |
| 50% | 33.33% | $150 |
| 100% | 50% | $200 |
| 200% | 66.67% | $300 |
How to use the markup calculator
- Choose whether to find the price or the markup.
- Pick the currency and enter the cost.
- Enter the markup percentage, or the selling price.
- Read the price, the markup amount and the margin.
Setting a markup
Start from your costs: the markup has to cover overheads as well as profit. A business with overheads equal to 20% of sales and a 10% profit goal needs a 30% margin, which is a 42.9% markup on cost. Trades often quote a standard markup on materials (for example 15–25%) and charge labour separately.
Questions people ask
How do I calculate markup?
Markup = (price − cost) ÷ cost × 100. Selling for $70 something that costs $50 is a $20 markup, or 40%.
How do I add a markup to a cost?
Multiply the cost by 1 plus the markup. A 40% markup on $50 is $50 × 1.4 = $70.
Is a 50% markup a 50% margin?
No. A 50% markup is a 33.3% margin: on a $100 cost, the price is $150 and the $50 profit is a third of the price. A 50% margin needs a 100% markup.
How do I convert markup to margin?
Margin = markup ÷ (100 + markup) × 100. Markup = margin ÷ (100 − margin) × 100.