Markup Calculator
Calculate markup percentage, selling price, and profit from cost. Enter any two of the three values and the calculator fills in the third. See the difference between markup and margin.
What Is Markup?
Markup is the amount you add to the cost of a product to set its selling price. If a product costs you $50 and you sell it for $70, you added a $20 markup — a 40% markup on cost.
Markup is calculated from cost, margin is calculated from revenue. This is the single most common source of pricing errors. The same transaction gives two different percentages, and mixing them up undercharges or overprices your products.
Markup Formulas
Markup % = ((Selling Price − Cost) ÷ Cost) × 100
Selling Price = Cost × (1 + Markup % ÷ 100)
Profit Margin % = ((Selling Price − Cost) ÷ Selling Price) × 100
The markup amount is the same in all three formulas. Only the denominator changes — cost for markup, revenue for margin.
Markup vs Margin: The Same Sale, Two Percentages
You buy for $50, sell for $70. Profit is $20:
- Markup = $20 ÷ $50 = 40% (profit as % of cost)
- Margin = $20 ÷ $70 = 28.57% (profit as % of revenue)
If you need a 30% margin and you apply a 30% markup instead, you will undercharge. A 30% markup on $50 gives a $65 selling price — a 23% margin, not 30%. To get a 30% margin, the markup needs to be about 42.9%.
Quick Markup-to-Margin Reference
- 10% markup → 9.09% margin
- 20% markup → 16.67% margin
- 25% markup → 20.00% margin
- 33% markup → 25.00% margin
- 50% markup → 33.33% margin
- 100% markup → 50.00% margin
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 revenue. If you buy for $50 and sell for $70, your markup is 40% but your margin is 28.57%. Markup is always higher than margin for the same sale.
How do I convert markup to margin?
Margin = Markup ÷ (1 + Markup). For example, a 40% markup becomes 0.40 ÷ 1.40 = 0.2857, or 28.57% margin. This formula works for any markup percentage.
How do I convert margin to markup?
Markup = Margin ÷ (1 − Margin). For example, a 30% margin becomes 0.30 ÷ 0.70 = 0.4286, or 42.86% markup. This is the formula to use when you know the margin you need and want to set the selling price.
What is a typical markup for retail?
Keystone pricing — a 100% markup — is traditional for many retail categories, giving a 50% gross margin. Clothing often runs 100–200% markup. Electronics runs much thinner, 10–20%. Restaurants typically use 200–300% on food cost. The right markup depends on your industry, overheads, and how fast inventory moves.
Can markup be negative?
Yes. A negative markup means you are selling below cost. In retail this is a loss leader — deliberately priced low to attract customers who buy other items. But sustained negative markup on your core product is a business failure, not a strategy.
Which is more useful: markup or margin?
Markup is more useful for pricing — you start with cost and add a percentage. Margin is more useful for analysis — it lets you compare profitability across different products or businesses regardless of cost structure. Most businesses use both: markup for setting prices, margin for tracking performance.