Markup vs Margin
Convert between markup percentage and profit margin for a product.
About Markup vs Margin
Markup is profit relative to cost, while margin is profit relative to the selling price, so a 50% markup equals only a 33% margin. Confusing markup with margin is a common retail pricing error that leads to underpricing and missed profit targets.
Formula
Markup vs Margin
Selling price = cost x (1 + markup%); margin = profit / selling price x 100
- markup%
- Profit as a share of cost
Worked example
With the default values below, Markup vs Margin returns Selling Price of $60.00. Change any input above and every figure here is recalculated in your browser.
Inputs used
- Cost price
- 40
- Markupaccepts 0–500 %
- 50 %
Results
- Selling Price
- $60.00
- Profit
- $20.00
- Profit Margin
- 33.33%
Step by step
- 1Values used
- 2Markup vs Margin
- 3Selling Price= 60.00
- 4Profit= 20.00
- 5Profit Margin= 33.33
Assumptions and limits
- The result is derived only from the 2 inputs listed above. Anything not among them is not part of the calculation.
- In particular, this calculator does not take inflation, tax or compounding frequency into account.
- Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.
Frequently Asked Questions
How is Markup vs Margin calculated?
Selling price = cost x (1 + markup%); margin = profit / selling price x 100 Markup is profit relative to cost, while margin is profit relative to the selling price, so a 50% markup equals only a 33% margin.
Why does Markup vs Margin matter?
Confusing markup with margin is a common retail pricing error that leads to underpricing and missed profit targets.
What values do I need to enter?
This calculator takes 2 inputs: Cost price, Markup. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.