What's the difference between margin and markup?

Markup is profit as a percentage of cost: how much more you charge than you pay. Margin is profit as a percentage of selling price: what fraction of revenue is profit. The same dollar profit produces different percentages depending on which denominator you use.

Which one should I use?

Margin for profitability analysis (it tells you what fraction of every dollar of revenue is profit). Markup for setting prices from supplier costs. Industry conventions vary; clarify which you mean to avoid confusion.

Why are 50% markup and 50% margin different?

50% markup means selling price is 1.5x cost — selling at $15 if cost is $10, with $5 profit. 50% margin means profit is 50% of selling price — selling at $20 if cost is $10, with $10 profit. Same words, different math.

Can margin exceed 100%?

No. Margin is profit divided by selling price; if profit equals selling price, margin is 100% but cost is zero. Negative margin (loss) is possible.

Can markup exceed 100%?

Yes. Markup is profit divided by cost; selling for more than 2x cost gives over 100% markup. Very high markups are common in luxury goods, software, and some service industries.

How do I price for a desired margin after fees?

Calculate the selling price needed to hit the target margin on your full cost (including fees). For example, with 30% target margin and 15% platform fee on a $10 cost item, you need to gross enough to leave 30% margin after the 15% fee — solve for the price.

Are calculations done locally?

Yes. The calculator runs in your browser; no data is sent anywhere.

Should margin include overhead?

Gross margin uses direct product cost only. Net margin or operating margin includes overhead. This calculator computes margin against whatever cost you input; pick the cost figure that matches the margin definition you want.

Free Converter

Margin & Markup Calculator

Calculate gross margin, markup percentage, and profit for your business pricing.

Margin Calculator

Selling Price /

Cost Price ($)

Selling Price ($)

Selling Price

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Gross Profit

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Gross Margin

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Markup %

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Margin = (Revenue − Cost) / Revenue × 100%
Markup = (Revenue − Cost) / Cost × 100%

Markup vs Margin Reference

Markup %	Margin %
10%	9.09%
20%	16.67%
25%	20.00%
33%	24.81%
50%	33.33%
100%	50.00%

About Margin and Markup Calculator

Margin and markup are both ways of expressing the relationship between cost and selling price, but they use different denominators and produce different numbers for the same situation. Markup is profit divided by cost (how much more you charge than you pay). Margin is profit divided by selling price (what fraction of revenue is profit). A 50% markup is a 33.3% margin; a 50% margin is a 100% markup. Confusing these is one of the most common pricing errors in retail and e-commerce.

This calculator handles both directions. Given any two of cost, selling price, profit, margin percentage, and markup percentage, it computes the others. Whether you start with a target margin and need to determine the selling price, or with cost and markup and need the resulting margin, the calculation is one form fill away.

Calculations happen in your browser using basic arithmetic. Currency formatting is applied to dollar amounts; percentages are shown to two decimal places by default.

Why Use a Margin/Markup Calculator

Pricing decisions in retail, wholesale, and e-commerce frequently involve switching between margin and markup language. Suppliers may quote in markup; finance may track in margin; pricing software may use either. A calculator that converts between the two prevents the most common pricing math error.

The calculator also helps with target-margin pricing. Given a desired margin and known cost, what selling price achieves the target? This is a one-formula calculation, but doing it consistently across many products benefits from a tool rather than mental math.

How to Use the Margin/Markup Calculator

Enter any two values, get the others.

Enter cost and selling price: If you know both, the calculator returns profit, margin %, and markup %. The most common starting point for established products.
Or enter cost and target margin: If you have a desired margin and know the cost, the calculator returns the selling price and equivalent markup. Use this for target-pricing new products.
Or enter cost and markup: Wholesalers often quote markup. Given cost and markup, the calculator gives selling price and equivalent margin.
Compare scenarios: Run multiple calculations to see how different margins or markups affect the resulting prices and profits. The calculator does not preserve history; record results separately if comparing options.

Common Use Cases

Setting retail prices for new products — Given a wholesale cost and a target margin, calculate the selling price needed to hit the target.
Converting supplier markup quotes to margin — Suppliers commonly quote in markup; financial reporting commonly uses margin. The calculator converts between the two.
Validating that current pricing meets margin targets — For existing products, plug in cost and selling price to see whether the resulting margin matches goals.
Pricing for online marketplaces — Amazon, Etsy, eBay, and similar platforms have fees that reduce effective margin. Use the calculator to set list prices that achieve target margins after fees.
Wholesale pricing for distribution channels — Multi-tier distribution requires calculating prices at each level so each tier achieves its margin target.

Technical Details

Markup percentage = ((selling price - cost) / cost) * 100. Margin percentage = ((selling price - cost) / selling price) * 100. Profit = selling price - cost.

Inverting: selling price from cost and margin = cost / (1 - margin/100). Selling price from cost and markup = cost * (1 + markup/100). Margin from markup = markup / (1 + markup/100). Markup from margin = margin / (1 - margin/100).

Floating-point arithmetic is fine for currency to two decimal places. The calculator rounds final values for display while keeping internal precision higher to avoid compounding rounding.

Best Practices

Be explicit about which one you mean — When discussing prices with suppliers, customers, or finance, always clarify whether you mean margin or markup. The numbers diverge significantly above 25%.
Account for all costs — Cost should include not just supplier price but also shipping, duties, returns, and direct selling expenses. Margin on direct cost only overstates true profit.
Set targets in margin, not markup — Margin is the more meaningful figure for profitability analysis. Setting goals in margin avoids the mental confusion of converting markup to actual profit.
Build margin headroom for fees — Marketplaces, payment processors, and platforms take fees that reduce effective margin. Set list prices with enough headroom to hit target margins after fees.

Frequently Asked Questions

What's the difference between margin and markup?: Markup is profit as a percentage of cost: how much more you charge than you pay. Margin is profit as a percentage of selling price: what fraction of revenue is profit. The same dollar profit produces different percentages depending on which denominator you use.
Which one should I use?: Margin for profitability analysis (it tells you what fraction of every dollar of revenue is profit). Markup for setting prices from supplier costs. Industry conventions vary; clarify which you mean to avoid confusion.
Why are 50% markup and 50% margin different?: 50% markup means selling price is 1.5x cost — selling at $15 if cost is $10, with $5 profit. 50% margin means profit is 50% of selling price — selling at $20 if cost is $10, with $10 profit. Same words, different math.
Can margin exceed 100%?: No. Margin is profit divided by selling price; if profit equals selling price, margin is 100% but cost is zero. Negative margin (loss) is possible.
Can markup exceed 100%?: Yes. Markup is profit divided by cost; selling for more than 2x cost gives over 100% markup. Very high markups are common in luxury goods, software, and some service industries.
How do I price for a desired margin after fees?: Calculate the selling price needed to hit the target margin on your full cost (including fees). For example, with 30% target margin and 15% platform fee on a $10 cost item, you need to gross enough to leave 30% margin after the 15% fee — solve for the price.
Are calculations done locally?: Yes. The calculator runs in your browser; no data is sent anywhere.
Should margin include overhead?: Gross margin uses direct product cost only. Net margin or operating margin includes overhead. This calculator computes margin against whatever cost you input; pick the cost figure that matches the margin definition you want.

Margin & Markup Calculator

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About Margin and Markup Calculator

Why Use a Margin/Markup Calculator

How to Use the Margin/Markup Calculator

Common Use Cases

Technical Details

Best Practices

Frequently Asked Questions

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