Margin and markup calculator
Work out markup, margin, profit and selling price from cost.
Fill in the fields and the result will appear here automatically.
This margin and markup calculator shows both figures at once and makes the difference obvious: markup is measured against cost, margin against the selling price, so a 25% markup and a 20% margin describe the same deal. It works in three modes — from a known price, from a target markup and from a target margin — and also reports profit per unit and per batch.
How it works
Formula and logic
For cost C > 0 and price P > 0: difference = P − C; markup = (P−C)/C × 100%, margin = (P−C)/P × 100%. From markup u: P = C × (1+u/100); from margin m < 100%: P = C / (1−m/100). Negative percentages are valid if price stays positive. For positive price and cost, signed markup is at least margin: their difference is (P−C)²/(C×P) × 100. For a loss the absolute margin is larger; when price equals cost, both are 0. Quantity is a whole number at least 1; batch difference = (P−C) × quantity.
Example
A cost of 100 and a price of 125 give a profit of 25, a markup of 25% and a margin of 20% — one deal described by two different percentages.
Fields and units
- Mode — list option
- Cost — $
- Selling price — $
- Markup — %. A sale at a loss may use a negative markup above−100%; the resulting price must remain positive.
- Margin — %. A negative margin can describe a loss; it must be below 100% and produce a positive price.
- Quantity — unitless. A whole number of at least 1. A fraction is not truncated, and 0 is not replaced with 1.
How to use
- — Choose what you already know: the selling price, a target markup or a target margin.
- — Enter the cost of one unit of the product or service.
- — Fill in the second value — price, markup or margin.
- — Set a quantity if you need the profit for a whole batch, and compare markup with margin.
Method and limitations
- Calculation method
- Formula and logic
- Data or methodology source
- OpenStax, Elementary Algebra 2e: percentage markup on original cost
- Limitation
- The price-minus-entered-cost difference uses your chosen cost basis; it is not automatically business net profit. Taxes, fees and overhead are not added separately.
FAQ
What is the difference between margin and markup?
The base they are measured against. Markup shows how far the price sits above cost, while margin shows what share of the selling price is profit. The profit is the same in both cases; only the denominator changes.
Why is margin always lower than markup?
Because on a profitable sale the price is higher than the cost. The same profit is divided by a larger number, so the percentage comes out smaller: a 100% markup is a 50% margin.
How do I convert markup into margin and back?
Margin = markup ÷ (100 + markup) × 100. Markup = margin ÷ (100 − margin) × 100. The calculator does this conversion automatically in every mode.
Why can margin not reach 100%?
A 100% margin would mean zero cost, and anything above it a negative cost. As margin approaches 100% the required price grows without limit, so those values are rejected.
Does it include VAT or other taxes?
No. The calculator works with the amounts you enter. If you need to add or extract VAT, do that separately and use the resulting figures here.
What if the price is below cost?
The calculation still runs: profit, markup and margin turn negative and the calculator adds a note. That is useful for checking the loss on a promotion or a clearance sale.