Calcwise / Money and tax / Margin and markup calculator
Margin and markup calculator
Enter your cost and your selling price to see the margin and markup, or add a target margin to get the price.
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About this tool: Margin and markup calculator
Margin and markup both describe profit, but against different bases. Margin is profit as a share of the selling price. Markup is profit as a share of the cost. A 50% markup is only a 33% margin, and mixing them up is a common pricing mistake.
Use prices without VAT on both sides, since VAT is not your income. To reach a target margin, the tool works out the price from your cost.
Formula
Margin = (price − cost) ÷ price × 100. Markup = (price − cost) ÷ cost × 100. Price for a target margin m = cost ÷ (1 − m ÷ 100).
Worked example
Cost 60, price 100: profit 40, margin 40%, markup 66.67%. For a 30% margin on the same cost the price must be 60 ÷ 0.70 = 85.71.
Sources and data
- Formulas and data last reviewed
- Accuracy
- The result is plain maths: with valid input it is exact, and we only round to cents.
Frequently asked questions
What is the difference between margin and markup?
Margin divides profit by the selling price, markup divides it by the cost. For the same sale the markup is always the larger number.
Can the margin be 100%?
Only if the cost is zero. A target margin has to be below 100%, because the price would otherwise have to be infinite.
Should I include VAT?
No. Use net prices. VAT is collected for the tax office and is not part of your profit.