About the Markup Calculator
This markup calculator solves cost-plus pricing in whichever direction you need. Choose what you know — cost and markup, cost and selling price, price and markup, or cost and a target margin — and it works out the missing figure along with the gross profit per unit and the equivalent profit margin.
Retailers, wholesalers, restaurants, makers selling online and contractors pricing jobs use markup every day. It is easy to confuse markup with margin: markup is profit as a percentage of cost, while margin is profit as a percentage of the selling price. A 50% markup is only a 33.3% margin, so pricing with the wrong one can quietly wipe out your profit. This tool shows both side by side.
Cost should be your full landed cost per unit — purchase price plus freight, duties and packaging. Enter prices before sales tax. For a full side-by-side conversion table, see the margin vs markup calculator.
With the default inputs, the selling price is $60.00. Change any value above to recalculate instantly.
How to use the markup calculator
- 1Choose which two values you already know.
- 2Enter your cost per unit, including shipping and duties.
- 3Enter the markup, selling price or target margin.
- 4Read the missing value, profit per unit and profit margin.
- 5Optionally enter units sold to see total revenue and profit.
Formula and method
Markup expresses profit as a percentage of cost, so the selling price is cost multiplied by one plus the markup. Rearranging gives markup from a known cost and price, or cost from a known price and markup: cost = price ÷ (1 + markup).
Margin expresses the same profit as a percentage of the selling price. To hit a target margin, price = cost ÷ (1 − margin). Because the price is always larger than the cost, the margin percentage is always smaller than the markup percentage for the same product.
- Cost
- Landed cost per unit
- Markup
- Profit ÷ cost, as a decimal
- Margin
- Profit ÷ selling price, as a decimal
Worked examples
$40 cost with a 50% markup
A 50% markup on a $40 cost adds $20, so the selling price is $60. That $20 profit is 33.3% of the $60 price, which is the profit margin.
Find the markup on a $25 item sold for $40
Profit is $40 − $25 = $15. Dividing by cost gives a 60% markup; dividing by price gives a 37.5% margin.
Work back to cost from a $100 price and 25% markup
Cost = $100 ÷ 1.25 = $80, so each sale earns $20 (a 20% margin). Selling 200 units gives $4,000 of gross profit.
Price for a 40% margin on a $40 cost
To keep 40% of the price as profit, price = $40 ÷ 0.60 = $66.67. That requires a 66.7% markup — much higher than the margin figure.
Frequently asked questions
How do you calculate markup?+
Subtract cost from the selling price to get profit, then divide profit by cost and multiply by 100. For example, an item costing $30 and selling for $45 has a $15 profit and a 50% markup.
What is the difference between markup and margin?+
Markup is profit as a percentage of cost; margin is profit as a percentage of selling price. For the same sale the markup percentage is always higher: a 100% markup is a 50% margin, and a 25% markup is a 20% margin.
How do I convert margin to markup?+
Markup = margin ÷ (1 − margin). A 40% margin needs a markup of 0.40 ÷ 0.60 = 66.7%. To go the other way, margin = markup ÷ (1 + markup).
What is a typical retail markup?+
It varies by product. Keystone pricing — a 100% markup, doubling the wholesale cost — is a common starting point in apparel and gifts, while groceries and electronics often run far lower markups because of competition and volume.
Should markup include shipping and overhead?+
Include every cost that is tied to each unit — purchase price, inbound freight, duties and packaging — in the cost figure. Overhead such as rent is usually covered by the markup itself; use a break-even calculator to check the markup covers it.