Margin and markup calculator
Margin and markup from the same profit — shown together, because mixing them up costs money.
Runs entirely in your browser. Nothing you paste is uploaded or stored.
What it costs you to buy or make one unit — not including your own time unless you pay for it.
or work backwards from a target
Enter a cost and either a price or a target percentage.
What this tool does
It takes a cost and a price and gives you profit, margin and markup at once — or works backwards from either percentage to the price you should charge.
Both percentages are always visible together, deliberately. Most calculators show one, which is exactly how the confusion survives.
The relationship, in one table
| Markup | Margin |
|---|---|
| 25% | 20% |
| 50% | 33% |
| 100% | 50% |
| 200% | 67% |
A 50% markup is a 33% margin. If those two numbers feel like they should be closer, that instinct is the expensive one — it is why a business aiming for “50% profit” by applying a 50% markup ends up with a third instead of a half.
What the number does not include
Margin here is gross: price minus the direct cost of the item. It does not account for rent, salaries, software, payment processing, returns or the advertising that brought the customer. A healthy gross margin is the raw material of a profitable business, not proof of one.
For products sold through advertising, look at the margin next to your break-even return on ad spend — the two together tell you whether the campaign can work at all before you spend anything on it.
Questions
What is the difference between margin and markup?
They describe the same profit against different bases. Margin is profit as a share of the selling price; markup is profit as a share of the cost. An item costing 60 and sold for 100 carries a 40% margin and a 67% markup — same 40 of profit, two very different-looking numbers.
Why does the confusion cost money?
Because a supplier quoting markup and a business planning margin will price differently for the same intended profit. Applying a 30% markup when you meant a 30% margin leaves you about 7 percentage points short on every unit — enough to erase the profit on a competitive product.
How do I set a price from a target margin?
Divide the cost by one minus the margin. For a 40% margin on a cost of 60: 60 ÷ 0.6 = 100. Do not multiply by 1.4 — that is markup, and it yields 84, which is a 29% margin.
Can margin be over 100%?
No. Margin is a share of the price, so it approaches 100% but never reaches it. Markup has no ceiling — a cost of 1 sold for 100 is a 9,900% markup and a 99% margin.
Which should I use to run a business?
Margin, for anything involving whether the business survives, because it is measured against revenue like every other percentage in a profit statement. Markup is a pricing mechanic — useful at the moment you set a price, misleading afterwards.