PercentSwift

Margin and markup calculator

Enter a cost and a selling price to get the profit, the margin and the markup. The second tab works the other way: give it a cost and the margin you want, and it finds the price.

Profit margin and markup

Settings
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Profit margin

33.333333%

Selling at $60.00 with a cost of $40.00 gives a 33.333333% margin and a 50% markup.

Rounded to 2 decimal places
Profit
$20.00
Markup
50%

Formula

Margin % = (Price − Cost) ÷ Price × 100; Markup % = (Price − Cost) ÷ Cost × 100

Steps

  1. Profit: $60.00 − $40.00 = $20.00
  2. Margin: 20 ÷ 60 × 100 = 33.333333%
  3. Markup: 20 ÷ 40 × 100 = 50%
  • Margin divides profit by the selling price. Markup divides it by the cost. For the same sale, markup is always the larger number when there's a profit.

Exact decimal arithmetic, calculated in your browser.

Examples

Each one loads into the calculator above.

Margin and markup are different percentages

Both start from the same profit: selling price minus cost. Margin divides that profit by the selling price. Markup divides it by the cost.

A product that costs $40 and sells for $60 makes $20 profit. The margin is 20 ÷ 60 = 33.33%, and the markup is 20 ÷ 40 = 50%. Neither is wrong, but mixing them up leads to prices that miss their target.

Pricing for a target margin

Divide the cost by 1 minus the target margin. For a 30% margin on a $40 cost: 40 ÷ 0.7 = $57.14. Adding 30% to the cost ($52) gives a margin of only 23%.

Converting between the two

  • Margin = markup ÷ (1 + markup)
  • Markup = margin ÷ (1 − margin)

A 50% markup is a 33.3% margin, and a 25% margin is a 33.3% markup.

What counts as cost

For a single product’s gross margin, cost usually means what you paid for the goods, including shipping to you. Operating and net margins subtract more costs, such as wages, rent and tax, and are calculated on the whole business. The calculator uses whatever cost you give it, so be clear which margin you’re quoting.

Questions people ask

Guides that use this calculator