Profit margin & markup calculator

What is the Profit Margin & Markup Calculator?

Margin and markup both describe the relationship between what something costs you and what you sell it for, but they're calculated differently and easy to mix up. This calculator handles both, letting you solve for whichever value you're missing, your selling price, your cost, or your margin and markup percentages, from whatever numbers you already know.

How to use it

1. Choose what you want to solve for: Selling price, Margin & markup, or Cost.
2. Fill in the fields shown. When solving for selling price or cost, choose whether you're working from a margin % or a markup %, they give different results from the same percentage number.
3. Click Calculate to see your full breakdown: cost, selling price, profit, margin, and markup, all together.

Margin vs. markup, the key difference

Term	Formula	Based on
Margin	Profit ÷ Selling Price × 100	Selling price
Markup	Profit ÷ Cost × 100	Cost

Both describe the same profit, just as a percentage of two different base numbers. A markup of 50% is not the same as a margin of 50%, since they're measuring the profit against different amounts (cost vs. selling price). For example, an item that costs $40 and sells for $60 has $20 profit, a 33.3% margin (20 ÷ 60), but a 50% markup (20 ÷ 40).

Why the difference matters

Confusing margin and markup is a common and costly mistake in pricing. If you want a 30% margin but mistakenly apply a 30% markup instead, your actual margin will be lower than intended, roughly 23% in this example, not the 30% you were aiming for. Always be clear about which one you're working with when setting prices or targets.

Formulas used

• Selling price from cost and margin: Selling Price = Cost ÷ (1 − Margin%)
• Selling price from cost and markup: Selling Price = Cost × (1 + Markup%)
• Cost from selling price and margin: Cost = Selling Price × (1 − Margin%)
• Cost from selling price and markup: Cost = Selling Price ÷ (1 + Markup%)
• Margin from cost and price: Margin% = (Selling Price − Cost) ÷ Selling Price × 100
• Markup from cost and price: Markup% = (Selling Price − Cost) ÷ Cost × 100

Common uses

• Setting a selling price that hits a target profit margin
• Checking what markup to apply to reach a desired margin
• Working backward from a competitor's price to estimate their likely cost or margin
• Comparing profitability across different products with different cost structures
• Verifying that a proposed discount still leaves an acceptable margin

Frequently asked questions

Can margin ever be higher than markup for the same item?

No, for any profitable item (cost less than selling price), markup is always mathematically higher than margin, since markup is measured against the smaller cost figure while margin is measured against the larger selling price.

What happens if I enter a margin of 100% or more?

A 100% margin is mathematically undefined (it would require an infinite selling price), since margin can never reach or exceed 100% for a finite, positive cost. Keep margin inputs below 100%.

Does this account for taxes or other expenses?

No, this calculates gross profit margin and markup based on cost and selling price only. Other business expenses (overhead, taxes, shipping) would need to be factored in separately for a full net profitability picture.

Which should I use when setting prices, margin or markup?

Margin is generally more useful for understanding overall business profitability (since it's a percentage of revenue, which ties directly to your income statement), while markup is often more convenient for quickly pricing individual items from their cost. Many businesses use both depending on the context.