How to use this calculator
Enter two numbers.
- Cost: what you pay to buy or make one item, including any direct costs you want the price to cover, such as inbound shipping or packaging.
- Markup %: the percentage you add on top of cost.
The calculator returns the selling price, the profit in dollars and the margin as a percent of the selling price. Change the markup to see how the price and margin move together. If you already know your price and want to work backward to the margin, use the profit margin calculator.
Worked example
These are the starting values in the calculator above and the results they give. Change any input to see your own numbers.
- Cost
- $50
- Markup
- 60%
- Selling price
- $80.00
- Profit
- $30.00
- Margin
- 37.5%
- Markup
- 60%
How markup is calculated
Markup is profit measured against cost. To get the selling price, multiply the cost by one plus the markup written as a decimal. Profit is the selling price minus the cost.
Take an item that costs $50 with a 50% markup. The markup amount is $25, so the selling price is $75 and the profit is $25.
Margin is the same profit measured against the selling price. In the example, $25 ÷ $75 is about 33.3%. So a 50% markup gives a 33.3% margin. The dollars are identical. Only the base changes.
Selling price = C × (1 + M ÷ 100); Margin % = (Selling price − C) ÷ Selling price × 100- C
- cost of the item
- M
- markup percentage
- Selling price − C
- profit per sale
Markup compared with margin
Markup and margin are easy to confuse, and the mistake costs money. If you want a 40% margin and add a 40% markup, you will fall short. This table shows how common markups convert.
| Markup on cost | Margin on price |
|---|---|
| 25% | 20% |
| 50% | 33.3% |
| 100% | 50% |
| 200% | 66.7% |
Two points are worth remembering.
- Markup can be any size, including well over 100%. Margin can never reach 100%, because cost is always part of the price.
- The higher the markup, the wider the gap between the two numbers.
Typical markups vary a lot by industry. Fast-moving goods with heavy competition often carry low markups, while low-volume, specialty or perishable items carry higher ones. Doubling the cost, a 100% markup, is a common starting point in some kinds of retail, but it is only a rule of thumb. Your markup also has to cover overheads that are not in the item cost, such as rent and wages. The margin vs markup guide covers the conversion in more detail, and the break-even calculator shows how many sales you need at a given price.
Frequently asked questions
What is markup?
Markup is the amount added to the cost of an item to reach its selling price, usually stated as a percentage of the cost. An item that costs $40 and sells for $60 has a markup of $20, which is 50% of the cost. Markup is a pricing tool. It tells you how much to add, while margin tells you how much of the price you keep.
How do I calculate selling price from cost and markup?
Convert the markup percentage to a decimal, add one, and multiply by the cost. For a $20 item with a 30% markup, multiply $20 by 1.30 to get a selling price of $26. The profit is the $6 difference. This works for any markup, including those above 100%, where the multiplier is simply greater than two.
How do I convert markup to margin?
Divide the markup by one plus the markup, with both written as decimals. A 50% markup becomes 0.50 ÷ 1.50, which is about 33.3% margin. To go the other way, divide the margin by one minus the margin. A 20% margin becomes 0.20 ÷ 0.80, which is a 25% markup. The calculator does the first conversion for you.
What is a good markup percentage?
It depends on the product, the competition and your overheads. Goods that sell fast in crowded markets often carry low markups, while specialty, handmade or slow-moving items need higher ones to be worth stocking. A 100% markup is a familiar rule of thumb in some retail settings, but it is not a standard. The right markup covers all your costs and still leaves a price customers accept.
Why is markup always higher than margin?
Both figures divide the same profit by a different base. Markup divides by cost and margin divides by selling price. Whenever there is a profit, the selling price is larger than the cost, so dividing by it gives a smaller percentage. The two are only equal at zero, when there is no profit at all.
This calculator gives estimates for education only. It does not know your full situation and is not financial advice. Reviewed and updated November 15, 2026.