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Markup vs. margin calculator

Markup and margin both measure the same profit, but markup divides it by the cost and margin divides it by the price. So the same sale always has a bigger markup than margin.

Example numbers to start (example number: Made up to show how the calculator works). The starting numbers are made up, not real prices. Type your own: they stay on this page and aren't sent anywhere.

From a cost and a price

What you pay to make or buy one.

The price a customer pays for one.

Markup

150%

The $6.00 you add, as a share of the $4.00 cost.

Margin

60%

The same $6.00, as a share of the $10.00 price.

What it costs you, $4, 40%What you keep, $6, 60%

How it's worked out

Markup = (price − cost) ÷ cost. → $6.00 ÷ $4.00 = 150%

Margin = (price − cost) ÷ price. → $6.00 ÷ $10.00 = 60%

Turn one into the other

Type in either box; the other one changes to match.

A 50% markup is a 33.3% margin.

How it's worked out

Margin = markup ÷ (1 + markup). → 50% ÷ (100% + 50%) = 33.3%

Learn the idea behind it

A calculator gives you the number. The lesson shows you what it means and what to do about it.

Free lesson

Margins: where each dollar goes

Follow a sale down to profit, see why the same dollars make a bigger markup than margin, and compare three businesses' margins.

Take the lesson

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