Markup Calculator
The markup calculator sets a selling price by adding a percentage markup on top of your cost. Enter what an item costs you and the markup percentage you want to apply, and it instantly returns the selling price, the profit in dollars, and the margin that markup works out to. It's the quickest way to price consistently across a range from a single markup rule. Figures are estimates for planning — check pricing that affects your bottom line with your accountant.
Calculator
The formula
Selling price = cost × (1 + markup ÷ 100)
Multiply the cost by the markup percentage to get the profit added on, then add it to the cost to get the price. The resulting margin is (price − cost) ÷ price × 100 — always lower than the markup, because markup is measured against cost while margin is measured against price.
Worked example
An item costs $40 and you apply a 50% markup.
- Profit added = 40 × 50% = $20
- Selling price = 40 + 20 = $60
- Margin = 20 ÷ 60 × 100 = 33.3%
So a 50% markup on cost gives a 33.3% margin on price.
Frequently asked questions
- Why is my margin lower than my markup?
- Markup is a percentage of cost; margin is a percentage of the (higher) selling price. Dividing the same profit by a larger number gives a smaller percentage, so margin is always below markup.
- How do I pick a markup?
- Choose a markup that covers your overheads and target profit on top of the item cost. Many businesses set different markups by product line rather than one blanket rate.
- Does markup include tax?
- No — this works on your cost and desired profit only. Sales tax or VAT is handled separately; confirm tax treatment with your accountant.
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