Margin and Markup Calculator
Calculate profit margin and markup from cost and selling price.
Tip: Margin is calculated from the selling price; markup from the cost.
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About this digital tool
The margin and markup calculator helps you set the selling price and profit from cost. Enter the product cost and selling price, or the cost and the percentage you want, and the tool gives the profit, margin and markup. Margin = (price − cost) ÷ price × 100, while markup = (price − cost) ÷ cost × 100.
Two indicators are often confused: margin is calculated from the selling price, markup from the cost. A 50% markup is the same as a 33% margin. It is useful for shops, manufacturers and online sellers when setting prices. The result is an estimate and does not include other costs such as rent, wages or taxes.
How to use
- Enter the product cost per unit.
- Enter the selling price or the percentage you want to reach.
- See the profit per unit, the margin and the calculated markup.
- Adjust the price until the margin covers the business's other expenses.
Frequently asked questions
What is the difference between margin and markup?
Margin = profit ÷ selling price × 100. Markup = profit ÷ cost × 100. E.g. cost 8,000 lek, price 10,000 lek: margin = 20%, markup = 25%.
How is profit margin calculated?
Divide the profit (price minus cost) by the selling price and multiply by 100. If the cost is 600 and the price 1,000 lek, the margin is 40%.
How do I calculate the selling price from cost and margin?
Price = cost ÷ (1 − margin). For a cost of 600 lek and a 40% margin the price is 1,000 lek. With markup you calculate it as cost × (1 + markup).
Why aren't margin and markup the same thing?
Because they have different bases: margin uses the selling price, markup the cost. For the same profit, markup always comes out larger than margin.