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Business & Marketing
Markup Calculator — Cost to Price, Markup % and Margin
Price your product from cost up — and see why markup and margin are not the same number
Markup is how most small businesses set a price: you start with what an item costs you, add a percentage on top, and that becomes the sticker price. A boutique buys a candle for $8 and marks it up 150% to sell at $20. A coffee shop pays $0.40 for a cup of beans and prices the latte at $4.50. A contractor adds 35% to material cost to cover overhead and profit. The markup is the cushion between cost and price, expressed as a percent of cost.
The core formula is simple:
- Markup % = (price − cost) ÷ cost × 100
- Price = cost × (1 + markup ÷ 100)
- Profit (per unit) = price − cost
Work an example. A product costs you $60. You apply a 50% markup: price = 60 × 1.50 = $90. Your profit is 90 − 60 = $30 per unit. So far, clean.
Here's the part that trips people up. That same $30 profit is 50% of cost but only 33.3% of the selling price. The percentage of price is called the margin, and it is always a smaller number than the markup. Margin = profit ÷ price, while markup = profit ÷ cost. Same dollars, different base. A 50% markup is a 33.3% margin. A 100% markup (doubling the cost — "keystone" pricing in retail) is a 50% margin. A 25% markup is only a 20% margin.
This difference matters because the two terms get used interchangeably in conversation but mean different things on a profit-and-loss statement. If your accountant says "we need a 40% margin" and you set a 40% markup, you'll come up short — a 40% markup is only a 28.6% margin. To hit a 40% margin you need a 66.7% markup. Mixing them up is one of the most common pricing mistakes in retail and food service.
Use this calculator to go from cost to price in one step. Enter your unit cost and the markup you want, optionally with a quantity, and it returns the selling price, the per-unit and total profit, and the equivalent margin so you can see exactly what that markup is worth as a share of revenue. If you'd rather start from a target margin or price and work backward, the profit-margin calculator is the companion tool — they answer the same question from opposite ends.
These figures are pricing estimates for planning, not tax or accounting advice — fold in shipping, fees, shrinkage and overhead before you commit to a price.
📖 See also: How to Calculate a Tip (and Split the Bill)
Calculator
Fill in the fields and click "Calculate" for instant results.
📰 Formula
• Markup % = (price − cost) ÷ cost × 100 • Price = cost × (1 + markup ÷ 100) • Profit per unit = price − cost • Margin % = profit ÷ price × 100 = markup ÷ (100 + markup) × 100
📰 Formula
• Markup % = (price − cost) ÷ cost × 100 • Price = cost × (1 + markup ÷ 100) • Profit per unit = price − cost • Margin % = profit ÷ price × 100 = markup ÷ (100 + markup) × 100
🧪 Worked examples
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Example 2
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Example 3
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Example 4
⚠️ Common mistakes
- Treating markup and margin as the same number — a 50% markup is only a 33.3% margin.
- Dividing profit by price (that's margin) when computing markup, which uses cost.
- Forgetting that price must be greater than cost for a positive markup.
- Leaving out shipping, fees and overhead, so the 'profit' overstates what you keep.
- Setting the markup equal to the target margin and ending up under-priced.
💡 Tips
- To convert markup to margin: margin = markup ÷ (100 + markup) × 100.
- To hit a target margin, the markup must be larger: markup = margin ÷ (100 − margin) × 100.
- Keystone pricing (100% markup) is a clean 50% margin — a handy retail benchmark.
- Build all per-unit costs (product + freight + fees) into 'cost' before applying markup.
Embed this calculator on your site
Copy the code below and paste it into the HTML of your site or blog.
<iframe src="https://www.calcnimbus.com/embed/markup-calculator" width="100%" height="500" frameborder="0" style="border:1px solid #eee;border-radius:12px"></iframe>
❓ Frequently asked questions
How do I calculate markup percentage?
Markup % = (selling price − cost) ÷ cost × 100. If an item costs $60 and sells for $90, markup = (90 − 60) ÷ 60 × 100 = 50%.
What's the difference between markup and margin?
Markup measures profit against cost; margin measures the same profit against the selling price. A $30 profit on a $60 cost item priced at $90 is a 50% markup but a 33.3% margin.
How do I find the selling price from cost and markup?
Price = cost × (1 + markup ÷ 100). A $40 item with a 100% markup sells for 40 × 2.00 = $80.
What markup gives a 50% margin?
A 100% markup. Doubling your cost (keystone pricing) means profit equals cost and also equals half the price, so the margin is 50%.
How do I convert a margin into the markup I need?
Markup = margin ÷ (100 − margin) × 100. To get a 40% margin you need a 40 ÷ 60 × 100 = 66.7% markup.
What is keystone markup in retail?
Keystone is a 100% markup — you double the wholesale cost to set the retail price. It's a common starting point in apparel and gift retail and equals a 50% margin.
Can markup be more than 100%?
Yes. Many products carry markups of 150%, 200% or more, especially low-cost items like food, drinks and accessories. A 200% markup means the price is three times the cost.
Why is my margin lower than my markup?
Because margin divides profit by the larger number (price) while markup divides by the smaller number (cost). The margin is always less than the markup for the same product.
Does this markup figure account for sales tax and fees?
No. The calculator works on unit cost and price only. Add freight, payment-processing fees, shrinkage and overhead to your cost first; sales tax is collected on top of the price separately.