Markup versus margin calculator
Convert desired markup to margin and vice versa.
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How it works
Convert a markup on cost into its equivalent margin on selling price, or work backward from a target margin. Enter a positive unit cost to see the price and profit alongside both percentages.
A few things to know
Uses nonnegative markup or margin and a positive cost. Costs and price must use the same currency and cost scope. It does not include price-dependent fees, discounts, taxes or overhead unless accounted for separately. The conversion changes the percentage denominator; it does not change the amount of profit.
Results use your inputs. Keep all money amounts in the same currency.
When to use this tool
Markup and margin describe the same profit amount with different denominators. Confusing them can turn a target into a price that earns less than expected. This markup versus margin calculator converts the percentage you know, shows the corresponding selling price, and places both measures together so a supplier quote, pricing sheet or customer discussion uses clear terms.
- Translate a supplier’s suggested markup into the margin your pricing dashboard tracks.
- Build a selling price from a target margin without accidentally adding that percentage to cost.
- Check a price list before sharing it with colleagues who use different pricing terminology.
How to use markup versus margin calculator
Enter a positive unit cost
Use the complete cost scope you want to compare, in one currency. A positive cost is required because markup is expressed as a percentage of that cost.
Choose the percentage definition
Select markup on cost or margin on selling price. This selection determines the price formula; the same entered percentage produces different prices in the two modes.
Review both percentages and the price
Enter the known percentage, calculate, and compare markup, margin and profit per unit. If you change the cost later, the price and profit amount change while the equivalent percentages stay the same.
A 50% markup is a 33.33% margin
Inputs
Unit cost 100; percentage type markup; known percentage 50%.
Result
Selling price 150.00; profit per unit 50.00; markup 50%; margin 33.33%.
What it means
The profit of 50 is half the cost of 100 but only one third of the price of 150. Switching to a 50% margin instead produces a price of 200.00.
Common mistakes to avoid
Using the wrong denominator
Markup compares profit with cost. Margin compares profit with selling price. Writing “50% profit” without naming the denominator leaves the pricing instruction ambiguous.
Assuming markup stops at 100%
Markup can exceed 100% because price can be several times cost. A positive-cost margin remains below 100%; entering 200% as a margin is not a valid equivalent.
Mixing cost scopes
A markup calculated from supplier cost cannot be compared directly with a margin after packaging, commissions and advertising. Define the same costs before comparing percentages.
Frequently asked questions
Definitions, edge cases, and practical next steps for this tool. Search all tool FAQs ↗
What is the difference between markup and margin?
Markup is the profit amount divided by unit cost; margin is the profit amount divided by selling price. Because selling price is larger than cost when profit is positive, the margin percentage is lower than the corresponding markup percentage.
How do I convert markup to margin?
Turn markup into a decimal, then divide it by one plus that decimal. For 50% markup, 0.50 divided by 1.50 gives one third, or 33.33% margin. The calculator also shows the price for your entered unit cost.
How do I convert margin to markup?
Divide the margin decimal by one minus the margin decimal. A 40% margin gives 0.40 divided by 0.60, or 66.67% markup. At a cost of 60, both percentages describe the same selling price of 100.
Can a markup be greater than 100%?
Yes. A cost of 100 with a 200% markup produces a price of 300 and profit of 200. The equivalent margin is 66.67%. High markup does not itself prove high net profitability because additional business costs may still be omitted.
Why must the unit cost be above zero?
A zero cost makes markup undefined because its denominator is zero. The tool requires a positive cost so both percentages can be meaningfully compared. For a service with little material cost, consider an allocation of labor and delivery costs rather than assuming zero.
Does zero markup mean a zero selling price?
No. Zero markup means the selling price equals the unit cost and the modeled profit is zero. The equivalent margin is also zero. At a cost of 100, zero markup produces a price of 100, before any expenses outside that cost scope.
Can this calculator show a loss?
This converter accepts nonnegative markup and margin because it is intended for positive-cost pricing targets. To analyze an existing selling price below cost, use the profit margin and target-price calculator, which keeps negative current margins visible.
Should I use margin or markup for my price sheet?
Either can work if the definition and cost scope are stated. Margin is useful when evaluating the share of revenue retained; markup is useful when building a price from cost. Include both when exchanging a spreadsheet with people who use different conventions.
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Sources and method
Use the references below to check definitions and platform guidance. The model’s scope and limits are explained above. Read our editorial standards.