Markup Calculator
Calculate markup percentage from cost and selling price, or determine the selling price based on your desired markup.
How to Use
- Select your calculation mode: "Find Markup %" to calculate markup from cost and selling price, or "Find Selling Price" to determine the price from cost and a desired markup percentage.
- Enter the cost of the item -- the amount you pay to acquire or produce it.
- Enter either the selling price or the desired markup percentage, depending on your selected mode.
- Click "Calculate" to see the markup percentage, markup amount, profit margin, and selling price.
Frequently Asked Questions
What is the difference between markup and profit margin?
Markup is the percentage added to the cost to get the selling price. It is calculated as (Selling Price - Cost) / Cost. Profit margin is the percentage of the selling price that is profit, calculated as (Selling Price - Cost) / Selling Price. For example, a $50 item sold at $80 has a 60% markup but a 37.5% profit margin.
Why is markup always higher than profit margin?
Markup is based on the cost (a smaller number), while profit margin is based on the selling price (a larger number). Since the same dollar amount of profit is divided by a smaller number for markup, the resulting percentage is always higher. They only approach equality when the markup is very small.
What is a typical markup percentage?
Markup varies widely by industry. Grocery stores often use 5-15% markup, clothing retail typically uses 50-100%, restaurants may use 200-300% on food, and luxury goods can exceed 500%. The appropriate markup depends on your overhead, competition, and target market.
Can I have a 0% markup?
Yes, a 0% markup means you are selling at cost with no profit. This is sometimes done as a loss leader strategy to attract customers. If you enter a selling price equal to cost, the calculator will show 0% markup and 0% profit margin.