Margin & Markup Calculator
Convert between profit margin and markup, or calculate both from your cost and selling prices.
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Everything you need to know
Margin vs. Markup: The Crucial Difference
These two terms are easy to confuse, but they measure profitability from different angles. Profit margin tells you what percentage of your selling price is profit — it's the perspective of revenue. Markup tells you how much you added on top of your cost — it's the perspective of cost. A product that costs $60 and sells for $100 has a 40% margin but a 66.7% markup. Getting these mixed up can lead to seriously mispriced products and eroded profits. This calculator shows both side by side so there's never any confusion.
Two Ways to Calculate
Use "Calculate from Prices" mode when you already know your cost and selling price and want to see your margin and markup percentages. Switch to "Calculate from Percentage" mode when you know your cost and want to set a specific margin or markup target — the calculator will determine the correct selling price for you. Retailers often work backward from a target margin to set prices, while manufacturers might start with a standard markup multiplier.
Pricing Strategy Insights
Don't set prices in a vacuum. Your margin needs to cover operating expenses, taxes, and desired profit. If your gross margin is 40% but overhead eats 35%, your net margin is only 5%. Use this tool alongside your expense tracking to find the right price point. Remember that higher margins generally mean lower volume and vice versa — find the sweet spot where total profit (margin × volume) is maximized for your business model.
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Running a sale? Use the Discount Calculator to see how promotions affect your margins. Building an invoice? Try the Invoice Tax Calculator. Planning long-term growth? Check your ROI and CAGR.