Profit Margin & Markup Calculator
Margin and markup are often confused — and the difference can cost a business money. Enter a cost and price, or the margin you want, and see both.
Updated
Formula
Margin = (Price − Cost) ÷ Price × 100
Markup = (Price − Cost) ÷ Cost × 100
Price for margin m = Cost ÷ (1 − m)
A 25% markup is only a 20% margin. To get a 25% margin you need a 33.3% markup.
Examples
Cost Rs 800, price Rs 1,000
Selling at Rs 1,000.00: margin 20%, markup 25%, profit Rs 200.00
Cost Rs 1,200, want 30% margin
Selling at Rs 1,714.29: margin 30%, markup 42.86%, profit Rs 514.29
Cost Rs 500, 40% markup
Selling at Rs 700.00: margin 28.57%, markup 40%, profit Rs 200.00
Reference table
| Margin | Markup |
|---|---|
| 10% | 11.1% |
| 20% | 25% |
| 25% | 33.3% |
| 30% | 42.9% |
| 40% | 66.7% |
| 50% | 100% |
Important information
- Margin can never reach 100%; markup has no upper limit.
Frequently asked questions
What is the difference between margin and markup?
Margin is profit as a share of the selling price; markup is profit as a share of cost.
What is a good profit margin?
It varies by industry — grocery retail runs on thin margins (a few %), while software and services can exceed 50%.
How do I price for a 30% margin?
Divide the cost by 0.7. A Rs 700 cost becomes Rs 1,000.
Learn more
- How to Add or Remove 18% GST — The right way to add 18% sales tax to a price and to take it out of a tax-inclusive total — and the common mistake that gives the wrong answer.
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