Business Tools

Markup Calculator

Calculate markup percentage and selling price from cost. Find markup, margin, and profit with reverse calculations for optimal pricing strategy.

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About this tool

Markup is the amount added to cost to determine selling price. Markup % = (Selling Price - Cost) / Cost × 100. Different from margin, which uses selling price as denominator.

Retailers typically use 50-100% markup. Restaurants 200-400%. Jewelry 300%+. Higher markup doesn't always mean higher profit - consider sales volume. Use margin for profitability analysis, markup for pricing decisions.

Usage examples

Retail Clothing

100% markup standard

Cost $30 + 100% markup = Sell $60. Profit $30 (50% margin)

Restaurant Food

300% markup

Cost $5 + 300% markup = Sell $20. Profit $15 (75% margin)

Reverse Calculate

Find needed markup

Want to sell at $100 with cost $40 → Need 150% markup (60% margin)

How to use

  1. Enter "Cost Price" (what you pay).
  2. Enter "Markup Percentage" or "Selling Price".
  3. Click "Calculate" to see profit and margin.
  4. Compare different markup scenarios.

Benefits

  • Calculate markup & margin
  • Reverse calculations
  • Profit breakdown
  • Industry benchmarks
  • Markup vs margin comparison
  • Multiple pricing scenarios

FAQs

What is the difference between markup and margin?

Markup = profit as % of COST. Margin = profit as % of SELLING PRICE. Example: Buy $50, sell $100. Markup = $50/$50 = 100%. Margin = $50/$100 = 50%. Same dollar profit, different percentages. Markup can exceed 100%, margin cannot. Use margin for profitability, markup for pricing.

How do you calculate selling price from cost and markup?

Selling Price = Cost × (1 + Markup%). Example: Cost $50, markup 80% → $50 × 1.80 = $90. Or: Selling Price = Cost + (Cost × Markup%). $50 + ($50 × 0.80) = $90. Common mistake: Adding markup% directly to cost (wrong). Must multiply by (1 + markup%).

What is a good markup percentage for retail?

Varies by industry. Grocery: 15-25%. Clothing: 50-100%. Jewelry: 100-300%. Furniture: 200-400%. Restaurants: 300%+. Consider: Cost of goods, overhead, competition, perceived value, sales volume. Higher markup on slow movers. Lower markup on high-volume items. Industry standard ≠ right for your business.

How do I convert markup to margin?

Margin = Markup ÷ (1 + Markup). Example: 100% markup → 100% ÷ 2 = 50% margin. 50% markup → 50% ÷ 1.5 = 33.3% margin. Reverse: Markup = Margin ÷ (1 - Margin). 40% margin → 40% ÷ 0.6 = 66.7% markup. Always lower margin than markup for same product.

Should I use markup or margin for pricing?

Use MARKUP for setting prices (add to cost). Use MARGIN for analyzing profitability (percentage of sales). When quoting: "We mark up cost by X%". When reporting: "We have Y% profit margin". Both describe same profit, different perspectives. Know your target margin, calculate required markup to achieve it.

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