How this calculator works
Markup divides profit by cost, while margin divides it by selling price. A positive cost is required because markup at zero cost is undefined. Reverse mode can show a negative markup for a sale below cost; a zero selling price has no defined margin.
The formula
Profit = Selling price − Cost
Markup % = Profit / Cost × 100
Selling price = Cost × (1 + Markup % / 100)
Margin % = Profit / Selling price × 100.A quick example
An item costing 80 with a 25% markup sells for 100. Profit is 20 and margin is 20%, not 25%.
How to use this calculator
- Choose forward pricing or reverse markup.
- Enter cost and either markup or the existing selling price.
- Review price, profit and margin on their respective bases.
A few common questions
Is 25% markup the same as 25% margin?
No. A 25% markup on cost corresponds to a 20% margin on selling price.
Can cost be zero?
No. Markup divides by cost, so the percentage would be undefined.
Can the selling price be below cost?
Yes in reverse mode. The result shows a negative markup and a loss.