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Markup vs Margin Calculator
Easily convert between markup and gross margin. Understand how they relate to your product costs and selling prices.
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Fill in the fields above and click Calculate to see your results.
How to use
Easily convert between markup and gross margin. Understand how they relate to your product costs and selling prices.
How it's calculated
Selling Price
cost * (1 + markup_percent / 100)
Final price to charge customers
Margin (%)
(markup_percent / (100 + markup_percent)) * 100
Profit as a percentage of selling price
Gross Profit
cost * (markup_percent / 100)
Amount of profit earned per unit
Examples
Standard retail pricing
- Cost per Unit:100,000
- Markup (%):50
High-margin boutique
- Cost per Unit:500,000
- Markup (%):100
Industry Benchmarks
| Metric | Typical Range |
|---|---|
| A 50% markup equals a 33.3% margin | 50 % |
Frequently Asked Questions
What is the difference between markup and margin?
Markup is the percentage added to the cost to reach the selling price. Margin is the percentage of the selling price that is profit.
Why is margin usually lower than markup?
Margin is calculated based on the selling price (a larger number), while markup is calculated based on the cost (a smaller number). Therefore, the percentage for margin will always be lower than the markup for the same dollar amount of profit.
How do I calculate a 20% margin?
To get a 20% margin, you need a 25% markup. Formula: Price = Cost / 0.8
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