Markup Calculator

Calculate selling price from cost and markup percentage free online. See the difference between markup and margin, since they're commonly confused but calculated differently.

Cost Price

Markup (%)

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How to Use This Tool

Enter your cost priceThe price you paid or production cost

Enter your target markup %The percentage above cost you want to charge

See price, profit, and marginBoth markup and margin shown for clarity

Markup and Margin -- The Confusion That Costs Real Money

These two terms get used interchangeably in casual conversation but produce genuinely different numbers from identical underlying figures. A retailer planning "50% markup" and a financial analyst expecting "50% margin" on the same product are working with very different actual profit expectations, which is exactly why this distinction matters beyond pedantry.

The Math Behind the Confusion

Markup divides profit by cost (the smaller number). Margin divides profit by selling price (the larger number). The same dollar profit always produces a higher markup percentage than margin percentage, since dividing by a smaller denominator yields a larger result -- this is a pure mathematical consequence, not a quirk of either definition.

Knowing Which One Your Industry or Conversation Means

Retail and manufacturing conversations often default to markup language. Financial statements and investor conversations almost universally use margin. Showing both numbers side by side, as this calculator does, removes the ambiguity regardless of which term someone in a specific conversation actually intends.

Frequently Asked Questions

Markup is calculated as a percentage of cost: (Price - Cost) / Cost. Margin is calculated as a percentage of selling price: (Price - Cost) / Price. The same dollar profit produces a different percentage depending on which base you use, which causes frequent confusion in pricing discussions.

Selling Price = Cost x (1 + Markup% / 100). A $20 cost item with 50% markup sells for $30 -- the markup percentage applies to the cost as the base.

A 50% markup on a $20 cost produces a $30 price, giving a margin of (30-20)/30 = 33.3%, not 50%. Since margin divides by the higher selling price rather than the lower cost, margin percentage is always lower than markup percentage for the same dollar profit.

Both are used in different business contexts. Retail commonly thinks in markup ('we mark up 40% over wholesale'), while financial analysis commonly thinks in margin ('our gross margin is 35%'). Knowing both, and which one a conversation is actually referring to, prevents real pricing mistakes.

Yes, entering cost and either target markup or target price shows both percentages simultaneously, making the distinction between them concrete rather than abstract.