Markup vs Margin Calculator
Understand the difference between markup and margin, and convert between the two instantly.
Results are for general guidance only — not professional advice. Learn more.
How to use this tool
Choose your calculation direction, enter your base price and either a markup or margin percentage to instantly see the corresponding selling price, profit, and both percentages.
- Select Cost → Selling Price if you know your cost and want to find your selling price, or Selling Price → Cost to work backwards.
- Enter the base price in the first field.
- Enter either a Markup % or a Margin % — the tool will use whichever you fill in.
- Read off the selling price (or cost), gross profit, markup %, and margin % immediately.
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Frequently asked questions
What is the difference between markup and margin?
Markup is the amount added to the cost price to arrive at the selling price, expressed as a percentage of cost. Margin (or gross margin) is the profit expressed as a percentage of the selling price. For example, if a product costs £60 and sells for £100, the markup is 66.7% but the margin is 40%.
Which should I use: markup or margin?
It depends on your context. Retailers and manufacturers often think in markup because they start from a known cost. Finance teams and investors typically prefer margin because it relates directly to revenue. For consistency with financial reporting and industry benchmarking, margin is generally recommended.
How do I convert markup to margin?
To convert markup to margin: Margin = Markup / (1 + Markup). For example, a 50% markup equals a 33.3% margin (0.5 / 1.5 = 0.333). To convert margin to markup: Markup = Margin / (1 − Margin). A 40% margin equals a 66.7% markup (0.4 / 0.6 = 0.667).
Why does markup percentage always exceed margin percentage?
Because they use different bases. Markup uses cost as the base (a smaller number), while margin uses selling price as the base (a larger number). Since the same profit amount is divided by a smaller number for markup and a larger number for margin, markup will always produce a higher percentage than margin for the same product.