Markup Calculator
The Markup Calculator estimates a selling price and unit profit from a product cost and a target profit margin. It is useful for pricing checks because margin and markup are related but use different denominators.
How to use this calculator
- Enter the product cost or purchase cost per unit.
- Enter the desired profit margin as a percentage of the final selling price.
- Review the calculated selling price, profit per unit, and implied markup percentage.
- Compare the result with shipping, tax, discounts, overhead, and other real pricing constraints before publishing a price.
Markup and margin formulas
Selling price = cost ÷ (1 − margin ÷ 100); profit = selling price − cost; markup % = (profit ÷ cost) × 100.
- The calculator treats the entered margin as a share of the final selling price, not as a share of cost.
- A target margin of 40% therefore requires a price that leaves 40% of the selling price as profit before other adjustments.
Worked examples
40% margin on a $50 cost
A product costs $50 and the target profit margin is 40%.
$50 ÷ (1 − 0.40) = $83.33; profit ≈ $33.33; markup ≈ 66.67%.
The calculated selling price is about $83.33.
20% margin on a $25 cost
A product costs $25 and the target margin is 20%.
$25 ÷ 0.80 = $31.25.
The calculated selling price is $31.25 before other business adjustments.
Understanding the result
Margin is profit divided by selling price, while markup is profit divided by cost. The same product can have a 40% margin and a 66.7% markup.
A pricing calculator cannot account automatically for every real-world cost. Consider payment fees, shipping, returns, taxes, discounts, labor, overhead, and desired contribution to fixed costs separately.
Important notes
A margin of 100% is not valid because the formula would divide by zero.
Use the same currency and unit basis throughout a pricing calculation.
Frequently asked questions
What is the difference between markup and margin?
Markup measures profit as a percentage of cost. Margin measures profit as a percentage of selling price.
How do I price for a 40% margin?
Divide cost by 1 − 0.40. For a $50 cost, that gives a selling price of about $83.33.
Does this include tax or payment fees?
No. Add those business-specific costs or pricing rules separately.
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Related calculators
- Gross Profit Calculator — Calculate gross profit and gross margin from revenue and direct costs.
- Profit Margin Calculator — Calculate profit and profit margin from sales revenue and total costs, including negative-margin scenarios.
- Customer Acquisition Cost Calculator — Calculate average customer acquisition cost from marketing and sales spend and the number of new customers gained.
- Net Profit Calculator — Estimate net profit or loss and net margin from revenue and the costs included in the calculation.
- Contribution Margin Calculator — Calculate unit contribution, contribution margin ratio and total contribution from selling price, variable cost and units sold.
- Profit per Employee Calculator — Calculate a simple profit-per-employee metric from a reporting-period profit figure and average employee count.
Related explanations
Learn the method behind the number or compare the terminology before using the calculator.
- How to Calculate ROI — Learn the return on investment formula and how to interpret profit, cost, and percentage return.
- How to Calculate Break-Even Point — Learn the break-even formula for units and revenue and understand fixed costs, price, and variable costs.
- Markup — Learn what markup means, how markup is calculated from cost and selling price, and how it differs from margin.
Markup calculator use cases
A markup calculator answers a practical pricing question: how much should be added to a cost to reach a target selling price? Enter a cost and markup percentage to estimate the price before comparing it with your market, operating costs, and desired margin.
Markup and margin are not the same percentage. Markup is calculated from cost, while margin is calculated from selling price. Keeping those two bases separate prevents a common pricing mistake.
Read the markup definition, explore the break-even guide, or browse business-work calculators.
This page provides a calculation tool plus explanatory information so you can understand what the result means and when the underlying method may not fit your situation.