Margin and Markup Calculator
Convert between profit margin and markup percentage instantly. Enter cost and selling price, or use a target margin or markup to calculate the other values. Understand the difference between margin and markup for smarter pricing decisions.
Enter Values
What you pay for the product or service
Margin = (Revenue − Cost) / Revenue
The price you charge your customer
Results
of revenue
of cost
per unit sold
Revenue / Cost ratio
Markup is always higher than margin for the same profit
Margin ↔ Markup Quick Reference
| Margin | Markup | Multiplier |
|---|---|---|
| 10% | 11.11% | 1.11x |
| 15% | 17.65% | 1.18x |
| 20% | 25% | 1.25x |
| 25% | 33.33% | 1.33x |
| 30% | 42.86% | 1.43x |
| 33.33% | 50% | 1.5x |
| 40% | 66.67% | 1.67x |
| 50% | 100% | 2x |
| 60% | 150% | 2.5x |
| 75% | 300% | 4x |
What Is Margin vs Markup?
Margin and markup are two ways to express the relationship between cost and selling price, but they use different bases for the calculation. Understanding the distinction is critical for pricing, profitability analysis, and financial reporting.
Profit margin (or gross margin) is the percentage of revenue that is profit. It answers the question: “Of every dollar I collect, how many cents are profit?”
Markup is the percentage added on top of cost to arrive at the selling price. It answers: “How much did I add to my cost?”
Margin and Markup Formulas
Margin (%) = ((Revenue − Cost) / Revenue) × 100Markup (%) = ((Revenue − Cost) / Cost) × 100Markup (%) = Margin / (1 − Margin)Margin (%) = Markup / (1 + Markup)How to Use This Margin and Markup Calculator
- Enter your cost price: This is the amount you pay for the product, raw materials, or service delivery.
- Choose your mode: Select “Calculate from Margin” if you know your target profit margin, or “Calculate from Markup” if you know your target markup percentage.
- Enter margin or markup: Type your target percentage, or use an industry preset for common margins.
- Or enter revenue directly: If you already know both cost and selling price, enter them to see the resulting margin and markup.
- Read your results: See profit margin, markup percentage, gross profit, revenue, and the price multiplier instantly.
Why Margin and Markup Matter
Confusing margin with markup is one of the most common pricing mistakes in business. A 50% markup does not produce a 50% margin — it produces a 33.3% margin. This difference can significantly impact profitability, especially at scale.
Set selling prices that meet your profitability targets. Know exactly what margin you earn at any price point.
Gross margin is a key metric on income statements. Investors and analysts use it to evaluate business health.
Quickly convert between margin and markup during supplier or client negotiations to protect your bottom line.
Compare your margins against industry benchmarks to identify opportunities for improvement.
Margin vs Markup: A Common Example
Suppose you buy a product for $50 and sell it for $100:
- Profit: $100 − $50 = $50
- Margin: $50 / $100 = 50% (profit as a share of revenue)
- Markup: $50 / $50 = 100% (profit as a share of cost)
The same $50 profit is expressed as 50% margin or 100% markup. Markup will always be a larger number than margin for the same transaction because it divides by the smaller base (cost instead of revenue).
Typical Margins by Industry
| Industry | Typical Margin | Equivalent Markup |
|---|---|---|
| Grocery / Supermarket | 20–30% | 25–43% |
| Retail Clothing | 40–60% | 67–150% |
| Restaurants | 55–65% | 122–186% |
| E-commerce | 30–50% | 43–100% |
| SaaS / Software | 70–90% | 233–900% |
| Wholesale / Distribution | 10–20% | 11–25% |
FAQs
What is the difference between margin and markup?
Margin is the percentage of revenue that is profit (Profit / Revenue × 100), while markup is the percentage added on top of cost (Profit / Cost × 100). For the same transaction, markup is always a larger number than margin because it divides by the smaller base (cost). For example, buying at $50 and selling at $100 gives a 50% margin but a 100% markup.
How do I convert margin to markup?
To convert margin to markup, use the formula: Markup = Margin / (1 − Margin). For example, a 40% margin (0.40) converts to 0.40 / (1 − 0.40) = 0.40 / 0.60 = 0.6667, or 66.67% markup. You can also use the quick reference table in our calculator for common conversions.
How do I convert markup to margin?
To convert markup to margin, use the formula: Margin = Markup / (1 + Markup). For example, a 100% markup (1.00) converts to 1.00 / (1 + 1.00) = 1.00 / 2.00 = 0.50, or 50% margin.
Why is a 50% markup not the same as a 50% margin?
Because they use different bases. A 50% markup means you add 50% of cost to the price. If cost is $100, selling price is $150 and profit is $50. But margin divides profit by revenue: $50 / $150 = 33.3%. The same profit is 50% of cost (markup) but only 33.3% of revenue (margin).
What is a good profit margin for my business?
It varies by industry. Grocery stores typically operate at 20–30% margins, retail clothing at 40–60%, restaurants at 55–65%, e-commerce at 30–50%, and SaaS companies at 70–90%. Compare your margin to industry benchmarks to assess performance.
Is this margin and markup calculator free?
Yes, this margin and markup calculator is completely free to use with no registration required. All calculations happen instantly in your browser — no data is stored or sent to any server.
Price Smarter, Trade Smarter with Pineify
Now that you understand your margins, take the next step. Use Pineify to build custom Pine Script indicators and automated trading strategies that help you track profitability and execute trades with precision on TradingView.