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Margin vs Markup Calculator

Margin and markup are not the same.

Margin is profit as a percent of price. Markup is the same profit as a percent of cost. A product costing €60 and sold at €100 makes €40 of profit. That is a 40% margin, but a 66.7% markup, because one divides by the price and the other by the cost. This calculator works out both from your numbers and converts between them.

How they differ

Same profit on top, different number underneath:

  • Margin = (price - cost) / price
  • Markup = (price - cost) / cost

Worked examples

Cost Price Margin Markup
€60.00 €100.00 40% 66.7%
€75.00 €100.00 25% 33.3%
€50.00 €100.00 50% 100%
€40.00 €120.00 66.7% 200%

Margin to markup

The same margin always maps to a higher markup:

Margin Markup
20% 25%
33.3% 50%
40% 66.7%
50% 100%
Margin 40%
Markup 66.7%
Profit €40.00

Type in either field and the other updates.

Questions people ask

What is the difference between margin and markup?

Margin is profit measured against the selling price, markup is the same profit measured against the cost. A product that costs €60 and sells for €100 makes €40 of profit either way, but that €40 is 40% of the price (margin) and 66.7% of the cost (markup). Because the base is different, the two numbers never match, and markup is always the larger of the two.

How do I convert markup to margin?

Divide the markup by 100 plus the markup, then multiply by 100. A 50% markup becomes 50 / 150 × 100 = 33.3% margin. To go the other way, divide the margin by 100 minus the margin: a 33.3% margin becomes 33.3 / 66.7 × 100 = 50% markup. The converter above does both directions for you.

Which should I use for pricing?

Use markup to set a price from a known cost, since it answers how much to add on top of what you paid. Use margin to measure profitability, since it tells you what share of each sale you keep. Confusing the two is a common way to underprice: a 40% markup only leaves a 28.6% margin, not 40%.