Margin & Markup Calculator

How margin and markup are calculated

Gross profit in dollars is simply the selling price minus the cost price. The profit margin percentage is that profit divided by the selling price.

Markup, on the other hand, is measured against the cost price: it shows how many percent has been added on top of the cost. That is why the two figures differ.

What you enter and what you get

Enter the cost price and the selling price, both excluding VAT. The result gives the gross profit in dollars, the profit margin percentage and the markup percentage.

For example, if you buy an item for ten dollars and sell it for twenty, the profit is ten dollars, but the margin and the markup are different numbers because they are calculated from different bases.

Who it is for

The calculator is useful for entrepreneurs, retailers and online sellers who price products and want to ensure a sufficient margin before setting a selling price.

A common mistake

Margin is calculated from the selling price and markup from the cost price, so they are not the same number. Mixing them up easily leads to underpricing, so be sure which figure you mean.