Markup vs margin (simple definitions)
Markup is profit as a percent of cost. Margin is profit as a percent of sell price. A 50% markup is only a 33.3% margin. Mixing them up underprices or overprices work.
Nine tools on this page
- Markup → price — cost and markup % to sell price.
- Margin → price — cost and target margin % to sell price.
- Markup ↔ margin — convert percentages either way.
- Break-even — units to cover fixed costs (optional target profit).
- Target profit — cost + desired profit/unit → price, margin, markup.
- After discount — list − % off → sale price, margin, profit.
- Unit total — price/cost × qty → total profit and margin.
- Markup from price — (price − cost) ÷ cost (+ margin %).
- Cost from markup — price ÷ (1 + markup %).
- Revenue need — profit goal ÷ margin %.
Formulas
- Price from markup:
price = cost × (1 + markup) - Price from margin:
price = cost ÷ (1 − margin) - Margin from markup:
margin = markup ÷ (1 + markup) - Markup from margin:
markup = margin ÷ (1 − margin) - Break-even units:
(fixed + target profit) ÷ (price − variable cost)
Popular searches
- Markup vs margin calculator
- How to calculate selling price from cost
- Convert markup to margin
- Break-even point units calculator
FAQ
Is markup the same as margin?
No. Markup is based on cost; margin is based on sell price. 100% markup equals 50% margin.
What markup equals a 30% margin?
About 42.86% markup. Use the convert tab: margin 30 → markup.
How do I calculate break-even units?
Divide fixed costs by contribution margin per unit (price minus variable cost). Add target profit to fixed costs if you want units to hit a profit goal.
Is my data private?
Yes. All math runs in your browser. Nothing is uploaded.
What is the difference between markup and margin?
Markup is profit divided by cost. Margin is profit divided by selling price. 50% markup is not 50% margin — this tool converts both ways.
How do break-even units relate to margin?
Break-even units need contribution per unit (price minus variable cost) and fixed costs. Higher margin per unit usually means fewer units to break even.
How do I price for a 40% margin?
Margin is profit over price. For a target margin, price is cost divided by (1 − margin). Use the price-from-margin tools instead of adding 40% of cost (that is markup).
Can I use this for wholesale and retail?
Yes. Run cost-to-wholesale and wholesale-to-retail as separate steps with their own margin or markup targets.
Why do people confuse markup with margin?
Both use profit but different denominators. Markup ÷ cost; margin ÷ price. A 50% markup equals about 33% margin — the converter shows that instantly.
How do discounts interact with margin targets?
A discount lowers price and margin unless cost also falls. Recalculate margin after the promo price, or stack with a discount calculator before you approve a sale.