Money
Markup Calculator
Last updated: June 19, 2026
A markup calculator is a business finance tool used to calculate the selling price, gross profit, and markup percentage of a product or service. The markup percentage is the ratio of gross profit to the cost of purchasing or producing the item, which differs from profit margin (the ratio of profit to selling price). The calculator computes selling prices from cost and markup inputs, and can work in reverse to determine the cost when selling price and profit targets are known. Retailers, wholesalers, and entrepreneurs use this tool to set sustainable pricing strategies.
Enter cost and a markup percentage to compute selling price, gross profit, and margin. Or switch to reverse mode to start from cost and selling price and find the implied markup and margin.
Quick Answer
Calculate the selling price, profit, and profit margin from your cost and markup. Enter any two values to find the others.
What it costs you, before markup. · e.g. 50.00
Percentage added on top of cost. · e.g. 40
Selling price
$70.00
40% markup · 28.57% margin
Examples
$50 cost at 40% markup
= $70 sale · 28.6% margin
$200 cost at 100% markup
= $400 sale · 50% margin
Reverse: $50 cost, $80 sale
= 60% markup · 37.5% margin
How it works
Markup is the percentage you add to cost. Margin is the percentage of the selling price that's profit. They're two ways of describing the same dollar amount.
Selling price · cost × (1 + markup ÷ 100)
Markup % · (profit ÷ cost) × 100
Margin % · (profit ÷ selling price) × 100
What is a markup calculator?
A markup calculator is an essential business tool used to determine the selling price of a product or service. By taking your wholesale cost and adding a specific markup percentage, it computes the final price you should charge customers to hit your target profit. In addition to the retail price, it outputs the total gross profit in dollars and the resulting gross profit margin.
How to calculate markup (step-by-step)
Calculating a markup is straightforward when you know your cost of goods sold (COGS) and your desired markup rate. Follow these steps:
- Convert your markup percentage into a decimal by dividing it by 100 (e.g., 25% becomes 0.25).
- Add 1 to that decimal number (e.g., 1 + 0.25 = 1.25).
- Multiply your baseline product cost by this multiplier to find your selling price.
- Subtract the original cost from the selling price to find your gross profit in dollars.
For example, if your cost is $40 and you want a 50% markup, you calculate: $40 × 1.50 = $60 selling price.
Markup vs. Margin: Understanding the difference
Though many people use the terms interchangeably, markup and profit margin represent different financial ratios:
- Markup: Measures profit relative to cost. It answers: "How much extra did I add to my original cost?"
- Margin (Gross Margin): Measures profit relative to the selling price. It answers: "What percentage of the final sale is profit?"
Because margin compares profit to a larger denominator (the selling price), the margin percentage is always lower than the markup percentage. For instance, a 100% markup (doubling your money) results in a 50% profit margin.
Worked example: Calculating price from cost and markup
Let's walk through an example where a retailer buys an item for $80 and decides to apply a 35% markup:
- Wholesale Cost: $80.00
- Markup Rate: 35%
- Selling Price Calculation: $80.00 × (1 + 0.35) = $80.00 × 1.35 = $108.00
- Gross Profit: $108.00 − $80.00 = $28.00
- Implied Profit Margin: ($28.00 ÷ $108.00) × 100 = 25.93%
Common mistakes when calculating markup
- Targeting margin but using markup math: Entering a 30% markup expecting a 30% profit margin. A 30% markup actually yields a 23.1% margin, which could lead to underpriced items and smaller profits than planned.
- Ignoring hidden costs in the baseline cost: Only factoring in the invoice cost of the item while ignoring inbound shipping, packaging materials, and merchant transaction fees. Your true cost should encompass all expenses required to get the item ready for sale.
- Confusing markup with sales tax: Applying your markup to a tax-inclusive figure or neglecting to account for local sales tax when pricing services.
Related tools
- Margin calculator for the same dollar profit framed as a percent of selling price (and to find the selling price for a target margin).
- Percentage calculator for the three standard percent questions used in everyday pricing math.
- All money calculators.
Related Calculators
More tools from Money
Frequently asked questions
Markup is profit as a percent of cost. Margin is profit as a percent of selling price. A 50% markup is a 33% margin. They describe the same dollar profit but answer different questions: markup says "how much I added to cost," margin says "how much of the sale is profit."
Margin is usually more useful when comparing products or businesses, because it's directly comparable across different cost structures. Markup is the formula most people use day-to-day at the register.
Markup % = margin % ÷ (1 − margin %). For a 40% margin, the markup is 0.40 ÷ 0.60 ≈ 66.7%. The reverse mode of this calculator does the inverse — enter cost and the selling price you want, and it tells you both the markup and the margin.
However you define cost is what flows through. If your cost is the wholesale price plus inbound shipping plus packaging, use that. Margins and markups stay consistent as long as you're consistent about what "cost" includes.
A standard retail markup is often 100%, also known as "keystone pricing." This means an item that costs $50 to buy wholesale is priced at $100 for retail sale. However, actual markups vary wildly by industry, ranging from 10% in grocery stores to over 300% in cosmetics or apparel.
Yes, markup can be any positive percentage. A 200% markup means the product is priced at three times its cost (e.g., $10 cost sold for $30). Margins, however, can never exceed 100% because profit can never be higher than the total selling price.
Markup directly determines your gross profit. The formula for gross profit is: Gross Profit = Cost × (Markup ÷ 100). Higher markups result in larger profits per unit, but if set too high, they can reduce sales volume. Balancing markup and demand is key to maximizing total revenue.
Margin is always lower than markup because the denominator in the margin formula is the selling price (which is cost plus profit), whereas the denominator in the markup formula is the cost alone. Since the selling price is always larger than the cost, the margin percentage is always smaller.
Related calculators
Money
Margin Calculator
Calculate profit margin, gross margin, operating margin, and net margin from cost and revenue. Find the selling price for a target margin or the maximum cost for a target margin. Calculate margin in one step or back into target prices. Works as a margin calculator, profit margin calculator, gross margin calculator, margin percentage calculator, net margin calculator, operating margin calculator, target margin calculator, and cost and revenue margin calculator. Also computes markup for comparison and shows the selling price from margin.
Money
RMD Calculator
Estimate your required minimum distribution from a traditional IRA, SEP IRA, SIMPLE IRA, or traditional 401k using the IRS Uniform Lifetime Table effective for distribution years beginning on or after January 1, 2022. Works as an RMD calculator, required minimum distribution calculator, IRA RMD calculator, 401k RMD calculator, retirement distribution calculator, RMD table calculator, and minimum withdrawal calculator, with a reference for the life expectancy factor at each age.
Money
Roth IRA Calculator
Project the future value of a Roth IRA from current balance, annual contribution, time horizon, and expected return.