Mark-Up Calculator
Calculate the correct selling price, gross profit, and gross margin based on your product cost and desired markup percentage.
Understanding Markup vs. Margin
In retail and business finance, markup and margin are often confused, but they are entirely different mathematical concepts. Understanding the difference is critical to pricing your products correctly.
The Difference
Markup is the percentage added to your cost to determine the selling price. Margin is the percentage of the selling price that is profit.
If an item costs $100 and you sell it for $150, your markup is 50% ($50 is 50% of $100). However, your gross margin is 33.3% ($50 is 33.3% of $150).
Worked Example
- Product Cost: $100
- Desired Markup: 50%
- Profit Amount = $100 * 0.50 = $50
- Selling Price = $150
- Gross Margin = ($50 / $150) * 100 = 33.33%
Frequently Asked Questions
Can margin ever be 100%?
No, margin can approach 100% (if the product costs essentially $0), but it can never reach it. Markup, however, can be infinite (e.g., 500% or 1000% markup).
Disclaimer: This calculator is for educational and informational purposes only. It is not a substitute for professional financial advice. Results are estimates based on the information provided and may not reflect actual outcomes. Please consult with a qualified financial advisor, accountant, or tax professional before making any financial decisions. Past performance does not guarantee future results.