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Markup Calculator

Turn a cost and a markup percentage into a selling price, with the profit and the gross margin it gives.

By PriceAndProfit Editorial Updated

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How it works

Price = Cost × (1 + Markup)

Markup is the amount added on top of the cost, expressed as a percentage of the cost. A $40 item with a 75% markup sells for $40 × 1.75 = $70, leaving $30 of profit. Because margin is measured against the higher selling price, that profitable item has a 42.9% margin, less than its markup. At zero profit both ratios are zero.

Worked examples
CostMarkupPriceProfitMargin
$12.50 30% $16.25 $3.75 23.1%
$25.00 100% $50.00 $25.00 50.0%
$40.00 75% $70.00 $30.00 42.9%

Markup is convenient when you price from a supplier invoice: one percentage applied to every cost. If you think in terms of the share of each sale you keep, use margin instead — and convert with margin = markup ÷ (1 + markup).

Markup on purchase price vs full cost

The cost you enter decides what the markup has to pay for. Suppose an item costs $18 from the supplier, $2 to bring in and $1 to pack, $21 in all. A 60% markup on the $18 purchase price gives $28.80; after the full $21 cost, $7.80 is left, a 27.1% margin. The same 60% markup on the full $21 cost gives $33.60, $12.60 of profit and a 37.5% margin. Neither is wrong, but the first quietly pays shipping and packaging out of the markup.

Same 60% markup, two cost bases (hypothetical)
Cost baseCost marked upPriceProfit after $21 full costMargin
Purchase price only $18.00 $28.80 $7.80 27.1%
Full landed cost $21.00 $33.60 $12.60 37.5%

Finding the markup from a price

Markup = (Price − Cost) ÷ Cost

If you already know both prices — a competitor sells what you buy for $25 at $45 — the markup is ($45 − $25) ÷ $25 = 80%, and the margin is $20 ÷ $45 = 44.4%. Common conversions: a 25% markup is a 20% margin, 50% is 33.3%, 100% is 50%, 150% is 60% and 200% is 66.7%. The markup vs margin chart lists every step from 10% to 300%.

One markup for every item works only when the extra costs of a sale grow with the price. Costs that are fixed per order do not: a $3 packing and fee charge is 30% of a $10 item but only 3% of a $100 item. A single 50% markup then leaves the cheap item with $5 of gross profit and $2 after the order cost, while the expensive one keeps $47. Add per-order costs to the cost before marking up, or set a minimum dollar profit per order alongside the percentage.

Frequently asked questions

How do I calculate markup from cost and selling price?

Subtract the cost from the price and divide by the cost. A $25 item sold for $45 has a $20 markup, which is 80% of the cost.

What markup gives a 50% margin?

A 100% markup — selling at double the cost. For a 40% margin you need a 66.7% markup, for 60% a 150% markup.

Should markup be based on the wholesale price or the full cost?

That is your choice, but be consistent. Applying markup to the purchase price alone leaves shipping, packaging and fees to be paid out of the profit.

Is keystone pricing the same as a 100% markup?

Yes. Keystone means doubling the wholesale cost, which is a 100% markup and a 50% margin.

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