Markup Calculator
Calculate your product markup, determine the right selling price, and understand the relationship between markup and profit margin.
Calculate Your Markup
Enter your product cost and desired markup percentage.
Your Results Will Appear Here
Enter your cost price and markup percentage to calculate your selling price and gross profit margin.
What Is Markup?
Markup is the amount added to the cost of a product or service to determine its selling price. It is usually expressed as a percentage of the original cost.
Businesses use markup to establish selling prices, cover expenses, and generate profit.
Markup Formula
Selling Price = Cost Price + Markup Amount
Gross Profit Margin = (Markup Amount ÷ Selling Price) × 100
Markup Calculation Example
Suppose you purchase a product for $100 and apply a 50% markup.
- Cost Price: $100
- Markup Percentage: 50%
- Markup Amount: $100 × 50% = $50
- Selling Price: $100 + $50 = $150
- Gross Profit Margin: ($50 ÷ $150) × 100 = 33.33%
Your selling price is $150, with a markup amount of $50 and a gross profit margin of 33.33%.
Markup vs. Profit Margin
Markup and profit margin both measure profitability, but they use different reference values. Markup compares the added amount with the original cost, while gross profit margin compares that amount with the selling price.
For example, a 50% markup does not mean a 50% gross profit margin. When a product costs $100 and sells for $150, the markup is 50%, but the gross profit margin is 33.33%.
How to Convert Markup to Profit Margin
You can convert a markup percentage into a gross profit margin using this formula:
The following table shows how different markup percentages translate into gross profit margins:
| Markup Percentage | Gross Profit Margin |
|---|---|
| 10% | 9.09% |
| 25% | 20.00% |
| 50% | 33.33% |
| 75% | 42.86% |
| 100% | 50.00% |
What Does the Profit Margin Result Include?
The gross profit margin shown by this calculator is based only on the difference between the selling price and the cost price you enter. It does not deduct operating expenses, marketing costs, employee expenses, taxes, or other additional business costs.
To estimate net profit margin, you must also account for all relevant business expenses. This calculator does not calculate net profit margin.
Frequently Asked Questions
How do I calculate markup percentage?
Subtract the cost price from the selling price, divide the difference by the cost price, and multiply by 100.
What is a 50% markup?
A 50% markup means adding an amount equal to half of the original cost. For example, a product costing $100 would have a selling price of $150.
Is markup the same as profit margin?
No. Markup is calculated using cost as the reference, while profit margin is calculated using selling price as the reference.
Can markup be zero?
Yes. A zero markup means the selling price equals the original cost, resulting in zero gross profit before other expenses.