How to calculate markup
Markup is how much you add to your cost to set the selling price, expressed as a percentage of the cost. To find the price, multiply the cost by (1 plus the markup as a decimal). This calculator turns a cost and a markup into a selling price and the profit it produces.
The markup formula
Selling price = cost x (1 + markup / 100). Profit = price - cost. Markup % = (price - cost) / cost x 100.
Worked example
A product that costs 80 with a 25% markup sells for 80 x 1.25 = 100, giving a 20 profit.
Markup vs margin
Markup is measured against cost; margin is measured against the selling price, so they are never the same number. A 25% markup is a 20% margin. Mix them up and you will undercharge. Our markup vs margin guide explains the difference in full.
Frequently asked questions
What is the markup formula?
Selling price equals cost times (1 plus the markup percentage as a decimal). To find markup from prices, divide profit by cost and multiply by 100.
Is markup the same as margin?
No. Markup is a percentage of cost; margin is a percentage of the selling price. A 25% markup equals a 20% margin.
What markup should I use?
It depends on your industry, costs and competition. Many retailers use 50 to 100% on small goods; groceries run much thinner.
Does this include tax?
No. Add VAT or sales tax separately with the VAT calculator if you need a tax-inclusive price.