What's the difference between margin and markup?

Margin is profit as a percentage of the selling price; markup is profit as a percentage of the cost. They're always different numbers for the same sale (except at 0%).

Only if the cost is zero. A priced item (cost > 0) can approach 100% margin but never reach or exceed it.

Is this financial advice?

No — this is a general calculation based on the numbers you enter, not financial, tax or pricing advice for your specific business.

Margin Calculator

Calculate profit margin and markup from a cost and selling price, or work backward from a target margin to the price you need to charge.

Cost per unitSelling price per unit

Profit per unit

40.00

Margin (% of price)

40.00%

Markup (% of cost)

66.67%

Margin and markup are easy to mix up: margin is profit as a percentage of the selling price; markup is profit as a percentage of the cost. A $40 profit on a $60 cost is a 40% margin but a 66.7% markup.

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How It Works

Choose whether you know the cost and price, or the cost and a target margin, then enter the values.

Margin % = (Price − Cost) ÷ Price × 100. Markup % = (Price − Cost) ÷ Cost × 100.

Example

A product costs $60 and sells for $100: that's a $40 profit, a 40% margin, and a 66.7% markup — the same $40 profit expressed two different ways.

Frequently Asked Questions

What's the difference between margin and markup?: Margin is profit as a percentage of the selling price; markup is profit as a percentage of the cost. They're always different numbers for the same sale (except at 0%).
Can margin be 100%?: Only if the cost is zero. A priced item (cost > 0) can approach 100% margin but never reach or exceed it.
Is this financial advice?: No — this is a general calculation based on the numbers you enter, not financial, tax or pricing advice for your specific business.