Enter what an item costs you and what you sell it for to see the profit, the profit margin as a percentage of the price, and the markup as a percentage of the cost.
Margin is profit as a share of the selling price; markup is profit as a share of the cost. The same profit always gives a larger markup % than margin %.
Margin and markup both describe profit, but against different bases, which is why they are easy to confuse. Profit margin is the profit divided by the selling price. Markup is the same profit divided by the cost. A product bought for 60 and sold for 100 has a 40% margin but a 66.7% markup.
Retailers often set prices by markup ("cost plus 50%") but report profitability by margin. To convert, margin = markup ÷ (1 + markup). A 50% markup is a 33.3% margin; a 100% markup is a 50% margin. Knowing both stops you under-pricing when you mean a healthy margin.
Frequently asked questions
What is the difference between margin and markup?
Margin measures profit against the selling price; markup measures the same profit against the cost. Markup % is always the larger number.
Can margin be more than 100%?
No. Because margin is profit divided by price, it approaches but never reaches 100%. Markup, divided by cost, has no upper limit.
How do I convert markup to margin?
Margin = markup ÷ (1 + markup). For example, a 25% markup is 0.25 ÷ 1.25 = 20% margin.
Does this include tax?
No — enter pre-tax figures. Sales tax or VAT is handled separately; see our reverse sales tax and VAT calculators.
Estimates for general guidance only, not financial advice.
Written by the CalcPine team · Reviewed for accuracy · Last updated 23 July 2026 · Method: margin = (price − cost)/price; markup = (price − cost)/cost.
