Markup Calculator
Calculate markup percentage from cost and price.
How to use this tool
- Enter selling price and cost in the fields above.
- Results update instantly as you type — or click Calculate.
- Read your markup and the full breakdown beneath it.
Calculate markup percentage from cost and price.
⚠ This tool provides general estimates for education only and is not financial, tax or legal advice. Figures may not reflect your situation — verify with a qualified professional.
Formula
Markup = (Selling Price − Cost) ÷ Cost × 100
Markup (%) = (Price − Cost) ÷ Cost × 100
How it works
Markup is the percentage by which a product's selling price exceeds its cost, expressed relative to that cost. This calculator subtracts the cost from the selling price to find the gross profit, then divides by the cost (not the price) and multiplies by 100. Markup is the standard basis for pricing decisions in retail and wholesale, allowing a business to set prices that cover costs and deliver a desired profit.
Because the denominator is cost rather than price, markup percentages are always higher than the equivalent profit margin percentages for the same transaction.
Worked example
- Selling price = $150; Cost = $100
- Profit = $150 − $100 = $50
- Markup = $50 ÷ $100 × 100 = 50%
Markup = 50%
Common mistakes to avoid
- Treating markup and margin as the same percentage — a 100% markup gives a 50% margin, not 100%. They use different denominators (cost vs price).
- Computing markup on selling price instead of cost, which is actually the margin formula.
- Using the markup percentage to reverse-calculate cost incorrectly: given a $100 price and 25% markup, cost is $100 / 1.25 = $80, not $100 x 0.75 = $75.
Key terms
- Markup
- The amount added to the cost of a product to determine its selling price, expressed as a percentage of cost.
- Cost basis
- The total expense incurred to acquire or produce the item; the denominator in the markup formula.
- Selling price
- The price at which a product is offered to customers; equals cost plus the markup amount.
- Margin vs markup
- Margin uses selling price as the base; markup uses cost. A 50% markup on a $100 cost gives a $150 price but only a 33.3% margin.
Frequently asked questions
- If my markup is 50%, what is my profit margin?
- Margin = Markup / (1 + Markup) = 0.50 / 1.50 = 33.3%. A 50% markup yields only a 33.3% margin.
- What markup percentage do I need for a 40% margin?
- Markup = Margin / (1 - Margin) = 0.40 / 0.60 = 66.7%. You need to mark up by 66.7% to achieve a 40% margin.
- Does markup include taxes or shipping?
- The standard markup formula uses the baseline product cost. If you need to recover shipping or taxes, add them to the cost before calculating the markup.