Markup & Margin Calculator

Markup vs. Margin: What's the Difference?

This is the most common mistake new business owners make. Markup is the percentage you add to your cost to get the selling price. Gross Margin is the percentage of the selling price that is profit.

For example, if a product costs $100 and you sell it for $150:

• Your Markup is 50% ($50 is 50% of the $100 cost).
• Your Margin is 33.3% ($50 is 33.3% of the $150 price).

Why This Matters

If you set your prices thinking your "margin" is 50%, but you actually just used a 50% markup, you will end up with less profit than you planned. Always double-check your Gross Margin to ensure your business remains profitable.