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Small business / Free tool

Margin and markup calculator

Understand gross profit, compare margin with markup or calculate a target selling price.

Your numbersLive result
Choose the question you want to answer.
Display only. No currency conversion.
Required. Greater than 0. Use up to 6 decimal places, without commas or currency symbols.
Required. Greater than 0. Use up to 6 decimal places, without commas or currency symbols.

Example values are prefilled. Change any number to calculate.

Gross profit per unit

£40.00

Profit margin
40%
Markup on cost
66.666667%
Selling price
£100.00

Margin uses selling price as its base; markup uses cost. Gross profit here excludes overheads, taxes and any costs you have not included. A rounded target selling price can slightly change the achieved margin.

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The working behind the answer

How to use this calculator

Choose whether you already know a selling price or want to calculate one from a target. Include the per-unit costs that matter to your comparison. A selling price below cost will show a loss. Costs and prices must be greater than zero so both percentages can be defined.

The formula

I know cost and selling price

Gross profit = price − cost; margin = profit ÷ price × 100; markup = profit ÷ cost × 100

Find price from target margin

Selling price = cost ÷ (1 − target margin ÷ 100)

Find price from target markup

Selling price = cost × (1 + markup ÷ 100)

A worked example

Buy or make an item for £60 and sell it for £100: gross profit is £40. Margin is £40 ÷ £100 = 40%. Markup is £40 ÷ £60 ≈ 66.67%. The same profit has two different percentages because the bases differ.

Good to know

This is gross profit on the entered unit economics, not net profit. It does not automatically deduct overheads, taxes, shipping or payment fees. Target prices are displayed to two decimal places; rounding the actual price may slightly change the achieved margin.

Common questions

Does 50% markup mean 50% margin?

No. An item costing £10 with 50% markup sells for £15. Its £5 profit is one third of the selling price, so its margin is about 33.33%.

Why can’t I set a 100% target margin?

With a positive cost, a 100% margin would require the cost to be zero relative to a finite selling price. The target-price formula cannot produce that result.