How it works
Margin is profit as a share of the selling price. Markup is profit as a share of cost. When a sale makes a profit, markup is the larger number.
profit = price − cost
margin % = profit × 100 ÷ price
markup % = profit × 100 ÷ cost
price = cost × 100 ÷ (100 − margin %)
cost = price × (100 − margin %) ÷ 100
markup % = margin % × 100 ÷ (100 − margin %)
Worked example
You buy a lamp for $60.00 and sell it for $100.00.
- 1Profit100.00 − 60.00 = $40.00
- 2Margin40.00 × 100 ÷ 100.00 = 40.00%
- 3Markup40.00 × 100 ÷ 60.00 = 66.67%
| Margin | Markup | Price at $60.00 cost |
|---|---|---|
| 20% | 25.00% | $75.00 |
| 25% | 33.33% | $80.00 |
| 30% | 42.86% | $85.71 |
| 40% | 66.67% | $100.00 |
| 50% | 100.00% | $120.00 |