FREE TOOL
Markup and Margin Calculator
Enter any two of cost, selling price, markup, and margin, and the calculator works out the other two and the gross profit. The two numbers you typed last drive the result; the others are marked as calculated.
Selling price
$6.00
$2.00 gross profit on each sale
- Cost
- $4.00
- Gross profit
- $2.00
- Markup
- 50%
- Margin
- 33.3%
The math
Markup = $2.00 ÷ $4.00 = 50%
Margin = $2.00 ÷ $6.00 = 33.3%
Price a product for wholesaleMarkup and Margin Formulas
Markup measures profit against what the item cost you. Margin measures the same profit against the selling price. Both start from gross profit, the selling price minus the cost.
- Gross profit = selling price − cost
- Markup = gross profit ÷ cost
- Margin (gross margin) = gross profit ÷ selling price
- Price from a markup = cost × (1 + markup)
- Price from a margin = cost ÷ (1 − margin)
- Markup to margin = markup ÷ (1 + markup); margin to markup = margin ÷ (1 − margin)
Example: a jar of sauce that costs $4.00 to make, sold at a 50% markup, sells for $6.00. The gross profit is $2.00, which is a 33.3% margin.
Markup vs Margin
The same sale always shows a higher markup than margin, because markup divides the profit by the smaller number. A 50% markup is a 33.3% margin, and a 100% markup is a 50% margin. Mixing them up is costly: a business that adds 30% to its costs, believing it is earning a 30% margin, is earning 23.1%.
Use margin when a buyer quotes one. Distributors and stores state what they keep as a margin on their selling price, so the wholesale price calculator works in margins throughout.
| Markup on cost | Gross margin | Price for a $10.00 cost |
|---|---|---|
| 10% | 9.1% | $11.00 |
| 20% | 16.7% | $12.00 |
| 25% | 20% | $12.50 |
| 30% | 23.1% | $13.00 |
| 40% | 28.6% | $14.00 |
| 50% | 33.3% | $15.00 |
| 60% | 37.5% | $16.00 |
| 75% | 42.9% | $17.50 |
| 100% | 50% | $20.00 |
| 125% | 55.6% | $22.50 |
| 150% | 60% | $25.00 |
| 200% | 66.7% | $30.00 |
| 250% | 71.4% | $35.00 |
| 300% | 75% | $40.00 |
Margin to Markup Table
When you know the margin you need, this is the markup that gets you there.
| Target margin | Markup needed | Price for a $10.00 cost |
|---|---|---|
| 10% | 11.1% | $11.11 |
| 15% | 17.6% | $11.76 |
| 20% | 25% | $12.50 |
| 25% | 33.3% | $13.33 |
| 30% | 42.9% | $14.29 |
| 35% | 53.8% | $15.38 |
| 40% | 66.7% | $16.67 |
| 45% | 81.8% | $18.18 |
| 50% | 100% | $20.00 |
| 55% | 122.2% | $22.22 |
| 60% | 150% | $25.00 |
| 65% | 185.7% | $28.57 |
| 70% | 233.3% | $33.33 |
| 75% | 300% | $40.00 |
| 80% | 400% | $50.00 |
Cost-Plus Pricing for Food Businesses
Cost-plus pricing sets the price at the full cost plus a markup. It works only when the cost is complete: ingredients, packaging, the labor to make and pack the order, and the delivery.
- A bakery’s wholesale order. Two dozen cookies for a café cost $9.00 to make and pack and sell for $18.00: a 100% markup and a 50% margin.
- A case of sauce. Twelve jars at $4.00 each sell to a shop for $72.00 at a 50% markup, $24.00 of gross profit on the case.
- Catering per head. A lunch that costs $14.00 a person in food and labor, priced for a 30% margin, is $20.00 a head, a 42.9% markup.
The food cost calculator adds up a recipe’s cost per portion, and the wholesale price calculator adds what each delivery costs per case. As a guide for packaged food, the Montana Department of Agriculture puts the ideal gross margin for specialty foods at 40% to 60% (Selling to Grocery Stores: Pricing), which is a markup of 66.7% to 150%.
Selling to stores and cafés? See courier service for wholesalers and the delivery cost calculator for a courier price on a route.
Figures checked against their sources on .
Price the Delivery Too
Enter a pickup and a dropoff to see what a courier charges, so delivery goes into your cost.
- A price range in about a minute
- SUVs, minivans, and cargo vans
- One-off, scheduled, or repeating routes
MARKUP FAQ
Markup and Margin Questions
How do you calculate markup?
Subtract the cost from the selling price and divide by the cost. An item that costs $4.00 and sells for $6.00 has a markup of ($6.00 − $4.00) ÷ $4.00 = 50%.
What is the difference between markup and margin?
Both measure the same profit. Markup divides it by the cost; margin divides it by the selling price. So a 100% markup is a 50% margin.
Is a 50% markup the same as a 50% margin?
No. A 50% markup on a $10.00 cost gives a $15.00 price and a 33.3% margin. A 50% margin needs a $20.00 price, which is a 100% markup.
What is the gross margin formula?
Gross margin = (selling price − cost) ÷ selling price. To find the price that gives a target margin, divide the cost by one minus the margin: a $10.00 cost at a 40% margin sells for $10.00 ÷ 0.6 = $16.67.
What is cost-plus pricing?
Setting the price at your full cost plus a fixed markup. It guarantees every sale covers its cost, as long as the cost includes everything: ingredients, packaging, labor, and delivery.
What markup should a food business use?
It depends on the channel. For packaged specialty food, the Montana Department of Agriculture’s grocery guide puts the ideal gross margin at 40% to 60%, which is a 66.7% to 150% markup on your cost.
MORE FREE TOOLS
Related Tools and Guides
Put the markup to work on a full price.
- Wholesale Price CalculatorYour wholesale price, the distributor’s and store’s margins, and the shelf price.→
- Food Cost CalculatorCost a recipe per portion and price it at your target food cost.→
- Courier Delivery Cost CalculatorA courier’s price range for your route, from a pickup and a dropoff address.→
Keep Delivery Costs Predictable
Couriers priced per route, for one-off orders and standing weekly deliveries.