Calculate your selling price from cost and markup percentage — with gross margin, profit breakdown, and margin conversion in one click.
Markup is the percentage you add to your cost price to arrive at a selling price. This calculator uses two core formulas depending on the mode you choose:
Mode 1 – Calculate selling price:
Selling Price = Cost × (1 + Markup% / 100)
Profit = Selling Price − Cost
Gross Margin = (Profit / Selling Price) × 100
Mode 2 – Find the markup:
Markup% = ((Selling Price − Cost) / Cost) × 100
Gross Margin = ((Selling Price − Cost) / Selling Price) × 100
Gross margin is always shown alongside markup so you can see what share of the selling price is profit — not just how much you added to the cost.
These two terms are frequently confused, but they're calculated differently and produce different numbers for the same transaction.
Markup expresses the profit as a percentage of cost. It tells you how much you added on top of what you paid.
Gross margin expresses the profit as a percentage of selling price. It tells you how much of each dollar in revenue is profit.
A concrete example: An item that costs $100 and sells for $150 has a 50% markup but only a 33.3% gross margin. Markup is always a higher number than margin for the same transaction.
| Markup | Margin | Multiplier |
|---|---|---|
| 10% | 9.1% | 1.10× |
| 25% | 20.0% | 1.25× |
| 50% | 33.3% | 1.50× |
| 75% | 42.9% | 1.75× |
| 100% | 50.0% | 2.00× |
| 150% | 60.0% | 2.50× |
| 200% | 66.7% | 3.00× |
| 300% | 75.0% | 4.00× |
| 500% | 83.3% | 6.00× |
Conversion formula: Margin = Markup / (1 + Markup). Markup = Margin / (1 − Margin).
How much you should mark up depends on your industry, competition, and operating costs. Here are some common reference points:
Grocery: 10–15% markup. Thin margins compensated by high volume.
Clothing & fashion: 100–300%. Seasonal variation and brand value drive higher markups.
Electronics: 8–25%. Strong price competition and transparent pricing limit markups.
Restaurants (food): 200–300%. Covers labour, rent, waste, and operations — yet typical net profit is still only 3–10%.
Restaurants (beverages): 300–500%. Cocktails and wine carry especially high markups.
Consulting / services: 150–300%. Varies by specialisation and market positioning.
Jewellery: 50–100%. Varies widely between mass-produced and handmade pieces.
These are industry averages and vary significantly between individual businesses, regions, and business models.
Choosing a markup isn't just about covering costs — it's about setting a price the market will accept while maintaining healthy profitability over time. Three factors should guide your decision:
1. Cover all costs, not just the purchase price. Many businesses forget shipping, packaging, shrinkage, storage, and labour when calculating cost price. A markup that looks generous can produce zero profit if the cost base is incomplete.
2. Check the competition. Use industry benchmarks as a starting point, but research what comparable players actually charge. If you're priced well above average without a clear value proposition, you'll lose customers.
3. Revise regularly. Purchase prices change, and your markup should adjust accordingly. Businesses that update pricing quarterly maintain margins better than those that set a price and forget it.
Markup is the percentage increase you apply to the cost price. Profit is the actual dollar amount you keep — selling price minus cost. A 50% markup on an item that costs $200 gives you a profit of $100.
Because markup is calculated from the cost (a smaller number), while margin is calculated from the selling price (a larger number). The same profit yields a higher percentage when divided by the smaller base.
Yes. A 100% markup means you're doubling the cost price. A 300% markup means the selling price is four times the cost. Industries like restaurants and jewellery regularly operate with markups well above 100%.
Gross margin cannot exceed 100%, but it can reach exactly 100% if the cost price is zero (for example, when selling digital products with no marginal cost). In practice, a margin of 80% means you keep 80 cents of every dollar in revenue.
Markup to margin: Margin = Markup / (1 + Markup). Margin to markup: Markup = Margin / (1 − Margin). Example: 50% markup = 0.5 / 1.5 = 33.3% margin.
Keystone pricing means doubling the wholesale price — a markup of exactly 100%. This gives a gross margin of 50% and is a common rule of thumb in parts of the retail industry.
This calculator provides estimates based on the numbers you enter. It does not account for VAT, shipping costs, shrinkage, or other indirect costs unless you include them in the cost price. Results should not be used as the sole basis for pricing decisions. Consult an accountant or financial advisor for tailored analysis.