Find profit, gross margin and markup from cost and price, or the price that hits a target margin. Rounds prices up so the margin never falls short.
A 50% markup is not a 50% margin. It is a 33.33% margin, and pricing a product as if the two were the same is one of the most common ways a small shop ends up working for less than it planned. Margin divides profit by the selling price. Markup divides the same profit by the cost.
This calculator shows both from whatever pair of numbers you have. The page opens on a hand-poured candle with a unit cost of$18.50, a selling price of $32.00 and250 units. That gives $13.50 profit a unit, a 42.19% gross margin, a 72.97% markup and $3,375.00 profit across the batch. Load Sample then steps through a target-margin price, a markup price, a supplier cost ceiling and a clearance item sold at a loss.
The Units field turns the per-unit figures into revenue, total cost and total profit for a batch. OpenMargin to markup reference under the results for a table of common margins, the markup each one needs and the price it puts on a $10 cost.
To convert between the two percentages, markup = margin ÷ (100 − margin) and margin = markup ÷ (100 + markup), both as percentages. That is why margin can never reach 100% while markup has no ceiling. A target of 100% stops with“Target margin must be from 0% up to, but not including, 100%. At 100% the price would have to be infinite.”
A solved price is rounded up, never to the nearest cent. Rounding $10.7692 down to $10.76 would leave the coffee at a 34.94% margin, under the 35% you asked for. Rounded up to $10.77 it lands at 35.00%. TheRound price up to menu can also move the price up to the next .99 or the next whole number, and the line under the results gives the margin you get at that rounded price. A solved maximum cost is rounded down for the same reason.
Profit is worked out in whole cents, so $32.00 minus $18.50 is exactly $13.50 with no stray fractions. A cost of 0 gives a 100% margin and no markup at all, since there is nothing to divide by. A price below cost is shown as a loss in red, with the break-even price beside it. This is gross margin only: rent, wages, shipping and card fees are not in it, so a net margin will always be lower.
What do you know?
Selling price
$32.00
Unit cost
$18.50
Profit per unit
$13.50
Gross margin
42.19%
markup 72.97%
A 72.97% markup on cost is the same as a 42.19% margin on price.
For 250 units
Revenue
$8,000.00
Total cost
$4,625.00
Total profit
$3,375.00
| Margin | Markup needed | Price on a $10 cost |
|---|---|---|
| 10% | 11.11% | $11.12 |
| 20% | 25.00% | $12.50 |
| 25% | 33.33% | $13.34 |
| 30% | 42.86% | $14.29 |
| 40% | 66.67% | $16.67 |
| 50% | 100.00% | $20.00 |
| 60% | 150.00% | $25.00 |
| 75% | 300.00% | $40.00 |