Markup vs Margin Calculator
See markup and margin side by side from the same cost and price. They are always different — a 50% markup is only a 33% margin — and this tool shows both at once.
Cost & Price
Profit per Unit
₹500
Markup 50.0% · Margin 33.3%
Markup
50.0%
Margin
33.3%
How It Works
Markup and margin are the two most-confused terms in pricing, and mixing them up quietly erodes profits. Both measure the same profit (selling price minus cost), but they divide it by different bases. Markup expresses profit as a percentage of the cost — how much you added on top. Margin expresses profit as a percentage of the selling price — how much of each sale you keep. Because the price is always larger than the cost on a profitable sale, margin is always smaller than markup: a product costing ₹100 sold at ₹150 has a 50% markup but only a 33.3% margin. This matters when translating a target between the two: if you want a 40% margin, you need a ~67% markup, not 40%. Retailers and buyers often think in markup, while accountants and investors think in margin, so being able to convert instantly avoids underpricing. This calculator takes your cost and price and shows both figures together.
Formula
Markup % = (Price − Cost) ÷ Cost × 100. Margin % = (Price − Cost) ÷ Price × 100. Same profit, different denominators.
Frequently Asked Questions
What is the difference between markup and margin?
Both use the same profit (price − cost) but different denominators. Markup = profit ÷ cost; margin = profit ÷ price. Margin is always the smaller number for a profitable sale.
Why is a 50% markup only a 33% margin?
A ₹100 cost with 50% markup sells for ₹150 (profit ₹50). Margin = 50 ÷ 150 = 33.3%. The markup divides profit by cost (100); the margin divides it by the higher price (150), giving a smaller percentage.
How do I convert a target margin to a markup?
Markup = Margin ÷ (1 − Margin). For a 40% margin: 0.40 ÷ (1 − 0.40) = 0.667 = 66.7% markup. This calculator does the conversion for you from cost and price.
Which should I use for pricing?
Use margin to understand profitability (what you keep per sale) and markup to set prices from cost. The danger is applying a markup percentage while thinking it is your margin — that underprices you.
Can markup exceed 100%?
Yes — markup can be any positive value (a ₹100 cost sold at ₹300 is a 200% markup). Margin, however, can never reach 100% because the price always includes the cost.