Markup is the percentage premium added to the wholesale cost of a product to determine its final retail selling price.

What is the formula for markup percentage?

Markup% = (Selling Price - Cost) / Cost × 100. It measures profit relative to unit cost.

How do I calculate selling price from cost and markup?

Selling Price = Cost × (1 + Markup%). For example, an item costing $20 with a 75% markup sells for $20 × 1.75 = $35.

Keystoning is a standard retail pricing rule where the selling price is set at exactly double the wholesale cost, representing a 100% markup.

Why do businesses confuse markup with margin?

They use the same profit dollars but different denominators. Markup is a percentage of cost; margin is a percentage of the selling price.

Can markup be negative?

Yes, if you sell a product below its wholesale cost (a loss leader or liquidation), the markup is negative, representing a loss.

Does this calculator include shipping costs?

No. Add any inbound shipping or freight costs to the wholesale cost field to ensure your markup covers the true landing cost.

What is a gross profit margin?

The percentage of sales revenue remaining after subtracting the direct cost of goods sold (COGS).

How does high markup affect sales volume?

Setting markup too high can make products uncompetitive, reducing sales volume. Balance markup margins with market demand.

What is a cost multiplier?

A cost multiplier is the factor applied to cost to find selling price. A 40% markup has a 1.4x multiplier; a 150% markup has a 2.5x multiplier.

business calculator

Markup Calculator

Calculate markup and margin from cost and selling price.

Formula Verified by Dr. Marcus Sterling, PhD

Quick actions: Save inputs, view saved runs, print, share, or export results

Saved Runs

Inputs

Calculation Mode

Cost (what you paid)$

Selling Price (revenue)$

Step-by-Step Calculation

Profit = Selling Price − Cost$100.00 − $80.00 = $20.00

Markup % = (Profit ÷ Cost) × 10025.00%

Margin % = (Profit ÷ Price) × 10020.00%

Results

Markup Percentage

25.00%

Profit Margin20.00%

Gross Profit$20.00

Cost$80.00

Selling Price$100.00

Markup vs Margin

Markup

25.00%

% of cost

Margin

20.00%

% of revenue

Bookmark this markup calculator

Save this page to quickly price products, check margins, and compare markup rates across your product range.

Formula

Markup Formula

Markup% = (Profit ÷ Cost) × 100   ·   Price = Cost × (1 + Markup%)   ·   Margin% = (Profit ÷ Price) × 100

Markup and margin both describe profit, but markup uses cost as the denominator while margin uses selling price.

Step by step

How the calculation works

1Select the calculation mode: Find Markup %, Find Selling Price, or Find Cost.
2Enter the known values for your selected mode.
3Review markup percentage, profit margin, and gross profit side by side.

Related guides

Learn more about this calculation

Guide

Discount, Markup, and Margin: A Practical Pricing Guide

Calculate sale price, markup, and margin, then test how a discount changes unit profit, required sales volume, and the economics of a promotion.

Guide

Profit Margin: Formulas, Examples, and Calculator Guide

Calculate gross, operating, and net profit margins, understand margin versus markup, and use each result to make better pricing and cost decisions.

How to understand and use this calculator

What is Markup?

Markup (also called markon) is the amount you add to the cost of a product to determine its selling price. It's the extra amount you charge customers above what you paid.

Simple worked example:

You buy a product for $80 (your cost).
You sell it for $100 (your selling price).
The extra $20 you added is your markup.
Markup Percentage = ($20 ÷ $80) × 100 = 25%.

Why markup matters: It determines your gross profit on each sale, covers overhead expenses, and forms the basis of your pricing strategy.

To compare these figures with other business calculations, you can use our Profit Margin Calculator or compute total markdowns using our Discount Calculator.

Key point: Markup is always calculated as a percentage of the cost — not the selling price. This is different from profit margin, which is calculated as a percentage of revenue.

Markup vs Margin — What's the Difference?

Many business owners confuse markup and profit margin. Here's the key difference:

Markup = (Profit ÷ Cost) × 100 → "How much am I adding to what I paid?"
Margin = (Profit ÷ Revenue) × 100 → "How much of my selling price is profit?"

Example with the same numbers:

Cost = $80, Selling Price = $100, Profit = $20
Markup = ($20 ÷ $80) × 100 = 25%
Margin = ($20 ÷ $100) × 100 = 20%

The rule: Markup is always higher than margin (unless profit is zero). A 25% markup corresponds to a 20% margin. A 50% markup corresponds to a 33.3% margin. Use our Percentage Calculator to perform general ratio checkups.

Use the calculator above to instantly see both figures side by side.

The Markup Formula

The markup formula is simple and essential for any business:

Markup Percentage = (Profit ÷ Cost) × 100

Where: Profit = Revenue (Selling Price) − Cost.

All three formulas you need:

Find Markup %: (Revenue − Cost) ÷ Cost × 100.
Find Selling Price: Cost × (1 + Markup% ÷ 100).
Find Cost: Revenue ÷ (1 + Markup% ÷ 100).

Example using all three:

Cost = $80, Markup = 25%
Selling Price = $80 × (1 + 25/100) = $80 × 1.25 = $100
Profit = $100 − $80 = $20
Verify Markup: ($20 ÷ $80) × 100 = 25% ✅

How to Calculate Markup — Step by Step

To find markup % from cost and selling price:

Step 1: Find profit → $50 − $40 = $10
Step 2: Divide profit by cost → $10 ÷ $40 = 0.25
Step 3: Multiply by 100 → 25% markup

To find selling price from cost and markup %:

Step 1: Cost = $80, Markup = 25%
Step 2: Convert % to decimal → 25 ÷ 100 = 0.25
Step 3: Add 1 → 1 + 0.25 = 1.25
Step 4: Multiply → $80 × 1.25 = $100

To find cost from selling price and markup %:

Step 1: Selling Price = $100, Markup = 25%
Step 2: Convert % to decimal and add 1 → 1.25
Step 3: Divide → $100 ÷ 1.25 = $80

Industry Average Markup Rates

Different industries use different standard markup rates based on volume and overhead costs:

Grocery Retail — ~15% (low margins, high volume).
Restaurant Food — ~60% (covers raw ingredients, labor, and utilities).
Restaurant Beverages — 500%+ (wine, spirits, soda).
Jewelry — ~50% (high value items).
Clothing — 150–250% (depends on brand premium).
Automotive (new cars) — 5–10% (very low margins).
Electronics — 20–30% (highly competitive market).
Furniture — 50–100% (high storage and delivery overhead).

Important: High markup ≠ high net profit. Restaurants have high markups but also very high operational overhead, so actual profit margins are often just 3–9%.

High Markup Products — Real Examples

Some products have surprisingly high markups due to low production costs and high perceived value:

Movie Theater Popcorn — ~1,275% (convenience, captive audience).
Bottled Water — ~4,000% (packaging, brand, convenience).
Restaurant Wine — 200%+ (dining experience premium).
Greeting Cards — 100–300% (low production cost, high perceived value).
College Textbooks — 100–300% (required purchases, limited competition).
Eyeglass Frames — 100–200% (brand, design, limited competition).
Bakery Goods — 100–300% (freshness, convenience, small quantities).

Key insight: Products with high markups typically have low production costs, high perceived value, limited competition, a captive audience, or strong convenience factor.

Cost-Plus Pricing Strategy

Most businesses use cost-plus pricing — the most common pricing strategy:

How it works:

Step 1: Determine your unit cost (COGS).
Step 2: Add a standard markup percentage.
Step 3: The result is your selling price.

Formula: Price = Cost × (1 + Markup%)

Example: Unit cost = $50, Markup = 40% → Price = $50 × 1.40 = $70

Advantages: Simple to calculate, ensures cost coverage, easy to adjust when costs change.

Disadvantages: Ignores customer demand and competition — may overprice or underprice.

Better approach: Use markup as a starting point, but also consider: what customers are willing to pay, what competitors charge, and how demand changes with price.

Common Markup Calculation Mistakes

Confusing markup with margin — Markup = profit/cost. Margin = profit/revenue. They use different denominators.
Forgetting to convert % to decimal — Use 0.25 in formulas, not 25.
Adding markup to selling price instead of cost — Markup is always added to the cost.
Forgetting all costs — Include shipping, storage, labor, and overhead in your cost, not just purchase price.
Same markup for every product — Different products deserve different markups based on demand, competition, and perceived value.
Ignoring competition — Setting markup without checking what others charge can lose you customers.
Not reviewing when costs change — If your supplier raises prices, your markup percentage stays the same but your profit shrinks. Review pricing regularly.

Related Calculators You Might Need

Once you've completed your markup calculations, explore these related pricing and sales analysis tools:

Profit Margin Calculator — Calculate profit margin percentage relative to revenue.
Discount Calculator — Determine the final price of an item after markdowns.
Sales Tax Calculator — Add sales tax to your final priced products.
Break-Even Calculator — Find how many sales you need to cover fixed costs.

Related concepts

Profit Margin

Profit as a percentage of revenue — always lower than markup for the same product.

COGS

Cost of Goods Sold — all costs to acquire or produce the product, including materials, labor, and shipping.

Cost-Plus Pricing

A pricing strategy where selling price = cost × (1 + markup%). Simple but ignores demand.

Markdown

The opposite of markup — reducing a selling price below its original level, often for sales or clearance.

Frequently Asked Questions

What is a markup calculator?+

A markup calculator helps you find the markup percentage, selling price, or cost of a product. Enter any two values and get the third instantly — no manual formula needed.

How do you calculate markup?+

Markup Percentage = (Profit ÷ Cost) × 100. First find profit (Selling Price − Cost), then divide by cost, then multiply by 100. Example: $20 profit on $80 cost = 25% markup.

What is the markup formula?+

Three formulas: (1) Markup % = (Revenue − Cost) ÷ Cost × 100. (2) Selling Price = Cost × (1 + Markup% ÷ 100). (3) Cost = Revenue ÷ (1 + Markup% ÷ 100). Use the calculator's mode selector to apply any of them.

What is the difference between markup and margin?+

Markup is calculated as a percentage of cost. Margin is calculated as a percentage of revenue. Example: $20 profit on $80 cost = 25% markup, but only 20% margin on $100 selling price. Markup is always higher than margin.

How do I find the selling price with markup?+

Selling Price = Cost × (1 + Markup% ÷ 100). Example: $80 cost with 25% markup → $80 × 1.25 = $100. Use the "Find Selling Price" mode in the calculator above.

What is a good markup percentage?+

It depends on your industry. Grocery is ~15%, restaurants ~60%, clothing 150–250%, jewelry ~50%, automotive 5–10%. Consider your industry standards, overhead costs, and competition.

Can markup be over 100%?+

Yes! Many products have markups over 100%. A product costing $10 and selling for $30 has a 200% markup. Movie theater popcorn has a markup of over 1,000%. High markups are common when production costs are low and perceived value is high.

What is cost-plus pricing?+

Cost-plus pricing is a strategy where you add a standard markup percentage to your unit cost to determine the selling price. Formula: Price = Cost × (1 + Markup%). It's simple and ensures you cover costs, but ignores customer demand and competition.

Is markup the same as profit?+

No. Markup is a percentage ratio (profit relative to cost). Profit is the actual dollar amount (revenue minus cost). A 25% markup on $80 cost gives $20 profit. They're related but different things.

What is COGS?+

COGS stands for Cost of Goods Sold — the total cost of acquiring or producing the products you sell, including materials, labor, and shipping. This is the "cost" input in markup calculations.

What happens if I set my markup too high?+

If your markup is too high, customers may buy from competitors instead. You'll need to balance profitability with competitive pricing. Research what similar products cost in your market.

What happens if I set my markup too low?+

If your markup is too low, you may not cover your overhead costs or generate enough profit to grow. Always ensure your selling price covers all costs — including rent, labor, utilities — not just the product cost.

How do I check if my markup is correct?+

Compare your markup to industry averages, calculate both your markup percentage and profit margin, and ensure you're covering all costs. Also check what competitors are charging for similar products.

Why do high markup products exist?+

High markups exist on products with low production costs, high perceived value, limited competition, or captive audiences (like movie popcorn or prescription drugs). The market price is set by willingness to pay, not just cost.

Is this markup calculator free?+

Yes — completely free with no registration required. Use any of the three modes to find markup percentage, selling price, or cost instantly.

How to understand and use this calculator

What is Markup?

Markup (also called markon) is the amount you add to the cost of a product to determine its selling price. It's the extra amount you charge customers above what you paid.

Simple worked example:

You buy a product for $80 (your cost).
You sell it for $100 (your selling price).
The extra $20 you added is your markup.
Markup Percentage = ($20 ÷ $80) × 100 = 25%.

Why markup matters: It determines your gross profit on each sale, covers overhead expenses, and forms the basis of your pricing strategy.

To compare these figures with other business calculations, you can use our Profit Margin Calculator or compute total markdowns using our Discount Calculator.

Key point: Markup is always calculated as a percentage of the cost — not the selling price. This is different from profit margin, which is calculated as a percentage of revenue.

Markup vs Margin — What's the Difference?

Many business owners confuse markup and profit margin. Here's the key difference:

Markup = (Profit ÷ Cost) × 100 → "How much am I adding to what I paid?"
Margin = (Profit ÷ Revenue) × 100 → "How much of my selling price is profit?"

Example with the same numbers:

Cost = $80, Selling Price = $100, Profit = $20
Markup = ($20 ÷ $80) × 100 = 25%
Margin = ($20 ÷ $100) × 100 = 20%

Use the calculator above to instantly see both figures side by side.

The Markup Formula

The markup formula is simple and essential for any business:

Markup Percentage = (Profit ÷ Cost) × 100

Where: Profit = Revenue (Selling Price) − Cost.

All three formulas you need:

Find Markup %: (Revenue − Cost) ÷ Cost × 100.
Find Selling Price: Cost × (1 + Markup% ÷ 100).
Find Cost: Revenue ÷ (1 + Markup% ÷ 100).

Example using all three:

Cost = $80, Markup = 25%
Selling Price = $80 × (1 + 25/100) = $80 × 1.25 = $100
Profit = $100 − $80 = $20
Verify Markup: ($20 ÷ $80) × 100 = 25% ✅

How to Calculate Markup — Step by Step

To find markup % from cost and selling price:

Step 1: Find profit → $50 − $40 = $10
Step 2: Divide profit by cost → $10 ÷ $40 = 0.25
Step 3: Multiply by 100 → 25% markup

To find selling price from cost and markup %:

Step 1: Cost = $80, Markup = 25%
Step 2: Convert % to decimal → 25 ÷ 100 = 0.25
Step 3: Add 1 → 1 + 0.25 = 1.25
Step 4: Multiply → $80 × 1.25 = $100

To find cost from selling price and markup %:

Step 1: Selling Price = $100, Markup = 25%
Step 2: Convert % to decimal and add 1 → 1.25
Step 3: Divide → $100 ÷ 1.25 = $80

Industry Average Markup Rates

Different industries use different standard markup rates based on volume and overhead costs:

Grocery Retail — ~15% (low margins, high volume).
Restaurant Food — ~60% (covers raw ingredients, labor, and utilities).
Restaurant Beverages — 500%+ (wine, spirits, soda).
Jewelry — ~50% (high value items).
Clothing — 150–250% (depends on brand premium).
Automotive (new cars) — 5–10% (very low margins).
Electronics — 20–30% (highly competitive market).
Furniture — 50–100% (high storage and delivery overhead).

Important: High markup ≠ high net profit. Restaurants have high markups but also very high operational overhead, so actual profit margins are often just 3–9%.

High Markup Products — Real Examples

Some products have surprisingly high markups due to low production costs and high perceived value:

Movie Theater Popcorn — ~1,275% (convenience, captive audience).
Bottled Water — ~4,000% (packaging, brand, convenience).
Restaurant Wine — 200%+ (dining experience premium).
Greeting Cards — 100–300% (low production cost, high perceived value).
College Textbooks — 100–300% (required purchases, limited competition).
Eyeglass Frames — 100–200% (brand, design, limited competition).
Bakery Goods — 100–300% (freshness, convenience, small quantities).

Key insight: Products with high markups typically have low production costs, high perceived value, limited competition, a captive audience, or strong convenience factor.

Cost-Plus Pricing Strategy

Most businesses use cost-plus pricing — the most common pricing strategy:

How it works:

Step 1: Determine your unit cost (COGS).
Step 2: Add a standard markup percentage.
Step 3: The result is your selling price.

Formula: Price = Cost × (1 + Markup%)

Example: Unit cost = $50, Markup = 40% → Price = $50 × 1.40 = $70

Advantages: Simple to calculate, ensures cost coverage, easy to adjust when costs change.

Disadvantages: Ignores customer demand and competition — may overprice or underprice.

Better approach: Use markup as a starting point, but also consider: what customers are willing to pay, what competitors charge, and how demand changes with price.

Common Markup Calculation Mistakes

Confusing markup with margin — Markup = profit/cost. Margin = profit/revenue. They use different denominators.
Forgetting to convert % to decimal — Use 0.25 in formulas, not 25.
Adding markup to selling price instead of cost — Markup is always added to the cost.
Forgetting all costs — Include shipping, storage, labor, and overhead in your cost, not just purchase price.
Same markup for every product — Different products deserve different markups based on demand, competition, and perceived value.
Ignoring competition — Setting markup without checking what others charge can lose you customers.
Not reviewing when costs change — If your supplier raises prices, your markup percentage stays the same but your profit shrinks. Review pricing regularly.

Related Calculators You Might Need

Once you've completed your markup calculations, explore these related pricing and sales analysis tools:

Profit Margin Calculator — Calculate profit margin percentage relative to revenue.
Discount Calculator — Determine the final price of an item after markdowns.
Sales Tax Calculator — Add sales tax to your final priced products.
Break-Even Calculator — Find how many sales you need to cover fixed costs.

Related concepts

Profit Margin

Profit as a percentage of revenue — always lower than markup for the same product.

COGS

Cost of Goods Sold — all costs to acquire or produce the product, including materials, labor, and shipping.

Cost-Plus Pricing

A pricing strategy where selling price = cost × (1 + markup%). Simple but ignores demand.

Markdown

The opposite of markup — reducing a selling price below its original level, often for sales or clearance.

Frequently Asked Questions

What is a markup calculator?+

A markup calculator helps you find the markup percentage, selling price, or cost of a product. Enter any two values and get the third instantly — no manual formula needed.

How do you calculate markup?+

Markup Percentage = (Profit ÷ Cost) × 100. First find profit (Selling Price − Cost), then divide by cost, then multiply by 100. Example: $20 profit on $80 cost = 25% markup.

What is the markup formula?+

What is the difference between markup and margin?+

How do I find the selling price with markup?+

Selling Price = Cost × (1 + Markup% ÷ 100). Example: $80 cost with 25% markup → $80 × 1.25 = $100. Use the "Find Selling Price" mode in the calculator above.

What is a good markup percentage?+

It depends on your industry. Grocery is ~15%, restaurants ~60%, clothing 150–250%, jewelry ~50%, automotive 5–10%. Consider your industry standards, overhead costs, and competition.

Can markup be over 100%?+

What is cost-plus pricing?+

Is markup the same as profit?+

No. Markup is a percentage ratio (profit relative to cost). Profit is the actual dollar amount (revenue minus cost). A 25% markup on $80 cost gives $20 profit. They're related but different things.

What is COGS?+

COGS stands for Cost of Goods Sold — the total cost of acquiring or producing the products you sell, including materials, labor, and shipping. This is the "cost" input in markup calculations.

What happens if I set my markup too high?+

If your markup is too high, customers may buy from competitors instead. You'll need to balance profitability with competitive pricing. Research what similar products cost in your market.

What happens if I set my markup too low?+

How do I check if my markup is correct?+

Compare your markup to industry averages, calculate both your markup percentage and profit margin, and ensure you're covering all costs. Also check what competitors are charging for similar products.

Why do high markup products exist?+

Is this markup calculator free?+

Yes — completely free with no registration required. Use any of the three modes to find markup percentage, selling price, or cost instantly.

Markup Calculator

Inputs

Step-by-Step Calculation

Results

Bookmark this markup calculator

Markup Formula

How the calculation works

Learn more about this calculation

Discount, Markup, and Margin: A Practical Pricing Guide

Profit Margin: Formulas, Examples, and Calculator Guide

Markup Calculator

Inputs

Step-by-Step Calculation

Results

Bookmark this markup calculator

Key output metrics

Selling Price Breakdown

Markup vs Profit Margin

How to understand and use this calculator

What is Markup?

Markup vs Margin — What's the Difference?

The Markup Formula

How to Calculate Markup — Step by Step

Industry Average Markup Rates

High Markup Products — Real Examples

Cost-Plus Pricing Strategy

Common Markup Calculation Mistakes

Related Calculators You Might Need

Related concepts

Frequently Asked Questions

Markup Formula

How the calculation works

Learn more about this calculation

Discount, Markup, and Margin: A Practical Pricing Guide

Profit Margin: Formulas, Examples, and Calculator Guide

Key output metrics

Selling Price Breakdown

Markup vs Profit Margin

How to understand and use this calculator

What is Markup?

Markup vs Margin — What's the Difference?

The Markup Formula

How to Calculate Markup — Step by Step

Industry Average Markup Rates

High Markup Products — Real Examples

Cost-Plus Pricing Strategy

Common Markup Calculation Mistakes

Related Calculators You Might Need

Related concepts

Frequently Asked Questions