Find your selling price from cost and markup, or work out the markup and margin on a price you already charge.
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Markup formulas
| To find | Formula |
|---|---|
| Selling price | Cost × (1 + markup %) |
| Markup | (Price − cost) ÷ cost × 100 |
| Margin | (Price − cost) ÷ price × 100 |
| Price for a target margin | Cost ÷ (1 − margin %) |
Markup vs margin
| Markup | Margin |
|---|---|
| 25% | 20% |
| 50% | 33.3% |
| 100% | 50% |
| 200% | 66.7% |
| 300% | 75% |
Markup is always the bigger number because it’s measured against the smaller cost. Mixing them up is a common pricing mistake: adding a 30% markup gives only a 23% margin.
Choosing a markup
Retail markups vary widely by sector. Include all your costs (product, delivery, packaging, payment and platform fees) before setting a markup, and check what competitors charge.
Frequently asked questions
What is the difference between markup and margin?
Markup is profit divided by cost; margin is profit divided by selling price.
What is a 50% markup?
Price = cost × 1.5, which gives a 33.3% margin.
How do I price for a 40% margin?
Divide cost by 0.6. A £20 cost needs a £33.33 price.
Should I include VAT?
Work out markup on prices before VAT, then add VAT on top.
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