How to use the markup calculator
Enter the product cost and the markup percentage you want to apply. The calculator adds the markup to your cost and displays a suggested selling price, markup amount, and resulting gross profit margin. Keep all amounts in the same currency.
Markup formula
Selling price = Product cost × (1 + Markup percentage ÷ 100)
The markup amount is the product cost multiplied by the markup rate. Add that amount to the original cost to calculate the selling price before any additional expenses, discounts, or taxes.
Example: apply a 50% markup
If a product costs $40 and you apply a 50% markup, the markup amount is $20. Add $20 to the $40 cost to get a selling price of $60. The resulting gross profit margin is 33.33%, because margin is calculated using the selling price rather than the cost.
Markup vs. profit margin
Markup and margin both compare profit with another amount, but they use different bases. Markup divides profit by cost; margin divides profit by selling price. A 50% markup therefore does not create a 50% margin. If you have a target margin instead, use the profit margin calculator to evaluate a selling price and product cost.
Choosing a practical markup
A markup target should reflect more than the purchase cost. Consider marketplace commissions, payment processing, packaging, shipping, returns, labor, and overhead when setting prices. The result here is a price based on the cost and markup you enter; it is not a guarantee that the final sale will be profitable.
Frequently asked questions
How do I calculate markup percentage?
Subtract cost from selling price, divide the difference by cost, and multiply by 100. For example, a $60 selling price on a $40 cost represents a 50% markup.
Can markup be used to set retail prices?
Yes. Businesses often apply a target markup to estimate a selling price, then review that price against market demand, competitor pricing, and all other costs.
Related calculators
- Profit Margin Calculator – compare gross profit with selling price.
- Ecommerce Profit Calculator – estimate profit after common order costs.
- Break-Even Calculator – estimate the units needed to cover fixed costs.