Profit Margin & Markup Calculator

Margin and markup measure different things

Gross margin compares gross profit with selling price. Markup compares that same profit with cost. A product costing 60 and selling for 100 earns 40 gross profit: a 40% margin and approximately 66.67% markup.

Gross profit = selling price − cost.
Margin (%) = profit ÷ selling price × 100.
Markup (%) = profit ÷ cost × 100.
Price at target margin = cost ÷ (1 − margin ÷ 100).
Price at target markup = cost × (1 + markup ÷ 100).

Find a price from a target

Select a target gross margin or markup to solve for price. A 25% markup on cost 80 gives price 100; that price produces a 20% margin. Margin targets must be below 100% because the pricing formula divides by the remaining cost share.

Zero cost and losses

Markup is undefined when cost is zero. Selling below cost produces negative gross profit. This calculation excludes overhead, tax, refunds, shipping, and payment fees unless you include them in unit cost. It is not a net-profit calculation.

Background: AccountingCoach: gross margin and markup.

About this tool

Prepared by the UtilitiesWeb team at The Alpha 1 Company. Review results before using or sharing them. Business calculations are educational estimates and do not replace professional accounting, tax, or legal advice.

Methodology updated: 1 November 2026. Inputs are processed locally; clearing or leaving the page releases the working result.