Profit margin and markup calculator for online sellers
Check your margin, find the price for a margin or markup you want, and see the difference between the two.
Margin and markup are not the same
Markup is profit as a percentage of what the item cost you. Margin is profit as a percentage of what you sell it for. The same sale gives different percentages. If an item costs 80 and sells for 100, the profit is 20, the markup is 20 ÷ 80 = 25%, and the margin is 20 ÷ 100 = 20%. Mixing them up is one of the most common pricing mistakes, because a 50% markup is only a 33.3% margin.
How to use this tool
- To check a price you already have, use the first box: enter the cost and the selling price.
- To work out a price that gives a margin you want, use the second box. Price = cost ÷ (1 − margin ÷ 100).
- To price from a markup, use the third box. Price = cost × (1 + markup ÷ 100).
- Read the working shown under each result, so you can check it.
Worked examples
| Question | Answer |
|---|---|
| Cost 80, price 100 | Profit 20, margin 20%, markup 25% |
| Cost 70, you want a 30% margin | Price 70 ÷ 0.70 = 100, profit 30 |
| Cost 80, you want a 50% markup | Price 80 × 1.5 = 120, profit 40, margin 33.33% |
Important limits
- This is gross profit on one item: price minus the cost you enter. It does not include costs you leave out, such as shipping, packaging, platform fees, returns, advertising, taxes or your time. Add those into the cost box, or use a fuller calculation, if you want a realistic figure.
- A margin of 100% or more is impossible, so the tool rejects it. Costs and prices cannot be negative.
- If the price is zero the margin is undefined, and if the cost is zero the markup is undefined. The tool says so.
- Results are rounded to two decimal places for display only.
Troubleshooting
| What you see | Likely reason | What to try |
|---|---|---|
| “Enter the cost and the selling price” | A box is empty | Fill in both boxes |
| Loss instead of profit | The price is lower than the cost | Check the numbers or raise the price |
| Margin message about 100 | Margin must be below 100% | Enter a lower margin |
Notice
This is a general-purpose calculator for information only. It is not financial, tax, accounting or legal advice. Prices, rates, fees and rules differ between sellers, platforms and countries.
Practical scenarios
- A reseller. Buying at 12.50 and selling at 18.00 gives a profit of 5.50, a margin of 30.56% and a markup of 44%. Quote the margin if you are asked what share of the price is profit, and the markup if you are asked how much you add to your cost.
- Planning a sale. With a cost of 70 and a price of 100, a 10% discount (price 90) leaves a profit of 20 and a margin of 22.22%. Enter the discounted price in the first box to see your new margin before you commit to the sale.
- Covering fixed costs. If you earn 20 per sale and your monthly fixed costs are 1,000, you need 50 sales a month to break even.
Getting realistic figures
For a more honest result, put everything you pay for one sale into the cost box: the item, inbound shipping, packaging, and a share of fees. For a full breakdown with platform fees, advertising and returns, use the Marketplace Fee and Net Profit Calculator. Our article on margin versus markup explains the conversion between the two with tables.
Tips
- Decide in advance whether your team means margin or markup, and write it down.
- Recalculate after every price or supplier change.
- Do not compare your margin with another business’s without knowing what their cost figure includes.
Frequently asked questions
What is the difference between margin and markup?
Markup is profit divided by cost. Margin is profit divided by the selling price, so it is always the smaller number.
What margin should I aim for?
That depends on your costs and market. This tool only does the arithmetic.
Does it include shipping and fees?
Only if you add them to the cost box.