Quick Answer: Markup = (Selling Price − Cost) ÷ Cost × 100. A 50% markup equals a 33.3% margin — not 50%. Enter cost and selling price below to get markup %, margin %, and the instant conversion between both.
Confusing markup with margin is the #1 reason small businesses underprice. Calculate both — and convert between them — in seconds.
Calculate markup % and instantly see the equivalent margin
Markup is calculated from cost. Margin is calculated from revenue. A $60 item with a 50% markup sells for $90 — that's a 33.3% margin, not 50%. Business owners who price using markup and mentally plan for a 50% margin are actually operating 16.7 points below target. On $500,000 in annual revenue, that's $83,500 in missing profit. Use this calculator every time you set a price.
Last Verified: May 2026 | Verified by: TheMarginCalculator.com Research Team | Report a Data ErrorReviewed by Marcus R., Lead Financial Analyst. Markup formulas verified against standard retail and wholesale pricing conventions. Meet the full team.
Both measure the same profit dollars from different angles. Markup divides profit by cost. Margin divides profit by selling price. Because the denominator is different, the percentages are always different — and confusing them costs money.
| Markup % | Equals Margin % | Markup needed for this Margin |
|---|---|---|
| 10% | 9.1% | — |
| 25% | 20% | 25% |
| 43% | 30% | 42.9% |
| 67% | 40% | 66.7% |
| 100% | 50% | 100% |
| 150% | 60% | 150% |
Markup conventions vary enormously by industry, and knowing your category's norm helps you sanity-check your own pricing. Grocery and convenience retail often run thin markups of 10–25% due to high volume and perishability. General retail and apparel commonly target 50–100% markup (often called "keystone" pricing at 100%). Restaurants typically markup food cost 200–300% (a 3–4x multiplier) to cover labor, rent, and waste that a simple ingredient-cost markup doesn't capture. Custom and made-to-order goods, where labor is a larger share of value than materials, can run markups of 150–300%+. None of these numbers are universal rules — they're starting reference points, and your actual required markup depends on your specific fixed costs, target margin, and competitive pricing environment.
The most expensive markup mistake is treating it as interchangeable with margin. A retailer who sets a 50% markup goal but reports it internally as "50% margin" is actually pricing 16.7 percentage points below their real target — on $500,000 in revenue, that gap alone is over $83,000 in profit left on the table every year. Second, many businesses apply a flat markup percentage to every SKU regardless of turnover speed. Slow-moving inventory usually needs a higher markup to compensate for the carrying cost of capital sitting on a shelf, while fast-moving, high-volume items can often support a lower markup because volume compensates for a thinner per-unit profit. Third, markup calculated on cost alone ignores landed cost — freight, duties, and receiving labor all belong in the cost figure before you apply your markup percentage, or your real margin will run thinner than your spreadsheet shows.