Your margin and markup from cost and price

Profit margin & markup

Calculate profit margin and markup percentage from a product's cost and selling price.

Formula

margin = (price − cost) / price · markup = (price − cost) / cost

Frequently asked questions

Why are margin and markup different numbers for the same sale?
Margin is profit as a percentage of the selling price; markup is profit as a percentage of the cost. A RM20 profit on a RM60 cost is a 33% markup but only a 25% margin — they always diverge except at 0%.

Which one should I use to set prices?
Markup is usually easier to apply when pricing from cost (e.g. "add 50% markup"), while margin is more useful for comparing profitability across products, since it's directly tied to revenue.