zacdaddytools

zacdaddytools

Profit Margin & Markup Calculator

Calculate profit, margin, markup and the selling price needed for your target.

Pricing calculation

Compare a price or work backwards from a target percentage.

Margin and markup differ: margin compares profit with selling price; markup compares profit with cost.

Pricing result

Profit

£20.00

Selling price

£60.00

Cost price

£40.00

Profit margin

33.33%

Markup

50%

Calculate profit, margin and markup correctly

Enter the cost price and selling price to see the monetary profit, profit margin and markup immediately. If the selling price is below cost, the calculator clearly identifies a loss and keeps the negative percentages visible so the result is not mistaken for a profitable sale.

The target modes work in the other direction. Enter a cost and desired margin or markup to calculate the selling price required before VAT, marketplace charges or other costs that you have not included.

Margin and markup are not the same

Profit margin divides profit by the selling price. Markup divides the same profit by the cost price. Because the starting amounts differ, the two percentages normally differ even though the cash profit is identical. Confusing them can produce a selling price that is lower than intended.

£40 cost and £60 selling-price example

Profit is £60 − £40 = £20.

Margin is £20 ÷ £60 × 100 = 33.33%.

Markup is £20 ÷ £40 × 100 = 50%.

Use complete costs when setting a price

A useful margin depends on an accurate cost figure. Consider packaging, payment fees, marketplace commissions, delivery subsidies, labour and expected returns where they genuinely apply. VAT-registered businesses should also decide whether they are comparing net or VAT-inclusive figures and remain consistent throughout the calculation.

The result is a pricing aid rather than accounting advice. Check contract terms, taxes and platform charges before relying on a quoted selling price.

FAQs

Questions about the profit margin & markup calculator

What is the formula for profit margin?

Subtract cost from selling price, divide that profit by the selling price, then multiply by 100.

What is the formula for markup?

Subtract cost from selling price, divide that profit by the cost price, then multiply by 100.

What happens when selling price is below cost?

The result is shown as a loss with negative margin and markup percentages where those percentages are defined.

Does the calculator include VAT and fees?

No. Include every relevant amount in your chosen cost or selling-price figures and keep VAT treatment consistent.