Markup calculator

How it is worked out

• Price = cost times (1 + markup). A 150% markup on $12 is $30.
• Profit per unit = price minus cost.
• Gross margin = profit divided by price. Markup divides by cost, so the margin is never the larger number.

Example: a desk organizer that costs $12

• A 150% markup on $12 gives a price of $30.00.
• Profit per unit is $18.00, a 60% gross margin.
• Shipping, card fees and ads still come out of that $18.00.
• To set a price after those costs, use the product pricing calculator.

Questions

How do you calculate markup percentage?

• Markup % = (price minus cost) divided by cost, times 100.
• A $12 product sold at $30 has a 150% markup.

How do you calculate selling price using markup?

• Selling price = cost times (1 + markup).
• A 150% markup on a $12 cost gives $12 times 2.5 = $30.

What is the difference between markup and margin?

• Markup is profit divided by cost. Margin is profit divided by price.
• $12 sold at $30 is a 150% markup but a 60% margin.

What is the markup formula?

• Markup % = (price minus cost) divided by cost, times 100.
• Price = cost times (1 + markup %).

What markup should an online store use?

• Enough that shipping, card fees and ads still leave profit.
• Keystone pricing, a 100% markup, gives a 50% gross margin before those costs. Many stores that pay for ads need more.