Free Markup vs. Margin Calculator for Small Businesses
Markup and margin both describe profit on an item, but they're measured against different numbers. Markup is profit as a percent of what the item costs you. Margin is profit as a percent of the price you sell it for. Mixing them up is a common way to underprice. Enter your numbers below to see both, or pick a target to get the price.
It runs in your browser. Nothing you type is saved or sent anywhere. The numbers filled in below are a made-up example; change them to yours.
How the math works
- Profit = price − cost.
- Margin = profit ÷ price.
- Markup = profit ÷ cost.
- Price for a target margin = cost ÷ (1 − margin).
- Price for a target markup = cost × (1 + markup).
Example (made up): an item that costs you $12 and sells for $30 makes $18 profit. That's a 60.0% margin and a 150.0% markup. A 50% margin needs a $24.00 price, but a 50% markup is only $18.00, so "50%" means very different prices depending on which one you mean.
Margin can never reach 100%, but markup can go over 100%. Include every cost of one item (shipping supplies and platform fees too), and remember your time and overhead come out of the profit. This is general information, not business or tax advice.
Price every product, not just one
The Product Pricing Calculator ($7) is a spreadsheet where you list your materials once (cost per unit works out from the pack price), then build up to 30 products from up to 4 materials each plus labor minutes and packaging/shipping. Set your hourly rate, target margin and one platform fee %, and it shows total cost, a price at your margin, 2x/4x reference prices, and the fee, profit and margin at the price you type. Works in Excel and Google Sheets. A pricing aid, not financial or tax advice.
Get the pricing calculator on Gumroad – $7
This template is also in the Self-Employed & Small Business Bundle (what's inside): all 9 business tools for $29 (about $80 if bought one by one).
Want profit and loss for the whole business? See the Small Business Bookkeeping Spreadsheet.
We make this template, so take that into account. The calculator above is free to use either way.
Related free guides
- How to Price a Product: Cost-Plus vs. Market Pricing
- How to Price Handmade Products for Profit
- How to Track Reseller Profit (Including Fees and Shipping)
- Simple Profit and Loss Statement for a Small Business
More free tools: all calculators.
See all Cedar & Ledger templates