What is the difference between margin and markup?

Margin is profit as a percent of revenue; markup is profit as a percent of cost. A 25% markup is not the same as a 25% margin.

Does this include tax or shipping?

Only if you include those amounts in the revenue or cost fields you enter.

Can margin be over 100%?

Gross margin as defined here stays below 100% when revenue is positive. Markup can exceed 100% when profit is larger than cost.

Profit Margin Calculator

How it works

Margin divides profit by selling price; markup divides profit by cost. The calculator solves the system from whichever pair you provide, so you never hand-transpose the wrong denominator.

Formula

Profit = Revenue − Cost Margin (%) = (Profit ÷ Revenue) × 100 Markup (%) = (Profit ÷ Cost) × 100

How to use Profit Margin Calculator

Identify what you know: for example revenue and cost, or price and target margin.
Enter values in the matching fields and select margin vs markup if prompted.
Read profit in dollars and margin or markup as a percentage.
Adjust inputs to model a price change or supplier cost increase.

Worked examples

Concrete numbers and cases you can check against the tool above.

Retail price from cost and target margin

Item cost $24, target 40% margin (not markup): revenue must be $40 because profit $16 is 40% of $40. Markup on cost would be 66.7%, not 40%.

When to use Profit Margin Calculator

Margin and markup are easy to confuse; mixing them leads to underpricing. A single calculator keeps formulas consistent when you negotiate costs or set retail prices.

Common use cases

Check whether a sale price still meets a 30% margin target.
Convert a vendor quote plus desired markup into a shelf price.
Explain margin on an invoice to a non-finance teammate.
Compare two SKUs with different costs on equal revenue.

Inputs and outputs

Currency amounts for revenue, cost, and profit
Percent for margin or markup

Privacy

This tool runs entirely in your browser. Your data never leaves your device — nothing is uploaded to our servers.

Frequently asked questions

What is the difference between margin and markup?: Margin is profit as a percent of revenue; markup is profit as a percent of cost. A 25% markup is not the same as a 25% margin.
Does this include tax or shipping?: Only if you include those amounts in the revenue or cost fields you enter.
Can margin be over 100%?: Gross margin as defined here stays below 100% when revenue is positive. Markup can exceed 100% when profit is larger than cost.