Markup Calculator

This markup calculator can be used to quickly find out the markup and gross profit or to calculate the percentage of markup you need to reach. Enter cost either with your goal/outcome gross profit or sell price /total revenue/ markup percentage to solve for all of the items. The revenue and the markup price match if you are looking at it for a single-unit sale.

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How to use the Markup Calculator?

This versatile markup calculator will assist you in calculating the following metrics:

- (profit, markup and profit margin) when you know the cost and gross revenue)

-Revenue or markup price, markup and margin (if cost, gross profit is known)

- Revenue, profit and margin (cost and markup given)

Just write on the cost and the correlated business metrics of the output you would like to have, after that press "Calculate". Clipboard icon will be there adjacent to every value, so you can just copy & paste the results with the clipboard.

What is markup?

Markup (business) in the world of business, markup is the fee added to the cost of a product or service to come up with the selling price. This is sometimes known as the markup rate and it is typically displayed as a percent increase over cost. Markup is inherent in each sale because in order for producers or resellers to be able to cover their costs and gain a profit, they need it. To determine markup we take into account all fixed costs and variable to produce/distribute a product or service. For instance, markup is the percentage between what you sell retail price (markup price) and wholesale.  

Markup figures are a common aspect in political campaigns where politicians use them to promote more regulation of particular businesses or industries. Well they occasionally argue that markups are high above the table and thus there must be high profits. ..But as any funder would say, this can be misleading. While a highly-marked up business may not even be turning and paying its bills, once taxes and debt interest are also considered. Keep in mind the markup being referred to may not include non variable costs, (rent, maintenance and depreciation for example). Remember this when reviewing markup results.

Markup formula

The formula to calculate markup in a price is:

Markup = Revenue / Cost

Revenue is your total sales. The relevant currency is both inside the equation's input values, but the resulting markup is a ratio that you can convert to a percentage by multiplying the result by 100. This markup percentage formula and its variations are what our markup calculation tool is based on.

 How do you calculate your markup?

Once you have this formula in mind, you can proceed with the Production Costs estimation, which refers to the Variable and Fixed Costs of producing the Goods or Services that are resold by the business. If you are calculating for a past period, we still know the gross revenue from the sales of goods and services we produced, so we just put numbers in the formula.

For an example say, costs are 100000 and revenue = 120000, the equation would be like this: Markup = (120,000 – 100,000)/100000 – 1 = 20,000/100000 = 1/ , the markup ratio. To convert to percentage, times by 100: 1/5 * 100 = 20% markup.

This markup rate will result in a profit margin that tells you that for every $5 sale, the biz takes home gross after costs.

If all you have is cost and profit, then just add them together to get revenue in the same equation. With this price markup calculator, you can find out what you need to price something markup if that's what you want to calculate. Enter the cost and markup percentage.

 How do you calculate a markup price?

There are a total of 4 practical selling price calculation scenarios, which are all based on either being known or given:

• It is a one-line percentage increase calculation if you know the percentage markup. For example, you add the cost of goods to the RESULT of cost/services * markup rate. Markup price calculation is as follows: using a simple example of a cost of $100 / rate of 40%, markup price is $100 + $100 = 40%=$100 + ($40gradient=$140 including the markup.
• If you know the dollar amount of markup, it's just an easy add. Markup is simple: cost is $ 100, and markup is 50; therefore, add 150 back to 100 to get the price list.
• If the required dollar amount of profit is known, Say you want to make $10 of profit per unit sold; if the unit costs $50 to make, then the price of sale is just cost + profit per unit (e.g., $50 + $10 = $60); Markup percentage is $60 / $50 = 120%-100% or 20% -100%=20℅
• Required Profit Margin  (calculating margin rate by markup rate), this is getting a little more complex. To get the price with markup based on margin percentage, one has to solve the following: Price with markup = Cost / (1 – Margin(%). For example, one that wants to make a 20% profit margin on $200 worth of cost would have to sell for $200/$80 = $250 (markup of 50%, or a 25 percent markup of the goods or services). You can use our (margin) calculator to solve these problems.

 Markup vs. Margin

Markup and Margin are sometimes confused, but they are very different metrics. Capital is markup. Hence, the difference between your costs and your revenue vs. Margin is the difference between your costs and profits revenue. Markup helps approximate how much you are marketing above costs, and Margin helps approximate what % of your revenue is profit (net income).