Profit margin and markup calculator
Enter what an item costs and what you sell it for, or set the margin you want and get the price to charge.
- Profit per item
- £40.00
- Markup
- 66.7%
- Margin
- 40.0%
Margin and markup are not the same
Margin is profit as a percentage of the selling price. Markup is profit as a percentage of the cost.
An item that costs £60 and sells for £100 makes £40 profit. That is a 40% margin but a 66.7% markup.
The formulas
Margin % = (price − cost) ÷ price × 100.
Markup % = (price − cost) ÷ cost × 100.
Price for a target margin = cost ÷ (1 − margin ÷ 100). For a 40% margin on a £60 cost, that is £60 ÷ 0.6 = £100.
Leave VAT out of it
If you are VAT registered, use cost and selling price excluding VAT. The VAT you charge is not yours to keep, so including it makes your margin look better than it is.
This tool gives general guidance only and isn't tax or accounting advice.
Doing this every day?
OpesFlux keeps your products, purchases and sales in one system, so costs and selling prices sit side by side. See the features.
More free tools
- VAT calculator: Add VAT to a price or take it off, at 20%, 5%, 0% or a rate you enter.
- Reorder point calculator: Work out the stock level at which to reorder, including a safety stock buffer.
- Invoice generator: Fill in a UK invoice with VAT and save it as a PDF, right in your browser.
Questions people ask
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