Break-even point
Find how many units cover your costs, and how many could hit your profit goal.
Business basicsBusiness basics
Margin & markup calculator
Same profit. Different percentages.
Your numbers
Find your profit, margin, and markup—or work out the price needed for a target margin.
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THE MATH, WITHOUT THE MYSTERY
What’s actually happening here?
Margin divides profit by the selling price. Markup divides the same profit by the cost. They answer different questions, so a 50% markup is not a 50% margin.
For a target margin m written as a decimal, selling price = cost / (1 − m). A margin of 100% is impossible with a positive cost and a finite selling price.
THE FORMULA
Margin = (Price − Cost) / Price × 100; Markup = (Price − Cost) / Cost × 100
A small example
Buy for 40 and sell for 60: profit is 20, markup is 50%, and margin is 33.33%. To get a 50% margin on a cost of 40, sell for 80.
GOOD QUESTIONS
A few things worth knowing.
Why is markup larger than margin?
For a profitable sale, the cost is smaller than the selling price. Dividing the same profit by that smaller base produces a larger percentage.
What belongs in the cost?
Use a consistent definition. Product cost gives a gross-margin view; including other variable costs gives a contribution-style view. The result does not automatically include all business overhead.