Margin vs Markup Chart — Conversion Table & Formulas
Every markup percentage converted to its margin — and the two formulas everybody confuses.
No signup, no trackingMargin and markup are two different percentages of two different denominators, and confusing them is the single most expensive arithmetic mistake in retail pricing. A 50% markup is not a 50% margin — it is a 33.3% margin, because the two ratios use different bases. This page is the conversion table plus the formulas, so you can look up either direction without doing the algebra.
Short version: markup is profit divided by cost; margin is profit divided by selling price. Same profit, same product, different denominator, different number. If you charge cost + 50%, your margin is 33.3%; if you want a 50% margin, you need to charge cost + 100%.
The conversion chart
Every common markup percentage with its equivalent margin, plus the multiplier you apply to cost to get the selling price. Read either column down; the other two are what the row means.
| Markup % | Margin % | Cost × ? = Price |
|---|---|---|
| 5% | 4.76% | × 1.05 |
| 10% | 9.09% | × 1.10 |
| 15% | 13.04% | × 1.15 |
| 20% | 16.67% | × 1.20 |
| 25% | 20.00% | × 1.25 |
| 30% | 23.08% | × 1.30 |
| 33.33% | 25.00% | × 1.33 |
| 35% | 25.93% | × 1.35 |
| 40% | 28.57% | × 1.40 |
| 45% | 31.03% | × 1.45 |
| 50% | 33.33% | × 1.50 |
| 60% | 37.50% | × 1.60 |
| 66.67% | 40.00% | × 1.67 |
| 70% | 41.18% | × 1.70 |
| 75% | 42.86% | × 1.75 |
| 80% | 44.44% | × 1.80 |
| 90% | 47.37% | × 1.90 |
| 100% | 50.00% | × 2.00 |
| 150% | 60.00% | × 2.50 |
| 200% | 66.67% | × 3.00 |
| 300% | 75.00% | × 4.00 |
| 400% | 80.00% | × 5.00 |
The formulas — both directions
Given cost (C) and selling price (P), profit is P − C.
MARKUP = (P − C) / C
MARGIN = (P − C) / P
Convert markup to margin:
margin = markup / (1 + markup)
Convert margin to markup:
markup = margin / (1 − margin)
Price from cost and target markup:
P = C × (1 + markup)
Price from cost and target margin:
P = C / (1 − margin)Worked example: a $50 item sold for $80. Profit is $30. Markup is 30 ÷ 50 = 60%. Margin is 30 ÷ 80 = 37.5%. Same product, same profit, two different percentages depending on which base you divide by.
When to use markup and when to use margin
| Use markup when… | Use margin when… |
|---|---|
| You know your cost and want to set a price by adding a percentage on top | You know your selling price and want to know what fraction of revenue is profit |
| Talking to suppliers or discussing markup categories internally | Reporting to investors, comparing product profitability, or analyzing gross margin trends |
| Retail rules of thumb ("keystone" = 100% markup = 50% margin) | Financial statements (gross margin, contribution margin, net margin are all margin ratios) |
| Pricing a new product from unit cost | Comparing profitability across products at different price points |
Both numbers describe the same transaction; the choice is about what question you are answering. Confusion usually starts when someone quotes "50%" without saying which one — always name the base.
The classic mistake and how much it costs
A shop wants a "50% margin" on a product that costs $100. Someone marks it up 50%, so the price becomes $150 — and the actual margin is only 33.3%. To hit a true 50% margin, the price must be $200 (a 100% markup). On every $100 unit, the shop leaves $50 of intended profit on the counter — half of what they thought they were making.
The larger the target margin, the more dangerous the confusion becomes: aiming for a 60% margin with a 60% markup delivers only 37.5% — you would need a 150% markup to actually hit 60%. Always convert to the intended base before setting the price. The margin calculator on this site does both conversions with your real numbers, and the ROI calculator picks up where this ends.
In Excel or Google Sheets
A2 = cost, B2 = selling price. Then:
Profit =B2-A2
Markup % =(B2-A2)/A2 → format as percentage
Margin % =(B2-A2)/B2 → format as percentage
Convert markup (in D2) to margin:
=D2/(1+D2)
Convert margin (in E2) to markup:
=E2/(1-E2)
Price from cost and target markup:
=A2*(1+D2)
Price from cost and target margin:
=A2/(1-E2)