What is the difference between margin and markup?

Margin is profit divided by selling price (revenue); markup is profit divided by cost. The two percentages are never equal except at 0%.

What is a good profit margin?

It varies widely by industry — thin-margin businesses like grocery retail may run 1-3%, while software or luxury goods can exceed 50%.

Business Finance

Profit Margin Calculator

Calculate profit, profit margin, and markup from cost and selling price.

Cost price

Selling price (revenue)

Profit

20.00

Profit margin

33.3%

Markup

50.0%

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About this tool

Enter your cost price and selling price to see your profit in dollars, your profit margin (profit as a percentage of revenue), and your markup (profit as a percentage of cost) — two related but different numbers business owners often confuse.

How to use this tool

1
Enter your cost price
Type what it costs you to produce or acquire the item.
2
Enter your selling price
Type the price you sell it for.
3
Compare margin and markup
See both figures side by side, since they answer different questions.

Frequently asked questions

What is the difference between margin and markup?: Margin is profit divided by selling price (revenue); markup is profit divided by cost. The two percentages are never equal except at 0%.
What is a good profit margin?: It varies widely by industry — thin-margin businesses like grocery retail may run 1-3%, while software or luxury goods can exceed 50%.

BusinessFinance