Calculate the selling price from the desired markup or margin, or the other way around — find out the markup and margin from already known prices.
| Term | Formula |
|---|---|
| Markup | (Selling price − Cost) / Cost × 100 |
| Margin | (Selling price − Cost) / Selling price × 100 |
| Example | 100% markup = 50% margin (price doubled) |
Indicative markups/margins by sector (vary by company): food/retail ~15–30% margin, clothing ~50–60%, restaurants ~60–70%, SaaS/services ~70–90%.
Markup is calculated from the cost, margin — from the selling price. These are different numbers for the same situation: a 100% markup corresponds to only a 50% margin.
Markup is convenient for setting a price (when you know the cost), margin — for analyzing profitability (what % of sales remains as profit). Both metrics matter, but for different purposes.
Markup/margin are calculated on the price excluding VAT (your actual profit). VAT is added separately to the final price for the buyer — see the VAT calculator.
e-Buhalteris calculates the margin of every product/service automatically based on purchase and selling prices.
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