How it works
Selling price = cost × (1 + markup ÷ 100).
A worked example
A cost of 60 with 50% markup gives a price of 90 and a gross margin of 33.33%.
What to keep in mind
Markup is a percentage of cost. Excludes transaction fees, delivery, taxes and overheads.
Markup formula
Selling price = cost × (1 + markup ÷ 100). A £60 cost with a 50% markup gives a £90 selling price and £30 of profit.
Markup and margin
The same profit looks different as markup and margin. A 100% markup on a £20 cost gives a £40 price, which is a 50% margin. A 50% markup gives a 33.3% margin.
Adding VAT
If you are VAT registered, add VAT to the selling price after applying the markup. Use the VAT calculator to add 20%.
Frequently asked questions
How do I calculate markup percentage?
Divide the profit by the cost and multiply by 100. Selling for £45 something that cost £30 is a 50% markup.
What markup gives a 50% margin?
A 100% markup.
Does 50% markup mean 50% margin?
No. A 50% markup gives a one-third margin because profit is measured against a higher selling price.
For general information and planning, not personalised financial or tax advice. Verify important decisions with a qualified adviser.